What is smart energy?

Smart energy is the process of using smart devices to increase energy efficiency. See how IoT technology is making energy even smarter.
Maggie Murphy
April 18, 2022
Woman analyzing smart wind turbines

It’s no secret that it takes a lot of energy to power the infrastructure humans use — and many need — every day. Energy makes lights work, and cars move and is the backbone of many spaces, like homes, businesses, and schools.

While energy itself isn’t harmful to the planet, the ways we extract and capture it is. According to US Energy Information Administration (https://www.eia.gov/energyexplained/electricity/electricity-in-the-us.php), fossil fuels are the largest source of energy for electricity generation, but these resources are finite and not to mention harmful. Burning them releases large amounts of carbon dioxide, a leading cause of global warming. It’s clear a solution is needed, and the answer is smart energy powered by the Internet of Things.

Types of smart energy

In general, smart energy is used to describe anything that uses devices to create a more energy-efficient world. It centers on reusable energy to create a more eco-friendly world while also saving costs. Sounds like a win-win, right? Let’s look at what that means when considering three distinct energy sources.

Solar energy

As the name implies, solar energy is energy that is derived from the sun. According to the Office of Energy Efficiency and Renewable Energy (https://www.energy.gov/eere/solar/how-does-solar-work#:~:text=The%20amount%20of%20sunlight%20that,mirrors%20that%20concentrate%20solar%20radiation.), “the amount of sunlight that strikes the earth's surface in an hour and a half is enough to handle the entire world's energy consumption for a full year.” A renewable source of energy, solar energy is acquired by converting sunlight into electrical energy that can be stored in thermal storage, batteries, or used to generate electricity. Solar technologies achieve this through photovoltaic panels or using mirrors that concentrate solar radiation.

The benefits of solar energy are just as abundant as sunlight itself. Though the most obvious may be that it’s a much cleaner energy source that doesn’t involve releasing harmful chemicals into the environment, it also makes a lot of sense on a smaller level. Blue Raven Solar (https://blueravensolar.com/blog/how-much-do-solar-panels-save/) estimated that using solar energy can save people up to 90% on their utility bills, not to mention the tax credits individuals can get from the government for owning solar technology.

The exact savings may vary from person to person as many factors come into play, (https://www.energy.gov/energysaver/benefits-residential-solar-electricity) but the takeaway is that implementing solar technologies into a home or business is good for both the environment and your bottom line.

Wind power

Whenever you feel the wind blow on your face, you’re experiencing a form of kinetic energy, which is energy that a body possesses from being in motion. Wind turbines, the primary piece of technology in this type of energy generation, capture wind’s kinetic energy. As the wind blows, the blades on the turbine spin, turning an electric generator that produces electricity.

Like solar energy, wind power is a clean and abundant energy resource. Though wind can be at times unpredictable, it will always be a part of our natural world. Wind energy is also one of the cheapest sources of energy, and it’s only getting cheaper. (https://www.energy.gov/eere/wind/articles/experts-predict-50-lower-wind-costs-they-did-2015-0)In 2017, wind energy could be procured for 2 cents per kilowatt-hour (https://blogs.scientificamerican.com/plugged-in/wind-energy-is-one-of-the-cheapest-sources-of-electricity-and-its-getting-cheaper/). For reference, this is basically the same as the wholesale electricity market price. In that same year, US consumers were paying, on average, 12 cents per kilowatt-hour for electricity generated from traditional methods.

Natural gas

Though natural gas is technically a fossil fuel, it’s cleaner and more efficient than other options. Like coal, natural gas is found deep below the Earth’s surface and was formed over millions and millions of years as pressure and heat changed ancient carbon- and hydrogen-rich animal and plant remains into gas, oil, and coal. When natural gas is burned, it produces 45% less carbon dioxide (https://www.enbridge.com/energy-matters/energy-school/natgas-enviro-friendly#:~:text=Natural%20gas%20is%20a%20fossil,Center%20for%20Liquefied%20Natural%20Gas.) than coal, making it a more environmentally-friendly solution. Natural gas is also historically much cheaper than other fossil fuels, and it’s possible to save between 25% to 40% (https://www.wisconsinpublicservice.com/savings/switch/calculators#:~:text=With%20natural%20gas%2C%20it's%20possible,40%25%20over%20other%20fuel%20types.)when switching from a different fuel type.

