Flexibility is the sharing economy for electricity
Some of the most successful recent technology startups derive their success from enabling a sharing economy. Companies such as Uber or AirBnB allow their customers to share otherwise under utilised assets on a peer to peer basis.
The sharing economy is a win/win/win - consumers get access to cheaper services, receive income for their otherwise unused assets and the businesses that enable the sharing economy grow without building assets themselves. This capital-lite way of improving economic productivity creates happy customers, efficient economies and exponential business growth.
The energy industry is notoriously capital intensive. Our transition towards a clean and renewable future requires massive amounts of capital to build wind turbines, solar panels and storage. These technologies are characterised by low marginal costs after they are built - but high capital and project costs before they are built.
There is one business model that can enable the sharing economy in electricity systems - flexibility. Flexibility is the shifting of electricity consumption from periods of high prices to low prices. It's an asset that is hidden in industrial and commercial sites around the globe. Today flexibility is massively under utilised.
Take a university generating cooling for their campus. By sending signals to the chiller plant to reduce (or increase!) cooling generation at the correct times, the university can lower the cost to supply cooling to their campus while maintaining the comfort of students and faculty.
This sharing of the flexibility asset with the grid means we don't need to fire up expensive and dirty peaking plants during times of high demand and prices. It also allows us to make use of excess renewable generation when it's available. This previously unused flexibility asset doesn't require us to build anything new - yet it allows us to reduce cost, cut carbon and help keep the lights on during times of stress.
At Tempus we offer a platform where we allow previously passive customers to utilise their capacity to be flexible - and get paid for doing so. We use artificial intelligence to understand what the correct action is for your flexibility asset at each hour of the day. We allow consumers of electricity to become active participants in the electricity system, supporting the grid, the deployment of renewables and their own bottom line. It's a win/win/win.
Adam Green, Data Scientist