Ensure access to affordable, reliable, sustainable, and modern energy for all; increase share of renewable energy; and double the global rate of improvement in energy efficiency.
Almost 1 billion people lack access to modern electricity services. Innovative advances are now combining solar power with microfinancing and mobile payment systems. Low-income households in off-grid areas can be offered clean, affordable, and fossil-free energy. And new smart meter and grid technology is playing a key role in matching energy supply from variable fossil and renewable resources and smart consumption.
Population growth and economic development – collectively and individually – are boosting the demand for safe and clean electricity globally. Opportunities for utility companies are abundant, as are the challenges. Decarbonization, deregulation, decentralization, and public pressure are disrupting the entire industry. New market entrants like Google and Tesla are adding to this with their revolutionizing business models. The entirety of it is driving the energy industry to embrace new technologies and innovate.
Of the global population, 13% still lack access to modern electricity services. While the access gap between urban and rural populations narrowed to 20 percentage points in 2014, from 35 percentage points in 1990, a lot remains to be done. This is particularly true for rural Africa, where electrification access lags population growth. Yet reliable access to sustainable energy can be “an engine for poverty reduction, social progress, equity, enhanced resilience, economic growth, and environmental sustainability,” according to the United Nations Development Program.
While the high cost of grid infrastructure extension is a barrier to electricity access, especially for rural households, Mobisol GmbH, a company that provides prepaid energy solutions, has found a smart way around. The company combines solar power with microfinancing and a mobile payment system to offer clean, affordable, and fossil-free energy for low-income households in off-grid areas. The solar home systems using Mobisol’s services are connected to a battery. Any excess electricity produced can be used to run businesses, such as mobile phone charging services and barbershops, which generate extra income and benefit the local economy. In 2017, Mobisol was recognized to be a technology pioneer by the World Economic Forum.
Currently, Mobisol has electrified more than 32,500 solar home systems for households (out of a total of 132,500 in the East African region), installing 2.7 megawatts (MW) of solar capacity to bring power to 162,500 rural beneficiaries in Rwanda. The company has brought not only electricity, but also work and education to 400 local technicians and sales staff. Mobisol provided training as well as empowerment of small business owners, who make up 40% of its customer base.
During infrastructure build-out, emerging economies can be early movers in applying a systems approach to the rollout of advanced low-carbon technologies. In highly developed and more stable environments, the transition toward renewable and decentralized power generation puts incumbent generators under high levels of economic stress. That’s where new smart meter and grid technology comes in to play a key role. Energy supply from variable fossil and renewable resources is matched with smart consumption while ensuring a stable and reliable energy supply.
Imagine off-peak hours, when there is a surplus of energy in the grid. You can run your laundry or charge your electrical vehicle. Flexible energy pricing, plus the availability of smart technology, makes these kinds of opportunities very attractive to consumers. Successful innovative business models are leveraging this fact. sonnen GmbH offers smart home solutions fully based on renewable energy, combining storage and smart consumption. The solutions complement sonnen’s business model by tapping into guaranteed compensation fees for accessing renewable energy from offshore wind parks. They also boost grid stability with their extra private storage compensation capacity. This model will be very attractive to 80% of European consumers, who will be equipped with smart meters by 2020, according to a European Commission directive.
These meters will empower consumers through transparency on their real energy usage, enabling them to monitor their consumption against benchmarks. Smart devices connected via mobile apps will reduce their energy consumption and help them save money.
Utilities will also benefit from real-time energy demands. They will be able to forecast and balance load, optimize demand response, and secure grid stability. This differentiating kind of service will increase customer loyalty.
At SAP, our purpose is to help the world run better and improve people’s lives. We shifted to 100% renewable energy in all of our data centers and facilities in 2014, as compared to 43% in 2013. Since this is one of our most significant actions to date to make our operations more sustainable, we extended our approach and are committed to becoming carbon-neutral by 2025. As an early member of RE100, a collaborative, global initiative uniting more than 100 influential businesses committed to 100% renewable electricity, we aim to support the global scale-up of renewable power.
But our impact on energy conservation and sustainability is even bigger when you consider the efforts of customers such as these: