Electricity supply market facing a ‘perfect storm of change’

B etween The Lines Geoff Guenther

Electricity has become an afterthought in our minds. We expect that with the flick of a switch the room will light up, or the television will turn on. This, though, is rapidly changing. With the increasing use of electric vehicles alone, National Grid forecasts that we’ll no longer be guaranteed the ability to boil kettles, and we could end up with brown-outs if too many cars are charging at one time.

It’s not just electric vehicles, though. Other technologies being developed by Elon Musk’s Tesla are creating changes in how we use energy. They are creating the impetus for increased consumption, localised generation with solar roofs, and electricity storage.

The adoption of electric vehicles is, perhaps, the largest driver of change. This will be accelerated by the UK government’s decision to ban the sale of new diesel and petrol vehicles from 2040. On the generation side, solar, wind, and other micro-renewables will continue to become more popular and the energy they produce will be storable.

These factors are combining to create a perfect storm of change, and it could be unleashed by blockchain. Blockchain is the secure database technology used by bitcoin, and allows micro-trades between various individuals or parties. It can be used in energy much in the same way people currently use it to trade currency.

Having this capability opens up enormous possibilities. If your neighbour is in all day while you’re at work, you could sell the excess energy from your solar panels, stored in batteries, to them at a cheaper rate than the grid – avoiding high transmission fees otherwise necessary.

So where is this taking us? Some believe the grid will be completely decentralised, others see that as folly. The short answer is that we don’t know. Opening the market up to allow for change will give consumers more choice and should also give us a cheaper, more flexible energy supply in the long run. As an energy supplier, we’re an intermediary for the customer and all the changes going on in the market. We need to protect our customers and offer them opportunities. Our role needs to evolve with the market and striking the right partnerships will be absolutely key for our customers.