ENERGY TRENDS FOR 2021: Switching to Smart and Sustainable
The energy sector faced unprecedented challenges in 2020, but we’ve also been given the opportunity to evaluate our goals and realign our direction for the upcoming year.
Now more than ever, a reliable energy supply that increasingly utilizes renewable sources is key to our post-COVID lifestyles. In 2021, I see the energy sector adapting to meet these rising expectations regarding efficiency and sustainability. Below are my predicted top trends for the new year:
1) Smart grids
Digitally enhanced smart grids are a key component in the energy sector’s transformation plan. In 2021, I expect to see the UAE make significant leaps in the development of its smart grid infrastructure.
The Dubai Electricity and Water Authority (DEWA) is planning to invest AED 7 billion by 2035 in smart grids and smart meters in the pursuit of its mission to transform Dubai into the world’s smartest city. The UAE also plans to harness over 18 gigawatts of solar energy by 2030, which will also increase future demand for smart grids.
This ongoing modernization of the grid and strong growth in renewable energy, coupled with the projected growing power demand, means that the UAE smart grid market is expected to register a CAGR of more than 2.5% between 2020 and 2025, according to market reports.
With the widespread adoption of smart grids, we will also see the energy sector provide increased support for remote assistance from utility companies, digital services for consumers and increased access to consumption data.
2) Electric vehicle infrastructure
Under UAE Vision 2021, the government is committed to such sustainability goals as improving air quality and increasing clean energy usage. The adoption of electric vehicles (EVs) has a major role to play in this plan.
This lifestyle change is being encouraged by DEWA and Road Transport Authority (RTA) through such collaborative measures as the installation of charging stations and exemptions from toll and registration fees in Dubai.
According to market reports, the UAE EV market is projected to grow at a CAGR of 32.1% during 2019-25. We will continue to see the development of EV infrastructure in 2021, as authorities and private companies are working towards improving charging technology and reducing the charging time for EVs.
3) Hydrogen as the ultimate green fuel
As the UAE explores opportunities in clean energy, hydrogen’s potential as the ultimate green fuel appears ripe for capitalization.
The UAE is already investing in green and blue hydrogen projects, with the Sheikh Mohammed bin Rashid Al Maktoum Solar Park in Dubai expected to become the first solar-powered hydrogen plant in the Middle East.
The project will use solar energy to extract hydrogen from water and generate clean power. It will also serve as a storage facility for renewable energy, preserving the power generated by other renewable energy sources, like wind.
4) E-commerce goes green
While consumers may be travelling less in the COVID-19 era, their online shopping habits have skyrocketed, which means there has been a corresponding uptick in fleet movement throughout the e-commerce industry. In order to ensure that this trend does not hurt UAE’s sustainability goals, we expect to see many fleet operators switch to greener fuels.
Outside of the UAE, we have already seen Amazon pivot towards sustainability with its pledge to decarbonize its operations by 2040. The company is looking to completely switch over to renewable energy for all its operations within the next five years. It has further demonstrated its commitment with heavy investments in green transportation, including a USD 700 million investment in Rivian, an EV startup and the acquisition of Zoox, a robo-taxi startup.
As the local energy sector gets serious about solar, hydrogen and biofuels, local e-commerce giants such as Noon are primed to make similar moves as Amazon.
The COVID-19 pandemic certainly caused massive upheaval, but in its wake, we have the chance to reimagine the energy sector as more future-focused. In 2021, I believe we’ll see trends that reflect that change, which could help power the post-pandemic world more efficiently and sustainably.