Recommended reading: Is That Mold on Your Cheese, or the Future of Renewable Energy? (https://www.hologram.io/blog/is-that-mold-on-your-cheese-or-the-future-of-renewable-energy)

What are the benefits of smart energy?

When talking about different types of renewable and clean energy, you’ve likely noticed a couple of patterns. They’re cheap and combat pollution, not to mention incredibly efficient. Let’s take a look at these benefits in greater detail.

Increased energy efficiency

Energy efficiency is an important goal when discussing the ways humans use electricity. It’s important to understand that energy efficiency doesn’t mean cutting back, that is, turning on your lights less or opening up your windows instead of using the AC. Instead, energy efficiency is about using improved design and technology to avoid energy waste. Essentially, it’s about creating solutions that let the end user do the same things they normally would, but with less energy use.

According to the US Energy Information Administration (https://www.eia.gov/todayinenergy/detail.php?id=44436#:~:text=More%20than%2060%25%20of%20energy,U.S.%20Energy%20Information%20Administration%20(EIA)), about 60% of energy is lost during conversion. Essentially, when coal or gas is burned to convert the stored energy into usable electric energy, over half of the available energy is lost. Many power plants, particularly coal plants, are simply old and outdated, and they’re not as efficient as newer technologies.

The administration noted that natural gas is significantly more efficient for generating energy compared to coal. “In U.S. power plants, generating a kilowatt-hour of electricity from coal requires on average about one-third more energy than producing a kilowatt-hour from natural gas,” the administration shared in an analysis of energy data in the US.

Recommended reading: Smart thermostats and lighting: How Zen Ecosystems and Hologram are making buildings around the world more energy-efficient (https://www.hologram.io/stories/zen-ecosystems)

Eliminating fossil fuels and pollution

Smart energy makes it possible to decrease our dependence on fossil fuels, particularly coal and crude oil, which release the most harmful emissions. In many ways, fossil fuels are abundant and reliable, which is the reason they’ve become such a normal part of our energy systems. However, when they’re burned, they release carbon into the atmosphere, which is a big contributor to global warming. (https://www.clientearth.org/latest/latest-updates/stories/fossil-fuels-and-climate-change-the-facts/#:~:text=When%20fossil%20fuels%20are%20burned,temperature%20has%20increased%20by%201C.) Climate change comes with many risks, including rising sea levels, melting ice caps, extreme heatwaves, and intense flooding, all of which could impact billions of people.

Fossil fuels also release other chemicals such as sulfur dioxide, ozone, nitrogen oxides, and soot. Soot (https://ugc.berkeley.edu/background-content/burning-of-fossil-fuels/), in particular, is extremely dangerous to humans and can cause asthma, bronchitis, and lung cancer. According to World Health Organization, (https://www.who.int/news/item/02-05-2018-9-out-of-10-people-worldwide-breathe-polluted-air-but-more-countries-are-taking-action) around 7 million deaths occur every year as a result of air pollution.

Reduce energy costs

When talking about smart energy solutions, a common argument is that they’re expensive to implement. While that might be true, there are upfront costs; smart solutions are often much more cost-effective in the long run. We’ve already talked about how wind-generated electricity is significantly cheaper than traditional fossil fuels, and you may be excited to hear the same is true for solar energy.

Lazard’s Levelized Cost of Energy Analysis (https://www.lazard.com/perspective/lcoe2019) measures the total cost of building and operating a facility over its lifetime, and in 2019 found that renewable energy sources, including wind and solar, were beating fossil fuels by increasingly bigger margins. The same report shows that over the last decade, the price of wind energy and solar photovoltaic energy has fallen, on average, by 70% and 89% respectively.

Smart energy: at home, on the road, and in the office

It’s not hard to find examples of the places humans use electricity and energy. It’s so ingrained in everyday life that it might be harder to find places where electricity isn’t used. The good news is that renewable energy could replace traditional fossil fuel-generated electricity across so many use cases.

