There are a number of material trends and patterns that have been observed in the energy sector throughout 2021. Below we discuss 3 related trends and how they impact GridMarket’s plans for 2022.
- Transportation Electrification
The narrative is everywhere – electric vehicles are the future. The transportation sector is responsible for over 1/5th of global GHG emissions and is heavily dependent on fossil fuels. The industry represents a tremendous opportunity for decarbonization. The demand to move people and goods around the globe is only growing, emphasizing the need for a more sustainable transportation system. Up until recent modern times, many advances in transportation technology have contributed to increased emissions. Now we are seeing an emphasis put on developing mobility solutions with sustainability and clean operations in mind. Market drivers such as mandates and incentives are creating critical momentum. In the United States, the recently passed $1 trillion infrastructure package includes $5 billion for highway charging infrastructure, and the administration wants at least 50% of newly produced vehicles to be electric by 2030.
The impact of electrification demand is evident across subsectors of the industry. While Tesla has mostly dominated the passenger car market as the household name for the last few years, manufacturers are pivoting to compete with their own EVs. Enhanced capabilities, expanding charging infrastructure, and comparable pricing are all contributing to electric vehicles becoming competitive options rather than novelties. Commercial transportation is also evolving with the times. New electric solutions in the cold chain for trucks and reefers are entering the market, and fleet electrification is going beyond just electrifying vehicles. Providers are incorporating EV as one component of a whole – including charging and electrification with hybrid systems and microgrids at warehouses and storage facilities.
As other areas evolve, there will be niche segments for EVs to continue integrating. For example, the electrification of public transit in urban settings is low-hanging-fruit for many mid-sized cities. There are opportunities to make public transportation more accessible, thus encouraging greater use in locations where the majority of travel is done in individual vehicles. Then, by electrifying mass transit fleets and upgrading corresponding infrastructure, entire urban environments can make great progress in decarbonization, while also offering ancillary benefits to residents that transcend mobility.
2. Supply Chain Strategies
The global supply chain has faced massive disruptions and challenges over the last few years. The new year will certainly maintain if not exceed demand, with labor, economics, and manufacturing issues still plaguing the ecosystem as a whole. We anticipate seeing an evolution of supply chain strategies, especially in the clean energy industry. There will be a number of strategic pivots as stakeholders look to increase operational efficiency and generate revenue. As discussed previously, the transportation sector is undergoing a shift that increasingly is prioritizing electrification. This shift is driven by a number of factors – including consumer demand, regulation, pricing, and more – and as electric infrastructure strengthens, more companies will be integrating EV solutions into fleets.
Traditional supply and demand economics will drive diversity as consumers look to alleviate supply chain issues for themselves. If certain goods and services are unavailable from usual suppliers, customers will be incentivized and motivated to look for alternatives, expanding their own personal supplier ecosystem and, in turn, the global economy as a whole. This should impact the clean energy industry, likely increasing domestic sourcing and establishing new business relationships for technical, consulting, and financial service providers.
3. Portfolio-Based Project Deployment
Over the last 6-12 months, it has become increasingly obvious that customers are changing how they approach clean energy planning and implementation. For portfolio owners/operators and developers, there has been an air of caution when approaching progressive infrastructure projects. As peers and competitors have implemented distributed energy solutions and as pilots have proven successful, the reluctance is dissolving. Proof of concepts, public and private mandates, available incentives and financing models, and consumer pressure are all contributing to change.
It has long been more cost-effective and efficient to approach project development across an entire portfolio, but many have deemed the risk too high. As the risk appetites and comfort levels have evolved, so have project development strategies. By looking at carbon reduction and energy transformation initiatives across an entire portfolio, rather than one site at a time, customers can take advantage of better pricing and a more coordinated and organized approach. A tangible pathway to achieving corporate goals or meeting established mandates is advantageous in a number of ways. A portfolio-wide approach enables more informed decision-making; owners can prioritize sites based on unique circumstances (operational needs, localized incentives, energy-availability, environmental impact, economics, etc.) and then use these plans in targeted marketing and PR strategies while work is underway.
2022 will be a year of expansion and execution. The clean energy market holds incredible potential, and we will capitalize on the opportunity by scaling proof of concept projects, integrating new technologies, and constantly improving our platform to help optimize project performance and bankability. At the core of our success is our digital platform, and continuing to strengthen and expand platform capabilities will be a fundamental part of early 2022. Currently, the platform remotely surveys properties, portfolios, or discrete regions around the world for distributed energy potential – mainly solar PV, battery storage, fuel cells, combined heat and power, microgrid controls, and energy efficiency, though other technologies are included as needed. Work is underway to formally integrate electrification and charger analytics with existing platform offerings. GridMarket is already manually modeling EV charging in with projects, and embedding this functionality will be the newest addition to the platform’s suite of automated analytical capabilities.
Since incorporation in 2015, GridMarket has worked to increase the accessibility and viability of distributed energy technologies. Our platform development and corporate direction has been driven by market need, and this will continue into 2022. We are seeing massive interest and momentum in the EV industry, with our customers across all sectors looking for opportunities to meet net-zero goals and carbon commitments through DERs and electrification. GridMarket continues to innovate and evolve analytical capabilities to align with industry momentum and market signals from key customer sectors. Drawing on trends, proof points, and best practices from other projects, GridMarket offers customers the opportunity to consider a wide range of energy solutions and business models. By working with GridMarket, customers will:
-Take a holistic approach to their energy portfolio and operations, ensuring that all available value streams have been identified and that a customized solution is crafted to meet their needs
–Access a global network of best in class partners who will provide competitive project bids
Trends in key sectors continue to indicate that consumers and producers are prioritizing clean energy technologies and sustainable operations – this is also demonstrated by proof points across our portfolio of successful projects and partnerships. GridMarket was recently selected via competitive bid to facilitate a microgrid for a tier 1 automotive manufacturer and is partnering with a major trucking transportation portfolio to unify a facility and fleet electrification strategy. We have identified and secured new funding and financing mechanisms for national energy transformation initiatives, bringing the most cost-effective holistic solutions that use high-impact technologies. Our active pipeline includes fortune 500 portfolios and governments that are interested in renewable generation and storage and large-scale electrification, and we already have millions of dollars of projects contracted for development this year.
2022 holds tremendous potential and we are eager to grow with the industry, bringing clean energy to our customers and reducing carbon emissions around the globe.