In the future as renewable power is integrated into the power grid and buildings are able to generate needed power on site, utility companies may become secondary sources of energy.  Renewable power is the obvious choice for the future considering the unpopularity of nuclear power, polluting fossil fuels, and the unreliable natural gas supply from Russia.

Smart cities could evolve as self-reliant entities full of buildings capturing power from the wind and sun.  Buildings could even supply renewable power to surrounding neighbourhoods.

Big utilities are learning about what the future power supply may look like and are adapting their long term strategies.  “A very different business model will emerge over time,” said Gearoid Lane, managing director at the New Energy division of British Gas.  “If any energy company ignores the long-term impact on future fossil-fuel-backed energy sales, they will be in for a shock.”

The entire system would be centred on a smart grid that allows energy to flow when and where it is needed.  Since power routed through a smart grid is networked using IP addresses, the intermittent supply of renewable power can be accounted for.

“We have had some interesting discussions with developers,” said Lane. “Whether they will develop the expertise in-house, or work in partnerships with energy companies, remains to be seen.  We have 10,000 engineers out there every day, installing and servicing boilers.  There's a relationship of trust already. That model will become more and more valuable when it comes to selling renewables and microgeneration.”

The notion that cities can become self-sufficient is gaining notice in the European Union.  The EU has set ambitious carbon-emission reduction goals of 20 percent below 1990 levels by the year 2020.

“In 25 years from now, millions of buildings … will be constructed to serve as both ‘power plants' and habitats,” said Jeremy Rifkin, an economist who has consulted governments and corporations on climate change and energy security strategies.

“The more fluctuating energy you have from renewables, the more it makes sense to have a smart grid,” said Markus Ewert of German utility E.ON AG.  “It would help stabilise the energy flows, so you don’t come up against the limits of the grid.”

“Electric vehicles could be connected to the grid and could store energy at times when too much is produced – and they could feed it back into the grid when there’s not enough.”

While E.ON sees opportunity in the future, other companies are certainly trying to protect their long-term interests and slow the pace Brussels, Belgium pursues in developing climate regulation.  Just last month a €500 million project that would have looked into the smart city concept was shelved.

Smart cities would not only reduce the amount of energy used in the future, they would also generate what they needed locally.  Much of the required technology is still in the development stages, but some are possible today.

Bouygues Immobilier, a French construction company, is currently building a facility in western Paris that will use solar panels covering 4,000 square metres to meet its energy needs.  Any excess power produced will go back into the power grid.

“We have entered an era of breakthroughs and of a technological revolution in the construction sector,” said Eric Mazoyer, deputy managing director at the construction firm.  “Because tenants will pay 60 percent less in electricity bills, we can charge higher rents and we will sell the surplus of electricity back to EDF [the French utility].”

Similar projects are underway throughout Europe that have built upon the reasoning that energy and new ideas are best shared in densely populated urban centres.  Cities also have a level of autonomy separate from the national government and oftentimes can make decisions that benefit the environment themselves such as what has been done in California and in London.

British Gas
PO BOX 3055
Eastbourne BN21 9FE
https://www.britishgas.co.uk

E.ON AG
E.ON-Platz 1
40479 Düsseldorf Germany
http://www.eon.com/

Bouygues SA
32 Avenue Hoche
Paris, 75378
http://www.bouygues.com/

EDF Group
22-30, avenue de Wagram
Paris, 75382
France
http://www.edf.com
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