Achieving profitability and sustainability for the energy industry demands that utilities adopt new business models and accelerate their path to digitalisation.
Modern energy systems are going through an increasing decarbonisation process. Digitalisation and decarbonisation represent key enablers, as they unlock new opportunities for actors across the value chain (consumers, retailers, producers, network operators and policymakers), providing them with new solutions.
At a recent industry gathering on 23-24 August in Sandton Johannesburg, Morgan Sithole, Chief Advisor to Eskom, said, “the potential of digital business models in the new energy economy is huge.” Sithole added, “reaching net zero will be a major challenge, but digitalisation can ease the transition.”
The combination of digital technologies and renewable energy solutions plays a pivotal role in the energy sector. The increasing attention toward clean energy sources, Internet of Things, Artificial Intelligence, Big Data, Cloud, 5G, and Blockchain technologies are influencing changes in energy companies’ value creation strategies and customer behaviour as well as in policy and regulatory frameworks.
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This transition will define the economic path for utility companies across Africa and will force the accommodation of an ever-increasing number and variety of alternative business models and new solutions.
Despite the uncertainty about what the future will look like, some key changes seem likely. Below are just a few:
These changes have begun to blur the boundaries of the energy system as we know it and challenge the traditional business model around which the energy industry has been organised for many decades.
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A greater effort is therefore now required to define more clearly what are the likely new institutional frameworks, the nature of the relationship among the new and incumbent energy players, and the role and perimeter of future regulation in this changing environment.
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