Kristian Ruby, secretary general of Eurelectric, the trade association representing the interests of the electricity industry in Europe, is fascinated by AI – and not just because it’s replacing the need to send inspectors in climbing gear to rappel up and down wind turbine blades. Inspectors now send drones with AI tools, thus eliminating some of the costly, time-intensive, and dangerous manual inspections needed to keep wind farms running safely and efficiently.
“AI is probably the most transformative technology humanity has ever seen,” said Ruby, speaking at an executive event at the SAP for Energy and Utilities Conference in Sevilla, Spain, hosted by Daniela Haldy-Sellmann, global VP and head of energy and utilities industries at SAP. “The curious thing about this kind of technology is that we’re stunned the first time we see it, but suddenly, it becomes normal.”
The electrification of Europe
AI is everywhere in the sector. With the increasing decentralization and digitalization of the power grid, AI is used to balance the grid efficiently by analyzing data from various sources including consumers, producers, and storage. In electro-mobility, AI coordinates the charging of electric cars and adjusts charging demand to price signals and availability. It detects anomalies in generation, consumption, or transmission and develops suitable solutions. And of course, it’s used to coordinate and execute maintenance work, minimizing costs and disturbances of the network operation.
Ruby’s job at Eurelectric is to advise decision-makers at roughly 3,500 companies in the electricity sector in Europe along with a number of affiliated organizations in other regions. It involves interpreting huge amounts of regulations to help companies comply as the EU fast forwards its green transition to reduce emissions by 55% by 2030.
“By 2030, we expect to have about 75 million electric cars on the road. Leaving the ice age of combustion engines behind will require an awful lot of new charging infrastructure, not to mention other factors such as adding 50 million heat pumps to the grid,” Ruby said.
He explained that the market is experiencing a regular gold rush in renewables as the EU is approaching the end of a political mandate with new politicians and policy makers jockeying for position as a new era emerges. There’s also the matter of an estimated €60 to €70 billion of investments in distribution grids needed until 2050.
The mega trend
The biggest change Ruby sees in the energy transition is decentralization. While there will still be many centralized assets, Eurelectric estimates that some 70% of all new generation capacities will be connected to medium- and low-voltage grids, creating a massive shift of dynamics.
“We need to operate grids differently. We’ll need to reconstruct the supply to ensure demand is met for local companies. Distribution companies will be facing much more complex flows, much higher loads, and they’ll have a multitude of customers they’ve not had before,” he explained.
To deal with these changes, Ruby sees a need for more entrepreneurs, less regulatory sort of restrictions, and a revised time window for investments with greater visibility, more foresight, and a greater focus on digitalization than ever before.
To meet the vision of Eurelectric – which is to create a sustainable, competitive industry in Europe that delivers affordable, secure, and clean electricity – Ruby and his team aim to identify relevant topics of critical business interest and unite the industry around common views.
“We convey the interests of our stakeholders to policymakers in Brussels, which requires a lot of thought leadership, and advise them on all the issues to be considered as they’re developing legislation. Then we relay the details of the regulations back to the industry, so they can prepare execution plans for what’s coming,” he explained.
Focus on the action, not the topic
Ruby is excited that change is happening much faster than expected. In 2024, 48% of all electricity is coming from renewables, which are entering the mix at a record pace. This acceleration is helping to bring down prices, sometimes to just a couple of euros per megawatt hour. Another exciting thing is that one in five new cars last year was an electric car.
“Thanks to the fast adoption of these new technologies, we’re seeing an accelerated transition to a cleaner, greener economy,” he said. “We’re living through a historically intense period. We’re fundamentally changing the entire economy in a relatively short time, and we’re doing it for good reason, because ecosystems around us are collapsing, extreme weather being one example. So even if there is some frustration and confusion, we shouldn’t get sidetracked. Now’s the time to focus on execution.”
Circling back to the topic of AI, Ruby commented that about 90% of the world’s digital data was created over the last two years, resulting in a total of at least 123 zettabytes of data in 2023 – a sum so astronomical it involves 21 zeros. Data volumes just in the energy sector are overwhelming, especially when you think of all the data companies are expected to process to make data-driven decisions.
At the same time, companies must be mindful of doing business in a new world in terms of capital and labor. AI is a capital asset, but it functions as labor, performing tasks done by humans. “Companies are surrendering a lot of decision power to AI. If it messes up, we’re still stuck as a company or as individuals in the executive management with the liability for any errors, so we need to apply ethics to the way we use these hybrid assets,” Ruby concluded.
Read the full article here
