The global energy sector is currently grappling with a significant $18 trillion investment gap that is projected to extend through 2030, primarily affecting electricity networks, according to insights shared by Oxana Dankova, a partner at Boston Consulting Group (BCG). A staggering 90 percent of this shortfall is concentrated within electricity infrastructure and end-use applications.
In order to bridge this financial divide, Dankova advocates for immediate and practical measures that can be taken within the industry. She emphasizes the importance of initiatives on the customer side, such as comprehensive energy efficiency strategies that could lead to a reduction in building energy demands by up to 30 percent. Furthermore, she proposes leveraging demand flexibility, specifically through the use of district cooling networks that utilize thermal storage to manage consumption during off-peak hours.
Dankova notes that this approach could fundamentally change the dynamics of energy consumption, transforming consumers into active participants in grid management rather than merely passive users.
The potential for savings through digitalisation and asset management is also a topic of discussion. While not a panacea, digital tools and advanced network planning could decrease the necessity for traditional grid infrastructure by 20 to 30 percent. Many utilities are harnessing data from various technologies, including drones and satellite imagery combined with artificial intelligence, to reduce both capital and operational expenses by 15 to 20 percent. The implementation of smart meters and digital twin technology has enabled utilities to gain detailed visibility into power flows, significantly lessening the need for new connections by up to two-thirds. Moreover, technologies such as self-healing grids and microgrid management systems are currently enhancing resilience within energy systems.
As demand skyrockets, particularly due to the integration of data centres, electric vehicles, and industrial electrification, ensuring stability within the grid becomes paramount. Dankova cautions that the load variations presented by data centres, which can fluctuate by hundreds of megawatts in mere milliseconds, highlight a significant stability risk. She suggests that connection policies and grid codes require redesigning to foster resilient and thriving future energy systems, recognizing these new loads as “grid actors” that carry specific support obligations.
For long-term planning and workforce development, government involvement is crucial. Dankova highlights a critical disconnect between long-term infrastructure needs and short-term regulatory frameworks, warning that a narrow focus on five-year planning can lead to repetitive asset replacements. To mitigate excessive transmission costs, governments are urged to provide long-term visibility regarding development plans and coordinated land allocation.
In the global struggle for skilled talent in grid design and construction, government support is also pivotal. As Dankova points out, “successful regions will be those that develop comprehensive talent strategies.”
The future trajectory for the energy sector hinges on reimagining traditional sector boundaries, aligning toward an integrated ecosystem that prioritizes reliable, affordable, and sustainable energy.