The growth in clean technology has coincided with another long-term trend - the worldwide rise in urbanisation. Three years ago the United Nations (UN) estimated around 54% of the world’s population lived in a city. By 2050, this figure is projected to grow to 66%.
This change, along with climate change itself, heralds a major infrastructure challenge. The cities of the future will need to be powered in a very different way.
Instead of running transport and heating networks on thermal energies, like coal, oil and gas, many, including the UN, see the most viable solution being electrification. And renewable energy is central to this.
Cities are also responsible for 75% of global emissions yet they are often hubs for innovation.
Upgrading them with smarter responsive infrastructure represents an opportunity to make a positive change. But, it will come at a price.
Changing infrastructure for the future
Current city infrastructure is not fit for purpose. Too much energy is lost or wasted. Radical change needs to happen, from consumer habits to power generation and to infrastructure as a whole.
Many countries are pushing for decarbonisation. Renewable energy production has continued to rise at an exponential rate. A good example is offshore wind.
According the Global Wind Energy Council (GWEC) there is over 14GW of offshore wind in seven markets around the world. In 2013, this was less than 1.5GW. Moreover costs continue to fall at a rapid rate, most notably with offshore wind.
This will force us to look at something else. The grid.
As anyone in the energy sector knows, this crucial piece of infrastructure effectively works the same now as it did 70 years ago. Back then thermal generation was the only way forward.
Today, most centralised energy distribution networks are huge. They constantly leak power in transmission and often require an overcapacity capability to cope with any unexpected requirement.
These grid systems are being stretched beyond capacity. They were designed in an age without computers, fridges, air-conditioning systems and many other devices that sit switched on throughout the day.
By 2020, almost a third of the global population will own a personal computer, according to The Climate Group in its Smart 2020 report.
The US Department of Energy estimates that between $1.5 billion to $2 billion will need to be spent on its grid between now and 2030. Many other countries are taking the same approach.
These changes should allow for the greater integration of renewable energy, reduce waste, and, in the long run, save money. They will also bring about a radical change in the way we live.
Fundamental to this is the smart grid, allowing generators to push power more efficiently. It will need to reduce the need for excess capacity and allow two-way exchange of information with the customer.
The latter is better known as demand-side response (DSR). Under it, businesses and households will have control over how they use and pay for electricity.
In terms of savings, a US study estimated the smart grid could increase efficiency by 9%, or 423 billion kwH. This is enough to power Las Vegas for a year.
Changes like this could allow companies to become energy producers in their own right. With utilities poised to become ‘mini-Ebay’s’ buying and selling power across the grid.
Renewables and the smart grid
Renewable energy — especially wind — can thrive in this sort of environment.
MHI Vestas chief executive Jens Tommerup says: "We believe the future energy mix will be much more reliant on electricity and we believe, for instance, district heating can be electrified.
"We know electric cars have a great future so with this electrification of the energy system we also believe that offshore wind has a strong role to play."
One criticism of renewables is that it is a variable energy source. Although the wind and sun are only able to deliver energy at certain times, the smart grid will be able to deal with this.
Speaking as a manufacturer of the world’s largest wind turbine, Tommerup says: "It is right that offshore wind and wind in general has been looked at as variable.
"But we believe in the future, when you have more of the market being integrated and you have a larger transfer of energy between bigger markets, then it will also be easy to integrate even more offshore wind."
Major changes on a micro level
One of the big changes to the market is DSR. It allows the customer to downshift the amount of electricity they are using at peak times. Potentially, it allows customers to save money as well as emissions.
In his Cost of Energy Review for the UK government, Dieter Helm outlined the future changes to include: "rapid development of technology, electrification of transport, and the growth of zero marginal cost low-carbon generation and the decline of the wholesale market".
While businesses are already able to access these sorts of technologies, households will follow. By 2025, it is estimated there will be around 30 million ‘internet of things’ devices connected to the web.
Many of these will manage electricity usage. For example, smart fridges will be able to switch on at times of low demand.
It will change how people heat their homes. Gas will be less likely to be used and in its place will be electrically-powered systems like ground or air heat pumps.
The electrification of cities will mean a rapid adoption of electric vehicles. Already sales of electric vehicles are rising year-on-year. At the same time, the price of batteries is falling by around 14% a year.
Businesses will need to be aware of this change. In future, cars could be linked to a building via charging points, allowing the company to store electricity in their batteries for use at peak demand.
Storage has a huge part to play and is seen by many as the missing link in the argument for renewables. As with cars, capacity batteries can be used to smooth fluctuations in electricity supply..
EDF’s storage facility at its West Burton B plant can deliver 50MW to the grid in less than a second.
Micro and distributed generation will also grow within cities. A UK government-sponsored study by the Foresight Future of Cities Project, said although the electricity generated from these would be a fraction of demand it would enable greater efficiencies elsewhere in the system.
Second and third world economies also have a part to play. In some ways, they have an advantage because they don’t have the baggage associated with an existing infrastructure and way of working. They can, in effect, start afresh.
Changes to the markets
It is obvious that the world is changing. As cities grow so will people’s energy requirements. This will require behavioural change on a number of fronts. At the moment, much of this is being pushed by governments and the energy industry.
One area of concern is that businesses are failing to get on board and will be caught out in the future. There is an opportunity to save or even make money. Yet unless they look at embracing smarter solutions they will end up paying more for their energy.
There is a possibility the biggest contribution of the new technology will be to drive costs down. That will be the test.
Helm warned: "The cost of energy is not something the government can directly fix. It is the outcome of a myriad of decisions by companies and organisations around the world.
"Governments cannot fix the price of coal, gas or oil, the technologies, the price of cables, of IT, of labour, or of data. Nor can government predict the price of energy — and when it tries, unsurprisingly, it often does it very badly."
At the same time it is worth bearing in mind that smart technology already exists. And, like offshore wind, it is getting steadily cheaper and easier to implement. We just need to move towards it.