Report on Grid Digitalisation and Sustainable Development Goals (SDGs)

Introduction

The global energy and geopolitical landscape is undergoing significant changes, resulting in increased power demand, ageing infrastructure, and rising physical and digital threats to energy grids. These challenges highlight the urgent need to future-proof energy systems through grid digitalisation, aligning with the United Nations Sustainable Development Goals (SDGs), particularly SDG 7 (Affordable and Clean Energy), SDG 9 (Industry, Innovation and Infrastructure), and SDG 13 (Climate Action).

Key Challenges Facing Energy Grids

1. Energy Transition and Decarbonisation

   The acceleration of renewable energy adoption worldwide, such as Europe’s target of over 40% renewable electricity generation by 2030, presents a challenge as current grids cannot accommodate the new renewable load. Approximately 1,700 GW of renewables in Europe and 3,000 GW globally are ready but cannot be connected due to inadequate infrastructure, causing congestion and potential blackouts. Upgrading grids is essential to support SDG 7 and SDG 13.

2. Ageing Infrastructure and Workforce

   Most grids in the US and Europe were constructed in the mid-1900s, with over 50% of transformers and substations reaching end-of-life by 2030. Additionally, more than half of the current workforce is expected to retire by then, highlighting the need for sustainable workforce development in line with SDG 8 (Decent Work and Economic Growth).

3. Cybersecurity Threats

   Cyber threats targeting grids have more than doubled in the last two years, exacerbated by geopolitical conflicts. Disruptions can cause widespread blackouts, emphasizing the importance of resilient infrastructure (SDG 9) and secure digital systems.

4. Climate-Related Weather Events

   Increasing frequency of extreme weather events such as tornadoes, wildfires, and storms has caused up to 83% of recent blackouts, resulting in human and financial losses. This underscores the critical need for climate-resilient infrastructure (SDG 13).

5. Rising Future Power Demand

   Driven by artificial intelligence, data centres, population growth, industrialisation, and electrification, global electricity demand is expected to increase by 30% over the next 20 years compared to the past 50 years, necessitating sustainable energy solutions aligned with SDG 7 and SDG 11 (Sustainable Cities and Communities).

Regional Variations and Regulatory Context

• Renewable energy adoption, cybersecurity, regulation, and utility structures vary globally.
• The US features vertically integrated utilities managing generation, transmission, distribution, and retail, while Europe operates with unbundled entities.
• Energy is localized; thus, decentralisation and decarbonisation strategies differ by region.
• Political and public service priorities influence grid development, with resiliency and affordability being universal concerns.

Data Integration: A Critical Blind Spot

Data is considered the new energy currency; however, utilities face significant challenges due to siloed data systems between departments and between information technology (IT) and operational technology (OT) teams. This fragmentation impedes the creation of a unified data model, essential for effective decision-making and grid management, directly impacting SDG 9.

IT and OT Convergence for Grid Digitalisation

• Historically, IT and OT have operated separately, managing different systems and data models.
• Despite substantial investment, integration remains partial, causing duplication and data mismatches.
• Successful grid digitalisation requires collaboration and convergence between IT and OT departments.
• Hybrid cloud models offer a balance of agility and security, supporting critical grid functions.

Substation Digitisation and Edge Intelligence

Substations play a vital role in transmitting electricity from high voltage to residential levels. The digitisation of substations is advancing rapidly, with intelligence being pushed to the edge where data originates. This localised intelligence enables faster decision-making and response times, enhancing grid resilience and supporting SDG 9 and SDG 11.

• Edge intelligence reduces reaction delays from minutes to milliseconds.
• Virtual substations, replacing hardware functions with software and AI, represent a future innovation.

Lessons from the COVID-19 Pandemic

The COVID-19 pandemic demonstrated that companies with robust digital infrastructure and business continuity plans were more resilient. This experience accelerated digital transformation across industries, emphasizing the importance of stepwise, use case-driven implementation rather than large-scale “Big Bang” projects, contributing to SDG 9 and SDG 8.

