At Nokia our responsibility for clean energy doesn’t end with our own consumption. We believe energy should be green, secure, reliable and affordable for everybody. To maximize our contribution to this global challenge, we looked at each of the famous four Ds — decarbonization, decentralization, democratization and digitalization — the key drivers in transforming the energy system.
Decarbonization
Although important, there are limitations to how much we can reduce consumption or improve energy efficiency. The crucial lever is to transition from fossil fuels to carbon-neutral energy sources. This means mostly massive (green) electrification and, where not possible, use of green hydrogen, although the latter also depends on green electricity to generate. To achieve net zero, we must take a holistic approach across the entire supply chain, including the kind of energy needed to build, generate, distribute and maintain our green energy systems. As we deploy this net-zero system, we must be just as cognizant of its social and environmental footprint (e.g., mining of copper, cobalt, rare earth elements, lithium, etc.) as we are of the carbon footprint of the energy sources.
Decentralization
Energy systems are historically based on a centralized approach. Generation, transmission and distribution of energy used to be stacked in a one-directional and, often, vertically integrated arrangement. Renewable generation, however, is changing this paradigm. Instead of having a few, very large, centralized power plants, renewables like wind and solar tend to be smaller and more distributed, with thousands of times more generation units. Hydro plants and off-shore wind parks follow the centralized paradigm, but there are many medium sized on-shore wind and solar parks, and significantly smaller and even micro-sized units such as SMB and residential rooftop solar installations.
Because their electricity output is very volatile and often does not follow consumption, renewables must be complemented by energy storage solutions on grid and on industrial, commercial as well residential consumption levels, further decentralizing the sources of power. From a grid management perspective, this requires a much more flexible and intelligent system. Instead of a one-directional load following power flows across a wide single area, there is a highly decentralized topology with a multi-directional exchange of many more granular power flows that needs to be balanced across all layers in the distribution and transmission grids.
Democratization
The transition to renewable and decentralized energy solutions was for many years seen as a luxury for the more affluent. With economies of scale and technology advances, renewable energy costs are now considered on par or cheaper than fossil fuel generation. Net-zero targets aside, the democratization of the energy sector positions low-cost renewables as a strategic measure against energy poverty and dependency. It empowers individuals, communities and non-energy companies to become active participants in the transition, saving and even making money by going green.
Greater Manchester’s local energy market initiative is one example of energy democratization. They are meeting their net-zero goals by developing local energy markets that will optimize energy consumption, production and storage by engaging local residents and businesses. Their goal is to “ensure at the end of every pipe and wire is an informed household or business making low carbon decisions with the best evidence.” Smaller energy generators and storage providers can provide energy back to the grid in an open and transparent spot market (Prosumers). Others may simply optimize their energy consumption for a more cost-efficient and grid-friendly profile (Flexumers).
Democratization also provides energy autonomy for rural and under-serviced locations and, with it, an opportunity to restructure existing power dynamics for more equality politically and economically.
Digitalization
Distributed energy resources (DERs), as discussed above, require intelligent coordination to balance the supplies and demands of increasingly complex energy flows. The intermittency of renewables calls for more dynamic scaling and more granular and frequent multi-party transactions. These intelligent digitalized systems need to be safe, resilient and highly efficient, as well as fair and transparent about environmentally and socially problematic resources.
Developing cutting edge, futureproof digital solutions for the energy sector is something to which Nokia is proud to contribute. We believe energy should be green, secure, reliable, and affordable for everyone. Our mission is to simplify complex systems based on our rich digital heritage and experience providing world class high-availability network solutions. Our Sustainable Energy Management toolset (SEM) is a highly flexible and scalable automated simulation solution that improves grid performance and orchestration planning for managing flexibility, storage, generation and consumption.
By bringing together our technology innovation pioneers at Nokia Bell Labs with our digital product experience and the relevant players of energy markets, we jointly develop solutions that meet all the dimensions of this global challenge.