Utilizing renewable energy at home

Homes that take advantage of smart energy often use internet-connected devices to monitor and track energy usage and implement cleaner energy generators. Think of it like your Google or Alexa speaker, only instead of playing music or telling you what the weather is like, the smart devices make your home the greenest and most efficient it can be.

You may be wondering what tool, technology, or strategy is used to do this, and the answer is that it isn’t just one, but many. One of the best ways to get started is through a smart meter, which is an internet-enabled device that monitors electrical energy consumption, voltage levels, and current, among other things. It communicates this information back to the end-user, who can then make better, more informed decisions about the ways they power the household.

These days, it’s more and more common to see homes with solar panels installed, and it’s estimated that this alone raises the value of a home by about 4%. (https://money.com/home-value-solar-panels/#:~:text=On%20average%2C%20solar%20panels%20raise,home%2C%20according%20to%20the%20study.) If you think about it like this, it’s not only a way to lower energy costs in the short term but also a long-term investment.

Upgrading to smart appliances is another way to optimize a home’s energy efficiency, and while they can be more expensive upfront, it’s very possible they’ll save you money in the long run. Other smart devices and monitors, like those that can turn off lights and monitor leaks (https://www.nytimes.com/wirecutter/blog/smart-home-devices-save-money-energy/), are other ways to implement smart energy solutions into homes with fewer upfront costs — and they’ll likely save you money too.

However, not everything has to be technological to be useful. Simply updating the insulation and windows can make sure heat and air stay in your house and don’t escape into the atmosphere.

Disrupting emissions with electric vehicles

On average, a passenger vehicle will emit 4.6 metric tons (https://www.epa.gov/greenvehicles/greenhouse-gas-emissions-typical-passenger-vehicle) of carbon dioxide. These types of cars work by burning gasoline, which results in the release of harmful chemicals into the environment. In electric vehicles, gas isn’t required to make the vehicle move. Instead, these cars plug into a charging point and take electricity from the grid, which they then store in rechargeable batteries. Some companies are even developing solar-powered electric vehicles, (https://www.wsj.com/articles/solar-power-electric-vehicle-11635259950) which could eliminate the need for the charging station altogether.

The most in-demand electric car is by far the Tesla Model Y, which, in 2021, more people bought than all other non-Tesla electric vehicles combined (https://www.caranddriver.com/features/g36278968/best-selling-evs-of-2021/). Tesla dominates the electric vehicle market, though there are other big players too, including BYD, Volkswagen AG, BMW Group, and Nissan Motors.

Since electric vehicles operate using electricity, from a purely “on the road” perspective, they’re much cleaner alternatives compared to traditional cars. (https://afdc.energy.gov/vehicles/electric_emissions.html) EVs produce the equivalent of about 4,000 pounds of carbon dioxide. On the other hand, gas cars produce the equivalent of about 11,500 pounds of carbon dioxide.

However, it’s important to remember that EVs are the most environmentally friendly when their power comes from a clean, renewable source. Smart (https://www.reuters.com/markets/europe/smart-charging-may-be-key-saving-power-grid-world-evs-2022-02-14/#:~:text=The%20answer%3A%20smart%20charging.,energy%20and%20saves%20drivers%20money.)charging is often the solution to this, which makes better use of renewable energy.

Achieving net-zero in the workplace

The term “net-zero” is an admirable goal that many organizations (and individuals) can strive toward. In essence, net-zero means that the greenhouse gas emitted by a company are equivalent to the amount a company removes from the atmosphere.

Also referred to as carbon neutrality, you may wonder what this actually looks like in practice. The answer is that there’s no one way it’s done. To be considered carbon-neutral (https://carbonneutral.com/how), a company must first calculate its carbon footprint and then reduce that number to zero. This reduction is made through in-house efficiency measures and by supporting external emission reduction projects.

