“Demand management is not well understood in some countries and it is going to play a very important role in the energy sector. The issues are with the rapid flow of renewables coming up with firming capacities”
New Delhi: Developed nations like Germany, Australia that used to dominate in the coal-fired energy generation are now quickly diversifying into renewables. Ted Surette, Global Head of Power & Utilities and National Industry Leader, Energy & Natural Resources, KPMG talks to Ankush Kumar of ETEnergyWorld on the importance of demand management in the energy sector and opportunity for India in the rooftop solar segment.
What is the biggest opportunity for India in the energy sector?
Power utilities are going through an enormous digital transformation with the adoption of smart meters, battery storage, and renewables, etc. There is an opportunity to bring integrated energy policy and climate change policy together. We need to bring greater clarity to our policies and responses so that we have a durable, scalable and flexible energy policy that can help us reduce our carbon emissions in the long run. India has a huge opportunity to leverage rooftop solar in terms of having potential subsidies and tariffs. It has to be affordable and cost-effective. In Australia, we have got a very high penetration of rooftop solar.
How should a modern energy ecosystem like that of India function with complexities of managing multiple energy sources?
The whole ecosystem of players has to work in a more cohesive manner and understand things across the whole energy demand and supply. There are decisions made in silos. We need a common platform where the entire outlook of the energy landscape can be discussed.
What is the most important thing that policymakers should keep in mind when it comes to managing energy transition?
Demand management is not well understood in some countries and it is going to play a very important role in the energy sector. The issues are with the rapid flow of renewables coming up with firming capacities. A few years back counties were only aiming to push renewables into the grid. The network supervisors today are closely monitoring how the rise in renewable energy is directly impacting the grid. There is a lot more focus to connect to the network and all the ecosystem of the assets.
What do you think will be the role of next-generation discoms in this transition?
They will have to manage more assets and they will have to provide more flexibility. They have to be much more consumer focussed and leverage technology in a much bigger way that will help them to deal with a range of assets on the network. Technologies like blockchain, IoT, AI, robotics, analytics will be used for offering better value prepositions to the consumers.
How do you see the role of technology evolving in the energy sector? Are people worried about technological disruption?
I do not see people around the world being worried about getting disrupted by the evolving role of technology as they see the potential of digitization across various sectors. We are in a world where there could be more climatic events and technology is going to be used for preventive maintenance of several renewable energy assets. Technologies like Blockchain can be used to monitor all the assets on the grid, it helps in allocating the provenance origination of renewable energy. There are businesses and consumers who want to make sure that if they are drawing green energy then that source should be a true source.
Achieving climate goals and having more renewables into the grid is a challenge when it comes to utilizing legacy power infrastructure. How are other economies dealing with such stranded assets?
All the economies are today talking about transition challenges. Developed nations including Germany have gone through the same issues of stressed assets when they moved to renewable energy. Brazil has a large dominance of hydropower and they have faced issues of drought earlier. They are diversifying into the wind and now they are gradually getting into solar. Canada has got a large number of renewables. It has phased out its coal-fired power plants. It has also got nuclear power. Like India, Australia is heavily dominated by coal-fired generation and is now strongly pushing towards renewables. The situation with respect to stranded assets varies from country to country. There is a multitude of factors that led to that situation. All countries are working on how we are going to manage through the energy transition and deal with the affordability, energy security and sustainability challenges.