How will energy demand change in the post-COVID-19 world?

The 4th Industrial Revolution

Our next revolution will be disruptive. By using a range of new technologies, it will fuse the physical, digital, and biological worlds in a way that impacts all economies and industries. It will include everything from the Internet of Things (IoT) and artificial intelligence and machine learning, to 3D-printing, satellite mapping, genome sequencing, and stem-cell breakthroughs. The result? New technologies like autonomous vehicles, smart buildings, smart cities, virtual connectivity tools, and faster access to medical data. 

Many of these technologies are proving to be critical to communities during the COVID-19 response. Workforces can stay operational and families can remain socially connected as they practice physical distancing. But while many people enjoy the benefits of these technologies, the social equity divide is growing. 

Historically, little attention has been paid to the disruptive nature of the 4th Industrial Revolution. Even last year, when Democratic US presidential candidate and businessman Andrew Yang tried to highlight the impacts of the 4th Industrial Revolution, his ideas were pushed aside to make room for traditional kitchen table items. But Yang understood how this revolution will impact the geographical distribution of economic growth, linking key swing states to poor economic conditions caused by workplace disruption and automation. 

While Yang was unsuccessful in his presidential bid, we can still use his lessons to help drive understanding heading forward. Geography can and must be the driver of an industrial revolution that services the needs of all communities. And we can monitor this phenomenon via satellite technology to remap our world—both physically and socially. Tools like this will help us to better understand the layering of both infrastructure inventory and socioeconomic conditions. 

What does this mean in practice? 

The energy transition—a move toward a clean energy and a carbon neutral future—is one of Stantec’s strategic growth initiatives. One of the central themes of the transition is the microgrid. This is where the geographer’s mindset is a game changer for the social-equity outcomes of infrastructure growth.

The question around microgrids have evolved. We used to ask: “What communities have the highest energy demand and greatest need for energy resiliency?” Now, we ask: “What communities have underutilized energy assets, and a need for economic growth, for which a microgrid could be a catalyst?”

The technologies of the 4th Industrial Revolution enable energy mapping based on economic characteristics, rather than solely focusing on physical infrastructure potential. Microgrids can be a real estate play, not just an energy asset. Municipal authorities must look at how their economies are going to grow. 

Next, they can plan infrastructure that will deliver it—and this needs to be agile. Why? To ensure people and society are at the center of the outcomes. Rather than being dictated by technology, our approach needs to be agnostic. It must also be open to create a free market economy that allows innovation, new ownership models, and speed.

How will energy demand change in the post-COVID-19 world? 

Will households flee from the cities to the suburbs because of social distancing? Will companies increase the percentage of their workforce working remotely to decrease their need for office space? Will this cause an increase in overall demand on servers and data centres to support remote logins? Will policymakers finally address the inequity of air pollution sources after understanding the links between respiratory conditions and COVID-19 cases? 

It is too soon to predict how the world will change, but now is the time to plan for the range of potential outcomes. We can plan so all communities have the infrastructure needed to support them. From school districts assessing the ability to engage in virtual learning to first-last mile issues facing essential workers in the case of a disaster, equitable growth is possible if we apply the lessons we are learning right now. 

Economic growth and energy consumption

Economies of scale have been the mantra for growth. This trend is based on the existing norm, which sees centralized data centers and super computers being built for city-scale power consumption. The problem? A single data center can take out an entire economic geography’s remaining power capacity. That is not good for economic growth.  

The current response to this is to build even more centralized power generation and larger transmission networks. When we throw renewable energy into that mix, we can notice an enormous gap. This is due to the intermittency of technologies like wind turbines and solar panels. Here, we find the opportunities for cities to plan infrastructure to close this gap: Infrastructure planning needs to consider the whole economic system, including data, computing, transport, and energy. 

At Stantec, we have been modelling these outcomes to plan future growth. We understand the existing geography of power infrastructure. That helps us predict the nature of economic growth and reflect on the opportunities to decentralize infrastructure, enabling economies of scale. 

When you expand the basic principles of an energy microgrid to a larger scale, the value of the underlying energy infrastructure increases significantly. Think public transportation, dark fiber, 5G technology, and micro data centers. Now, you have a system in which autonomous movement is enabled by urban-communication infrastructure—both powered by municipal power-generating infrastructure. This helps to increase access to job centers and labor markets, all working together to send revenue back to the community.  

This approach potentially places transportation planners, transit agencies, utility companies, telecommunications companies, real-estate brokers, and chambers of commerce at the same table. The result? The whole community benefits. The centralization of data, computing, and energy are still the core part of enabling the 4th Industrial economic boom. But innovation is where urban-microgrid infrastructure can unlock economic growth for an entire community.

What will success look like?

The breadth and depth of the 4th Industrial Revolution has the potential to change how we plan growth. But this requires us to consider the existing policy, regulations, and investment rule books differently. 

We understand these variables to help plan for outcomes that create truly wonderful new communities. If the balance of power focuses on using innovative energy technologies to catalyze communities in need of economic growth and employment opportunities, the 4th Industrial Revolution will find its home there.