Digitalisation

Digitalisation is converting data into value for national energy systems, resulting in an optimised, sustainable and affordable energy sector. IRENA guides countries on the use of digital technologies in energy systems and their impacts.

Digitalisation is a key amplifier of the power sector transformation, enabling the management of large amounts of data and optimising increasingly complex systems. For the power sector, digitalisation is essentially converting data into value. The growing importance of digitalisation in the power sector is also a consequence of advances in two other innovation trends: decentralisation and electrification. Decentralisation is led by the increased deployment of small renewable sources, mainly rooftop solar photovoltaic (PV), connected to the distribution grid. The electrification of transport and heating and cooling in buildings involves large quantities of new loads, such as electric vehicles, heat pumps and electric boilers. All these new assets on the supply and demand sides are adding complexity to the power sector, making monitoring, management and control crucial for the success of the energy transformation.

Digital technologies can support the renewable energy sector in several ways, including better monitoring, operation and maintenance of renewable energy assets; more refined system operations and control closer to real time; implementation of new market designs; and the emergence of new business models. In the context of the innovation landscape for a renewable-powered future, IRENA’s analysis focuses on one concrete application for digital technologies: the integration of variable renewable energy technologies into power systems. Accordingly, IRENA has analysed three specific digital technology groups in depth: 1) the internet of things (IoT); 2) artificial intelligence (AI) and big data; and 3) blockchain. The analysis indicates that none of these are silver bullets, but rather they reinforce each other as part of a toolbox of digital solutions to optimise the operations of an increasingly complex power system based on renewable energy.