The energy industry is going through a massive transformation right now. Here, we look at the three biggest trends and challenges the industry is facing.

1. THE 3 BIGGEST FUTURE TRENDS (AND
CHALLENGES) IN THE ENERGY SECTOR

2. © 2021 Bernard Marr, Bernard Marr & Co. All rights reserved
THE 3 BIGGEST FUTURE TRENDS (AND
CHALLENGES) IN THE ENERGY SECTOR
The energy industry is going through a massive transformation right now. Here,
we look at the three biggest trends and challenges the industry is facing.

3. © 2021 Bernard Marr, Bernard Marr & Co. All rights reserved
When you think about it, the term "fossil fuels" is particularly apt because our
traditional ways of generating energy were designed for the world of the past. In some
parts of the world, our reliance on these fossil fuels has gone on far longer than it
should have. This is why I consider transforming the energy sector to be one of the
most important challenges we face today. In this article, I outline three major trends
that promise to overhaul how we produce energy.

4. © 2021 Bernard Marr, Bernard Marr & Co. All rights reserved
TREND 1: DECARBONIZATION
This trend refers to the transition towards a clean, carbon-free world, largely by increasing our use of
renewables and increasing premiums on the use of fossil fuels.
Electrification is often touted as a significant way to decarbonize energy (switching to electric cars, for
example). Unfortunately, for the moment, fossil fuels still make up a huge percentage of electricity
generation in many countries – including the US, where fossil fuels are responsible for 60.3 percent of
electricity generation. For electricity to become emissions-free, we must move further towards renewable
energy solutions such as wind, solar, and biofuels. This alone could eliminate as many as 7 million deaths a
year from air pollution and slow (or reverse) the effects of global warming.
Of course, renewable energy solutions have their challenges – not least the fact that we need energy 24
hours a day, yet we don't have sun and wind 24 hours a day. We, therefore, need greater investment in
energy storage projects so that we can store the energy created through renewable sources.

5. © 2021 Bernard Marr, Bernard Marr & Co. All rights reserved
We also need other clean energy alternatives that can provide a reliable supply of electricity when
supply from renewable sources dips. For now, that means nuclear power. I understand that nuclear
makes people nervous, but the technology is one of the safest and cleanest ways of producing
energy. In fact, nuclear energy results in 99.7 percent fewer deaths than coal and 97.5 percent fewer
than gas (although I must say that the safety record for wind and solar is even more impressive).
Looking further ahead, we may see other clean energy alternatives come to fruition. For example, the
European Commission has a strategy to develop green hydrogen for use from 2030–2050. Other
exciting energy alternatives include magma power, which involves using heated steam produced by
magma deep within the earth to generate electricity. If that sounds far-fetched, Iceland already has a
magma-enhanced geothermal system to generate electricity.

6. © 2021 Bernard Marr, Bernard Marr & Co. All rights reserved
TREND 2: DECENTRALIZATION
In a nutshell, this trend is all about transitioning away from our current system of highly
centralized energy grids run by monopolistic energy providers, towards distributed energy
production systems. In other words, thanks to a combination of renewable energy and
localized “microgrids,” consumers can generate their own electricity for their own needs.
If you have rooftop solar panels, you’ll already be familiar with this idea. But, importantly,
decentralized energy schemes can scale up much bigger than that, serving anything from a
single building to an entire housing scheme, or even a whole city. This is exciting because it
means individual consumers, organizations, and local authorities can take charge of their own
energy portfolio.

7. © 2021 Bernard Marr, Bernard Marr & Co. All rights reserved
A good example comes from Glasgow, in Scotland, where there is a small but growing
amount of local energy generation from local generators in and around the city. The city is
also encouraging housing developers to not only look at their own localized energy
production on new developments, but also create shared energy resources with
neighboring developments.

8. © 2021 Bernard Marr, Bernard Marr & Co. All rights reserved
TREND 3: DIGITIZATION
This trend is all about the use of digital machines, devices, and technology to optimize energy
production, infrastructure, and use. We have “intelligent” everything these days, from intelligent
vacuum cleaners to intelligent coffee machines, so why not intelligent energy networks?
This trend is inextricably linked to the previous two. An increasing variety of zero-carbon energy
sources will mean our energy networks become more complex. And decentralized grids will
need intelligent solutions to monitor and manage fluctuating demand. Digital tools will help us
overcome these challenges and realize much-needed changes in the energy sector.

9. © 2021 Bernard Marr, Bernard Marr & Co. All rights reserved
What sort of tools are we talking about? Some of the major contributors to digitization in the energy
sector will be:
- AI and predictive analytics – particularly when used to analyze and predict demand, and adjust where
power is drawn from on distributed grids.
- The Internet of Things – including smart home thermostats that can help consumers cut their energy
use.
- Blockchain – which could be particularly useful for creating smart contracts that allow consumers to
trace where their energy comes from.
- Digital twins – which can be used to create a virtual replica of a power plant or even an entire grid,
allowing providers to model different scenarios, make better decisions, and improve efficiencies.

10. © 2021 Bernard Marr, Bernard Marr & Co. All rights reserved
These and other digital solutions have given rise to the collective term “Energy 4.0” – playing
on the term “Industry 4.0.”
Overhauling the energy sector won’t be easy. Traditional energy companies can be slow to
change – probably because they face some unique complications, such as health and safety
risks, and the huge amount of capital invested in existing energy assets. But change they
must, if they want to stay relevant in an increasingly competitive sector.

11. © 2021 Bernard Marr, Bernard Marr & Co. All rights reserved
To stay on top of these and other trends, sign up for my newsletter, and check
out my books ‘Tech Trends in Practice’ and ‘Business Trends in Practice.'

12. © 2021 Bernard Marr , Bernard Marr & Co. All rights reserved
Bernard Marr is an internationally best-selling author, popular keynote speaker,
futurist, and a strategic business & technology advisor to governments and
companies. He helps organisations improve their business performance, use data
more intelligently, and understand the implications of new technologies such as
artificial intelligence, big data, blockchains, and the Internet of Things.
LinkedIn has ranked Bernard as one of the world’s top 5 business influencers. He is
a frequent contributor to the World Economic Forum and writes a regular column for
Forbes. Every day Bernard actively engages his 1.5 million social media followers
and shares content that reaches millions of readers.

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