The Energy Sector: Future Thinking Is Critical

Posted on 04-17-2018 by
Tags: oil , gas , Energy


The future of energy technology is being fueled by a tsunamis of innovation.

 

A 10th-Century resident of Absheron, being familiar with oil as a commodity, wouldn’t be surprised by oil’s importance today. From this, some might argue that—despite a span of 1000 years—not much has changed in terms of oil’s prominence. This argument holds up because over the course of human history, only a few energy sources—fire, electricity, oil—have fundamentally changed the energy world.

 However, if we look at energy today, from one year to the next, many will argue that energy is actually changing at light speed. With light speed changes, yesterday’s energy supplier might not recognize today’s energy technology. In this case, the energy technology of 10 years ago can feel like the energy technology of a 1000 years ago. Alluding to this in his book Thank You for Being Late, Thomas Friedman noted:

The accelerating speed of scientific and technological innovations ... can outpace the capacity of the average human being and our societal structures to adapt and absorb them.

But those in the energy sector don’t have to be outpaced. They can outmatch technology by staying informed, staying ahead, and keeping their heads out of the sand. To outmatch technology, those in the energy sector must always be looking to the future.

Energy Technology: What’s Lurking Around the Corner?

According to the Brookings Institution, the future of energy technology is being fueled by a “tsunamis of innovation.” In his Brookings article, Tsunamis of Innovation Are Shaking the Energy Industry, David G. Victor writes:

In some areas, like oil field drilling and maintenance, the impact of big data management and sensors can already be seen in the field, and the ways those technologies will keep cutting costs is relatively easy to fathom. In others, new technologies seem ripe to cause transformation but nobody really knows how—for example, distributed ledger transactions often called “blockchain.” {emphasis added]

In terms of blockchain, the assertion that “nobody really knows how” isn’t entirely true. Laurent Benichou predicts that blockchain tech will allow people to produce and sell their own energy. In fact, according to Benichou, this prediction is already at our doorstep:

[W]ith SolarCoin, the sale of self-produced electricity is already a reality. SolarCoin is a cryptocurrency generated by the production of solar energy: any owner of a solar PV system, whether an individual or a business, can earn SolarCoins.

Like blockchain, artificial intelligence will have an impact on energy, but right now, that impact is speculative. While it’s still early when it comes to how the energy sector will deploy AI, there are a few guesses. Katie Fehrenbacher predicts that AI will be used to manage, optimize and maintain the grid and power plants. She also predicts that power companies will start using AI to enhance security, efficiency, reliability, safety and better customer experiences.

Energy Tech Isn’t All Offensive: There’s Defensive Too

Big data, blockchain, and AI offer optimism in the energy sector, but the future of energy technology isn’t just about what companies can do; it’s also about what companies must prevent.

Herbert Smith Freehills LLP lists cyber security as “an increasing concern for oil and gas companies.” The law firm points to several pain-points that are creating complexity in cyber security management. These include:

  • The increasing interconnection of the energy sector.
  • The increase in web-connected devices such as smart grids and smart meters.
  • The growth of “internet of things.”

Cyber security in the energy sector is further examined in the LexisNexis white paper Energy Sector Overview: Market Trends, Legal Activity & Outlook. The white paper calls the energy sector a “sweet target,” writing that:

A looming threat to the Energy Sector—as well as all aspects to the U.S. infrastructure, including the chemical, communications, transportation, financial services, water systems and more—comes from cyber attacks launched by terrorists and criminals.

According to Symantec Security Response, the energy sectors in Europe and America are under assault by cyber attacks that could inform attackers on how to “severely disrupt operations.”

Drilling Down: Trends and Developments in the Energy Sector

Beyond cyber security, the LexisNexis white paper Energy Sector Overview: Market Trends, Legal Activity & Outlook takes a broad look at energy’s future. Those in the energy sector who want to stay informed and stay ahead can download the white paper and read about specific trends and developments/ activity and concerns, including:

  • Oil & Gas Mergers & Acquisitions
  • Criminal Liability and Oil Explosion Deaths
  • Hydraulic Fracturing, a.k.a. Fracking
  • Utility Rate Disputes
  • Solar Cells
  • Cyber Attacks

Don’t get outpaced by the changing energy sector. Download the LexisNexis white paper Energy Sector Overview: Market Trends, Legal Activity & Outlook to read about specific business, regulatory and legal trends in the oil and gas sector, plus developments relating to the regulation and litigation of hydraulic fracturing, energy rate disputes and regulation, trade issues relating to solar cells, and an update on threats to our critical infrastructure.


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