Energy Sector Answers Challenges... with Open Innovation Challenges
Few industries are as much in need of innovation as the energy sector. For decades, a few large utilities generated power and fed it through to consumers using their own power grids. Companies did not have to cope with the constant change that producers of consumer goods or technology firms need to adapt to. But in recent years, the industry setting has increasingly been challenged by the rise of renewable energies (and in Germany by the end to nuclear energy as well). Power generation has become less predictable and less centralized, which means power grids need to become more flexible and intelligent. Consumers are increasingly generating power by themselves through solar panels and wind turbines. They are becoming more and more aware of their consumption patterns and are seeking to consciously manage their consumption.
A growing trend in business innovation across industries are open innovation challenges and the energy sector is starting to embrace these as well. Under an open innovation challenge, an institution or a company publicly presents a problem and asks other companies, experts, NGOs or students to submit possible solutions. The winner is awarded a prize.
One example is the Dynamic Demand challenge by Nesta, the UK’s innovation foundation, and several partners, including UK grid operator National Grid. This challenge, powered by WE THINQ’s platform, sought proposals on how to shift power consumption away from peak hours and make better use of renewable energy. There were 76 submission, from which five finalists were chosen. One submission proposes to use the hardware Thermal Accumulator by thEnergy to transform buildings from passive energy consumers into active grid players that can react to power spot pricing and reduce electricity use. Another proposal that has entered the finals suggests to set up energy displays in local communities to highlight local grid conditions, allowing communities to adjust their energy consumption accordingly. The winner will be chosen in June 2014 and awarded 50,000 British Pounds.
In Finland, power consumption meters are installed in many households. But much of the data goes unused. The Finnish section of the Open Knowledge Foundation this year organized the Energy Hackathon 2013, during which researchers, designers and activists developed ideas and applications to make more of this energy data. The winning team proposed a real-time billing app that helps users lower electricity bills by exploiting spreads between in fixed-price contracts and spot pricing. The concept includes ideas for controlling heating systems accordingly and informing homeowners via text messages of high-cost hours.
Open innovation, and with it open innovation challenges, above all help to adapt to a rapidly changing environment.
