Since a successful energy transition must be renewable, efficient and smart, the digital transition and the energy transition should go hand-in-hand. Solar is the most distributed of all energy resources and thus solar solutions are a perfect match for digitalisation and the application of distributed ledger technologies such as blockchain.
This is good news for Europe’s energy transition. Digitalisation and increasing electrification of the energy system enables to break the boundaries between key sectors such as industry, transport and buildings. This sectoral integration unlocks new sources of clean flexibility, and supports the increasing penetration of solar and renewables into the system. Smart meters, automation controls, smart appliances and digital system monitoring are very helpful to adapt energy consumption patterns to the generation profiles of renewables, thereby maximising the consumption of clean electricity across all sectors, reducing curtailment and supporting a more reliable electricity grid. Digital solutions also enhance consumer engagement in Europe’s energy transition with more personalised and user-centred energy services. Ultimately, digital solutions help bring solar to the people.
On top of this, the digitalisation of the energy sector is also an industrial opportunity. In 2018, SolarPower Europe published a report highlighting the most promising business models in the digital-solar ecosystem such as peer-to-peer energy trading that leverages blockchain and artificial intelligence to create digital energy communities, generate new revenues for consumers and business opportunities for European digital and energy companies.
A better EU framework for digital solar solutions
The Clean Energy Package adopted in 2019 sets a strong legal basis for the digital transformation of the energy sector. The Electricity Market Design regulation introduces new provisions to promote demand response, dynamic prices, flexibility procurement, and address the increasing complexity of data access, interoperability and data management. Additionally, the Energy Performance of Buildings Directive calls for more digitalisation solutions in buildings, while the Energy Efficiency Directive requires the deployment of remote readable metering devices in district heat and cooling networks and in sub-metering systems within multi-apartment and multi-purpose buildings.
Nevertheless, more is needed to harvest the full potential of digital solar. Particularly, the European Union should develop an ambitious strategy to accelerate the deployment of smart grids, reform incentives for network operators and reward flexibility services provided by solar installations and prosumers. Doing this will maximise the opportunities stemming from digitalisation and will increase the deployment of solar installations in Europe.
- Lacking necessary roll-out of digital infrastructures (smart meters, smart appliances, power electronics) which will contribute to a more flexible and reliable energy system in Europe.
- Current incentives for network operators based on CAPEX investments (grids) do not incentivise the use of flexibility solutions to enhance network management and reward the speed and accuracy of digital & solar services.
- Data access, management, and interoperability standards remain to be defined in Europe.
- Consumer expectations evolve as they demand more intuitive, personalised, ethical and engaging energy services.
- Digital knowledge: Policymakers need to keep up with advances on digitalisation, innovation and changes in consumer preferences.
- Digitalisation extends solar’s capabilities: With the support of advanced digital solutions and power electronics, solar installations become more flexible and provide high quality ancillary services to network operators on demand, with more accuracy than conventional generators.
- Digitalisation enhances consumer participation in the energy market, empowering EU citizens over their electricity consumption to save energy, and even generate new income by providing flexibility services.
- Digital solutions unlock new flexibility sources by fostering the sectoral integration of key sectors such as transport, buildings, and industry.
- Clean energy offers a huge opportunity to foster Europe’s industrial digital leadership in that segment as European companies are already global leaders in digital energy solutions.
For further trends in solar, download the EU Market Outlook for Solar Power 2019-2023.