Let’s take a simple office building. On average, (https://terrapass.com/business/small-businesses) an office-based business can generate up to 6 metric tons of carbon emissions per employee per year. For a small office of five people, that’s 30 metric tons of carbon every year. To offset these emissions, a company may introduce smart lighting technology and a smart meter to monitor electricity. The office may also set up a recycling program or optimize travel and delivery routes to minimize emissions. The organization may also fund tree planting through an external partner. Terrapass, an organization that helps individuals and companies offset carbon footprints offers extensive suggestions for ways businesses can offset their emissions (https://terrapass.com/blog/green-your-business-10-ways-to-reduce-your-carbon-footprint).

Recommended reading: 6 ways industrial IoT can benefit modern operations (https://www.hologram.io/blog/6-ways-industrial-iot-can-benefit-modern-operations)

The global impact of smart energy

The global smart energy market is booming and for a good reason. In 2019, the industry was valued at $124 billion and is projected to grow to $253.1 billion by 2027 (https://www.prnewswire.com/news-releases/global-smart-energy-market-2020-to-2027---by-product-end-user-industry-and-region-301257417.html). As such, many countries across the globe are actively investing in smart energy. In fact, over 130 countries have set or are considering setting a goal to reach net-zero emissions by 2050. In 2021, the world invested a collective $755 billion (https://www.weforum.org/agenda/2022/02/ranked-10-countries-energy-transition-investment/) into deploying low-carbon technologies.

Germany and Italy are the most energy-efficient countries in the world, followed closely by France and the UK. According to the American Council for an Energy-Efficient Economy, (https://www.aceee.org/international-scorecard) the United States is the 10th most energy-efficient economy.

The truth is that the Earth is suffering. Since the 1970s, global carbon dioxide emissions have increased by about 90% (https://www.epa.gov/ghgemissions/global-greenhouse-gas-emissions-data#:~:text=Global%20carbon%20emissions%20from%20fossil,increase%20from%201970%20to%202011.). This leads to climate change and devastating impacts on our natural world, including melting ice sheets and rising sea levels (https://www.nature.org/en-us/what-we-do/our-priorities/tackle-climate-change/climate-change-stories/climate-change-frequently-asked-questions/#:~:text=is%20least%20impacted.-,What%20happens%20if%20we%20do%20nothing%20to%20stop%20climate%20change,the%20end%20of%20the%20century.). While not every problem can be solved overnight, smart energy is a step in the right direction. Not only does it save people and organizations money, it means a decreased environmental impact on our world.

Recommended reading: Everything you need to know about IoT smart cities (https://www.hologram.io/blog/iot-smart-cities)

IoT and smart energy

Smart energy solutions are multifaceted. As we’ve looked at, they often start with cleaner energy sources and then get implemented into various parts of daily life. And the key to making so much of this happen is IoT devices. These devices that can monitor and analyze information in real-time and share it with owners or operators who control them are no small deal. We’ve already touched on some use cases, but let's revisit them.

In homes (https://www.nytimes.com/wirecutter/blog/smart-home-devices-save-money-energy/), smart devices like those that control the lights or temperature make it easier than ever to have the most energy-efficient home ever. From smart lightbulbs to smart plugs that reduce “vampire power,” the possibilities are endless. And whether these devices are used in homes or businesses and commercial spaces, one thing never changes, they work because of their ability to connect to the internet.

Electric vehicles can make use of smart charging stations (https://www.nrel.gov/transportation/managed-electric-vehicle-charging.html), which ease strain on the electric grid and make better use of renewable energy sources. With these, owners plug in their cars during expensive peak hours, but the car doesn’t draw power until off-peak hours.

Certain IoT devices like smart meters can also promote good energy practices, including protecting against energy theft and inaccurate billing, protecting energy infrastructure, and optimizing energy usage.

IoT and smart energy: connecting people and power

Smartenergy isn’t just a fun project; it’s a necessary solution for the planet. IoT devices are implemented to monitor, analyze, and optimize energy performance in real-time to make the most of renewable and clean energy sources. But, for these devices to make the world more sustainable, they first need a reliable connectivity solution. With Hologram’s multi-carrier, global network, and agnostic carrier switching, your smart devices will connect to the strongest available signal and stay connected. Learn more about Hologram’s IoT SIM today (https://www.hologram.io/products/connectivity).

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