Crypto, NFTs and the Metaverse: emerging tech that could shape the energy transition
Lucy Yu • 28 January 2022
Lucy Yu • 28 January 2022
While our team is focused on ways that current technologies can enable behavioural change within the energy system – such as smart devices, automation and AI – new innovations are always around the corner, with the potential to speed up the pace and scale of the transition.
While many of these concepts might seem futuristic and protean, it’s critically important that as a sector, we stay attuned to their developments. No single piece of technology can help us reach net zero, but their evolving applications in a traditionally archaic sector present game-changing opportunities – benefitting people and the planet alike.
So what are some of the headline tech predictions for the year ahead and how might they shape the future of energy? Here’s a selection that have caught my attention:
Regulation means cryptocurrency is here to stay
Whether you love it or hate it, crypto isn’t disappearing any time soon. Digital currencies like Bitcoin have gone from a cyber cult obsession to a $1 trillion asset class – and governments across the world are preparing for its persistence.
Crypto parliamentary panels in the US and the UK are inching towards regulatory clarity, and while bans remain in countries including China, the announcement that it intends to become the first major economy to introduce its own digital currency demonstrates an acceptance of its enduring role in the financial landscape.
What implications could this have for the world of energy? The traditional mining of cryptocurrencies has long been criticised for its energy intensity – but are there creative ways to address this? Crypto farms could be co-located with renewable energy generation, mining only when there is an abundance of energy, and thus benefiting the overall system by supporting the integration of renewables.
Moreover, the introduction of government-backed digital currencies could accelerate solutions to energy usage, particularly when it comes to validating crypto transactions. For more on this, check out the difference between ‘proof of stake’ versus ‘proof of work’.
The NFT hype will get even bigger and fuel digital ownership models
A ‘non-fungible token’ (NFT) is a unique digital representation of an asset and can express ownership over anything. So far, we have mostly applied it to art and visual images – but as we know, the first use cases of new technology rarely end up being the ones that endure.
Some NFTs have amassed huge social status among collectors, signalling a generational acceptance of digital ownership alongside physical.
Examples of emerging, digital-based ownership models are engaging greater numbers of people across the world – and, in the context of energy, putting them in control of the whole value chain, rather than just picking up the bill at the end.
Ripple Energy joined forces with Octopus last year to build the UK’s first consumer-owned wind farm. Unlike many local energy projects, its shareholders come from all over the country, motivated by their desire to participate in the green energy revolution regardless of where they live and what might be available to them on their doorstep.
Globalisation could stay in reverse
Lockdowns, travel restrictions and tight border controls forced globalisation to take a back seat during the pandemic. Businesses and consumers had to quickly adapt and localise, resulting in significant changes to business operations.
An ongoing focus on, firstly, building capacity and resilience and, secondly, supporting remote working will likely encourage businesses and employees to keep operations close to home. What might this mean from an energy perspective?
Studies have shown that the pandemic nurtured stronger human affiliation with local areas. The transience of place, particularly for those living in urban areas, was put on trial as people were forced to live and work in their immediate surroundings. With hybrid working here to stay, stronger community ties can be leveraged in the context of energy.
As we move away from the traditional model of centralised thermal generation and transmission, energy assets are becoming more widely distributed. Community-owned renewable energy projects can help to decarbonise the UK’s energy system by generating clean electricity that feeds into the grid – and empower local communities at the same time.
Quantum computing could become a commercial reality sooner than expected
An idea sketched out on blackboards before the turn of the millennium has become a competitive race between governments, tech giants and startups: who can make machines that use the properties of quantum physics to perform computations first?
Commentators say we’re on the cusp of the commercialisation of quantum computing, when we’ll be able to use this technology to solve real-world problems.
When it comes to the climate, quantum computers could help with everything from molecular simulation to carbon sequestration.
In the near-term, quantum computers will be able to take complex, industrial processes that are hugely energy intensive and rapidly improve their efficiency. While a 0.5% energy saving might not sound huge, consider the impact of that figure across a giant data centre or a complex assembly line.
The metaverse will take hold
The recent rebrand of Facebook to ‘Meta’ has brought the concept of the metaverse to the mainstream. In this virtual world, real people can interact with one another and visit digital places, from museums to music concerts.
While its implications for the energy sector might not be immediately obvious, the ability to access a parallel universe presents untapped opportunities as we transition to net zero.
Virtualisation and the application of sophisticated digital enablers, like digital twins, will continue to disrupt the energy sector and address issues of efficiency, risk – and, importantly, the mass deployment of renewable energy.