28 NOVEMBER 2023www.pwc.com/energyopportunityThe energy-demand opportunity: How companies can thrive in the energy transition by Jon Chadwick, Samantha Vincent, Reid Morrison, and Rob Turner Organizations face an energy trilemma involving costs, carbon emissions, and supply uncertainty. But energy system advances can help them create value and become more sustainable and resilient—by taking charge of their energy demand.Traditional energy systemCentralized fossil fuel power plants generate electricity, which flows in one direction to customers; energy supply is typically reliable but emissions-intensive.SupermarketDatacenterConsumersFossil fuelpower plantsGenerationTransmission anddistributionResidencesBusinesses3 | www.strategy-business.comproduce and bank electricity to avoid shortages and surging prices. And the digitization of facilities and equipment helps organizations manage their energy use with more precision, reducing costs and guarding against risks.The combined impact of decarbonization, decentralization, and digitization means organizations that once functioned mainly as energy consumers can now play the dual role of producer–consumer. These energy “prosumers” might still purchase electricity from the grid—only now, they can also produce their own electricity, store it, and sell it. And they can use data and technology to modulate their energy demand and time their energy purchases and sales to match favorable market prices.DecentralizationBusinesses and households install small-scale renewables and batteries; bidirectional flow of electricity to and from decentralized assets requires investment in network infrastructure.Businesses withsolar and batteryinstallationsOnshorewindUtility-scalebattery storageResidentialsolar installationsDecarbonizationUtility-scale renewables (e.g., solar, wind) are introduced, starting the phaseout of fossil fuel power; this reduces emissions but creates some supply instability.Offshore windNuclearpower plantLarge-scalesolarResidencesBusinessesHydropowerSupermarketData centerFossil fuelpower plant4 | www.strategy-business.comDigitizationInternet-of-things devices help coordinate decentralized energy assets; energy users manage demand to achieve savings, use more renewable power, and support grid stability.5 | www.strategy-business.comHow an Australian industrial park created value by changing its approach to energy demandTo understand how companies can create value by managing their energy demand, consider the example of Moorebank Logistics Park (MLP), Australia’s largest intermodal freight facility. Like other large industrial organizations with significant energy demand and ambitious carbon-neutrality goals, MLP and many of its tenants are seeking to reduce the Scope 2 carbon emissions that result from their use of purchased electricity. The facility’s ownership consortium also recognized that such All told, actions that organizations take to manage their energy demand w...
