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News article16 December 2021BrusselsDirectorate-General for Energy

In focus: The digital transformation of our energy system

Digital technologies have transformed our society and our economy, affecting all of us in our daily lives at home or at work. At a time when we are generating increasing amounts of data, we could even consider it one of the “drivers” that can power the energy transition, alongside energy efficiency, renewable energy sources or fusion.

Data is intrinsically linked to two of the major political priorities of the European Commission, the digital transition of the EU economy and society and the clean energy transition under the heading of the European Green Deal. While the link to the digital transition is clear and obvious, the role that digitalisation can play in reaching our long-term ambition of becoming climate-neutral by 2050 is perhaps less evident, but no less important.

Digitalisation and data sharing

When we speak about digitalisation we mean many things. These include artificial intelligence (AI), advanced data processing, the internet of things (IoT), machine learning, to name but 4 examples. These new technologies offer major possibilities to improve efficiency and manage the complexity of the energy system along all parts of the supply chain, from infrastructure planning, operation and maintenance, through energy generation and transmission, to energy consumption.

As our energy system becomes more decarbonised and decentralised, its digitalisation needs to follow suit, embracing the latest technology solutions. Data needs to move from one place to another, for example from a data centre to our homes, or from the battery in a car to the charging point and the electricity network operator. Transporting such data requires a secure and safe network, as well as a platform for a seamless exchange between the different parties involved.

Data sharing can also help in areas, such as energy performance assessments, renovation strategies or in the design, planning and implementation of sustainable energy and climate action plans, by local and regional authorities. 

Making data-sharing easier - based on clear rules regarding who can access the data, when and how - will be a building block for a common European energy data space. It will enhance the exchange and use of data in the energy sector for the benefit of the multiple actors in the energy system, such as suppliers, infrastructure operators, energy system providers and consumers.

Data driven innovation

Consumers are central for our energy system. Digital solutions can give them the tools to become active participants of the energy market, so called “prosumers”. For instance, digitalisation makes it easier for them to set up cooperatives, invest in renewable energy, engage in local energy communities and exchange electricity through peer-to-peer platforms, contributing to the overall flexibility of the electricity system of tomorrow.

At the same time, it also enables the creation of innovative services that are more tailored to consumer needs. Data driven innovation is therefore a key element to achieve the energy and climate objectives set out in the European Green Deal.

Impactful digital solutions like blockchain have unlocked new forms of digital transactions in the financial industry and beyond. In the same way, blockchain technologies can also provide a broad range of novel opportunities in the energy sector, for example by rewarding flexibility in the electricity consumption of batteries in electric cars. This is not just theory: a pilot project with the Dutch green energy company Vandebron gives electric car owners the opportunity to contribute to grid balancing with excess electricity from their car batteries.

A cybersecure digitalisation

At the same time, digitalisation creates new vulnerabilities in the energy sector. Cybersecurity and digitalisation are 2 sides of the same coin.

Exchanging data can only happen in a secure environment, as the information passed through the internet is both sensitive and essential to cater for our daily needs. As such, in modern times, ensuring the security of supply now also implies improving our resilience against any coordinated cyber-attack targeting Europe’s energy infrastructure. That is why the European Commission is working with stakeholders on rules to ensure that the highest standards of cybersecurity are applied to the European electricity grid.

Another aspect that should not be overlooked is the impact digitalisation has on climate. We need to be aware that the information and communications technology (ICT) sector, data centres and, not least, the global and constantly growing internet traffic impact heavily on climate. The International Energy Agency (IEA) states in a recent report that data centres account for 1% of the global electricity demand. In 2020, this was equivalent to 200-250 terawatt hours. The same report declares that demand for such services will continue growing, due to video streaming and gaming, which are forecast to make up 87% of consumer internet traffic in 2022.   

A new EU action plan

The European Commission is currently preparing a Digitalisation of Energy action plan to address all these points. The action plan, planned for publication in June 2022, will be one of the key initiatives to accelerate the implementation of digital technologies in the energy system, as highlighted in the EU energy system integration strategy. It aims to accentuate what can be done in terms of legislative and non-legislative activities to address these challenges, and in particular whether these are better addressed at EU level, left at national level, or even local jurisdiction.

As preparation for this action plan, the Commission is looking for input and thoughts from wider society. That is why all these issues are undergoing a public consultation, available in all official EU languages and open for input until 24 January 2022. The feedback will help shaping the different actions and intended sustainability transformations.

(This article is also available in French, German, Italian, Spanish and Polish)

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Details

Publication date
16 December 2021
Author
Directorate-General for Energy
Location
Brussels