'New Energy' is now a thing in Australia and globally, but what is it?
On my watch: Murray Hogarth
For a long time it's been hard to tell if 'New Energy' would stick as a useful descriptor for the dynamic transformation of the energy sector that is gathering momentum in Australia and around the world.
Now, however, it increasingly feels like it works and will last. So what has changed?
As solution space nomenclature 'New Energy' provides a straightforward binary differentiation from the problem domain, which can be summed up neatly as 'Old Energy'.
The term 'New Energy' already has been around quite a while, more than a decade, which is long enough to have developed a common meaning that's already becoming outdated because of the speed of technological change. Its dictionary meaning usually encompasses sources of energy that are renewable, and environmentally friendly, focusing on alternatives to fossil fuels - ranging from the right-now achievable, like solar and wind, to the futuristic theoretical like perpetual motion.
The real meaning in 2016 is quite different, because now we have to factor in the Internet of Things for energy (#IoT4energy) and the convergence of information and communications technologies with distributed technologies for generation, storage and consumption of electricity in both stationary (built) and mobile (transport) deployments.
Read on in this post for a breakdown of what 'New Energy' has become, including what belongs in the 'Old Energy' basket and where the grey areas lie. Suffice it to say now that 'New Energy' is rising as a powerful contemporary concept because it can expand to embrace both the clean energy revolution and the digital revolution, and how they reinforce one another in positive disruption, which is a lot more than just another term for renewables.
Why question the term 'New Energy' in the first place?
For me there've been several main reasons for doubting the staying power of 'New Energy'.
I've long been part of an inherently unresolvable debate, now decades old, over another term. It revolves around the suitability of the word 'sustainability' as a would-be encapsulation of the complex concept of integrating economic, social and environmental factors into a meaningful model for delivering sustained systemic well-being for people and nature in tandem.
Part of the problem has always been that people, and vested interests, can and will define nebulous terms like sustainability to suit their own agendas: such as the big mining and heavy industries' preference for 'sustainable development' to embed the presumption that economic growth must proceed whatever ecological or societal considerations may be encountered. Meanwhile, advocates for 'ecologically sustainable development' obviously see things quite differently.
Another reservation is the question of whether the term 'New Energy' really adds anything to the energy lexicon? We have clean energy, renewable energy, distributed energy, energy efficiency, energy productivity, energy management and so on. Does 'New Energy' really bring some higher level of meaning that improves on what the existing energy lingua franca already offers?
Also, it's not like we've actually discovered a new form of energy that totally replaces the modern-world, built-environment mainstay of electricity. Though we certainly have developed - and successfully scaled - new and better ways of generating and distributing electricity, and also of displacing other energy choices such as oil-based transport fuels with electricity in the form of electric vehicles.
For several years now the Wattwatchers core team has been verbally roaming around the question of where do we, as a business and a technology, belong in the energy sector broadly defined? As in, what is our place? We've finally found our identification zone in 'New Energy' and IoT for energy.
How do others define, use and brand the concept of 'New Energy'?
Globally, the most prominent 'New Energy' brand is Bloomberg New Energy Finance (BNEF), which came into being in 2009. The US-based transnational Bloomberg group, however, wasn't the original architect of the name. It took over a UK financial data start-up company operating in the carbon trading and renewables arena called New Energy Finance, which was founded in 2004. This has turned BNEF into a global powerhouse for progressive energy information, including its annual 'The Future of Energy Summit' and its 'New Energy Pioneers' series.
In Australia, perhaps paradoxically, branding leadership in the 'New Energy' space was seized two years ago by one of nation's oldest and largest traditional energy companies, AGL. In establishing a new business division, AGL New Energy, it also created a new role of Executive General Manager, New Energy, filled first by a UK recruit Marc England - who left to become CEO of NZ energy utility Genesis - and most recently by a US one, Elisabeth Brinton. AGL's increasingly vocal and high-profile CEO Andrew Vesey, who recently marked a year in the job, also came from the US and has strong 'New Energy' credentials himself.
AGL defines it thus: 'AGL's New Energy business unit was formed in 2014 to embrace major changes transforming the energy industry and to create new business models to meet customers needs. It currently comprises rooftop solar, commercial energy services, energy storage, electric vehicle services and the digital metering business, ActiveStream.' AGL also has invested directly in a number of 'New Energy' category technology start-ups, such as intelligent solar performance monitoring experts Solar Analytics, GreenBox Group (now known as Matter - Digital Solar) and solar + storage integrator Sunverge - so it has grafted on significant skin in the new game.
The 'New Energy' branding is spreading. Victoria's Labor State Government has identified 'New Energy Technologies' as one of its six priority sectors for the $200 million Future Industries Fund, and also has a $20 million 'New Energy Jobs Fund'. Big utilities group Jemena recently appointed a 'General Manager New Energy Services', filled by James Seymour who came from a solar ventures position with Origin Energy, and more such roles are being created across the energy sector mainstream as transformation becomes a 'can't beat them so join them' inevitability.
The World Economic Forum is exercising its mind on the 'new energy architecture' required to match the energy sector transformation under way, arguing that: 'Energy architecture underpins economic growth, and is a principal platform for human development and social welfare.'
And another thing, Wattwatchers recently won the inaugural 'New Energy Award' in the 2016 Australian Technologies Competition. That certainly got our attention. In its first year, 'New Energy' was arguably the most competitive area in the national innovation contest, with nearly a third (11 from 38) of the semi-finalists spread across 8 distinct technology categories being in the 'New Energy' stream.
Re-defining 'New Energy' to match the rapid evolution of technology
In summary, 'New Energy' is the right term but its meaning needs updating, and most likely will require continuous revision to keep up with technological change. My breakdown to frame the definitional process is as follows:
OLD ENERGY - fossil fuels, nuclear power, mega-scale centralised generation, long-distance transmission, supply-dominated grids, utility control of consumers' energy data, energy as a commodity
NEW ENERGY - renewables, distributed generation and storage, electric vehicles and their interaction with electricity grids, intelligent data monitoring and control systems, consumer empowerment via data (real-time and historical), energy as a service
GREY AREAS - the big one is the role of digital metering systems for utility billing and other purposes, and the government-regulated market regimes that support them. They are 'Old Energy' if they fail to empower consumers with data, but could be 'New Energy' if the rules and business models change to allow that to happen.
As a concept for change, 'New Energy' isn't fully formed yet. But it's worth waiting for that to happen.
*Murray Hogarth is Director of Communications and Community Networks for Wattwatchers, the Sydney-based digital energy technology company that won the 2016 Australian Technologies Competition ‘New Energy Award’.