Enhancing Grid Resilience through Digitalisation

Recent incidents, such as the Iberian Peninsula blackout that took 13 hours to restore, reveal that current grid systems are inadequate for future demands, particularly with the rise of electric vehicles and distributed renewable energy sources. Digitalisation enhances grid visibility and predictability, enabling proactive management and supporting SDG 7 and SDG 13.

Conclusion: The Path Forward

• Grid digitalisation is essential for sustainability, electrification, industrialisation, and climate action.
• Technology must be complemented by people, partnerships, and regulatory frameworks.
• Awareness and innovation in grid digitalisation are growing, promising transformative progress over the next decade.
• Continued efforts are necessary to meet net-zero goals and achieve the SDGs.

Source: Adapted from an interview with Shubbhronil Roy, Vice President of Digital Grids Strategy and Transformation at Schneider Electric, originally published by Power Technology.

1. Sustainable Development Goals (SDGs) Addressed or Connected

1. SDG 7: Affordable and Clean Energy
   • Focus on accelerating renewable energy adoption and upgrading energy grids to handle renewable loads.
2. SDG 9: Industry, Innovation and Infrastructure
   • Emphasis on modernizing ageing infrastructure and workforce transformation.
   • Digitalisation and integration of IT and OT systems for resilient infrastructure.
3. SDG 11: Sustainable Cities and Communities
   • Ensuring resilient and sustainable energy supply to urban areas to avoid blackouts and disruptions.
4. SDG 13: Climate Action
   • Addressing climate-related extreme weather events impacting grids and promoting decarbonisation.
5. SDG 16: Peace, Justice and Strong Institutions
   • Cybersecurity challenges and protection of critical infrastructure from digital threats.

2. Specific Targets Under Those SDGs

1. SDG 7: Affordable and Clean Energy
   • Target 7.2: Increase substantially the share of renewable energy in the global energy mix by 2030.
   • Target 7.3: Double the global rate of improvement in energy efficiency.
   • Target 7.a: Enhance international cooperation to facilitate access to clean energy research and technology.
2. SDG 9: Industry, Innovation and Infrastructure
   • Target 9.1: Develop quality, reliable, sustainable and resilient infrastructure.
   • Target 9.5: Enhance scientific research and upgrade technological capabilities of industrial sectors.
3. SDG 11: Sustainable Cities and Communities
   • Target 11.5: Reduce the number of deaths and economic losses caused by disasters, including extreme weather events.
   • Target 11.b: Increase the number of cities adopting integrated policies for resilience to climate-related hazards.
4. SDG 13: Climate Action
   • Target 13.1: Strengthen resilience and adaptive capacity to climate-related hazards and natural disasters.
   • Target 13.2: Integrate climate change measures into national policies, strategies and planning.
5. SDG 16: Peace, Justice and Strong Institutions
   • Target 16.6: Develop effective, accountable and transparent institutions at all levels, including cybersecurity measures.

3. Indicators Mentioned or Implied to Measure Progress

1. Renewable Energy Integration
   • Indicator: Percentage of electricity generation from renewable sources (e.g., Europe targeting over 40% renewable electricity by 2030).
   • Indicator: Capacity of renewables ready but not connected to the grid (e.g., 1,700GW in Europe, 3,000GW globally).
2. Infrastructure Age and Workforce
   • Indicator: Percentage of transformers and substations reaching end-of-life by 2030 (over 50%).
   • Indicator: Percentage of workforce expected to retire by 2030 (over 50%).
3. Cybersecurity Threats
   • Indicator: Number or rate of cyber threats targeting energy grids (noted as more than doubled in last two years).
4. Grid Resilience and Outages
   • Indicator: Percentage of blackouts attributed to weather events (up to 83%).
   • Indicator: Time taken to restore grid after incidents (e.g., 13 hours in Iberian Peninsula incident).
5. Energy Demand Growth
   • Indicator: Projected increase in electricity demand (30% more demand in next 20 years compared to past 50 years).
6. Digitalisation and Data Integration
   • Indicator: Degree of IT and OT system integration and data silo reduction (implied through discussion on data challenges).
   • Indicator: Implementation of edge intelligence and virtual substations (implied qualitative indicators).

4. Table of SDGs, Targets and Indicators

Source: finance.yahoo.com