Could the ‘Industrial Internet’ be the Key to Renewable Energy and GHG Reductions?


The Industrial Internet, or the Internet of Things, promises to save energy and reduce industry’s environmental impacts through machine-to-machine (M2M) communication, says an AT&T-sponsored report by Carbon War Room, a research organization focused on the climate challenge. The report says that by 2020, M2M and information and communication technologies (ICT) could reduce greenhouse gas (GHG) emissions by 9.1 gigatons (Gt) carbon dioxide equivalent (CO2e) annually. That’s an impressive figure, equal to 18.6 percent of global GHG emissions for 2011.

The vision of an Internet of Things appeals to Jeffrey Immelt, CEO and Chairman of General Electric, who writes at GigaOM that he expects to see in the near future “an open, global fabric of highly intelligent machines that connect, communicate and cooperate with us.” He believes this “Industrial Internet” is “about combining the world’s best technologies to solve our biggest challenges,” developing “economically and environmentally sustainable energy, curing the incurable diseases, and preparing our infrastructure and cities for the next 100 years.”

Carbon War Room predicts that 12.5 billion M2M devices will be operating worldwide by 2020, up from only 1.3 billion today. The M2M industry is growing at an impressive 23 percent per year, meaning it could mushroom from a $121 billion business today to $948 billion by 2020. China is leading the world in incorporation of M2M into national infrastructure.

M2M technologies allow companies to improve efficiency in energy and use of resources and to reduce waste. The Carbon War Room report focuses on the potential for the Industrial Internet to reduce GHG emissions in the key sectors of energy, transportation, the built environment, and agriculture. The group believes that these technologies could save over 2.0 Gt of CO2e by 2020 in the energy sector by facilitating the operation of smart grid, smart meter, and demand-response systems, by improving efficiency in energy production and transmission, and by expediting the switch to renewable energy.

M2M communication is made possible by embedding sensors and microprocessors in machines and other objects; the sensors generate data about a machine and how it is functioning. Those data are sent out over (usually wireless) networks to central computers and back-end IT infrastructure that analyze and act on those communications, sending instructions back to the machine to alter and optimize its behavior. “The core capabilities of M2M,” says the report, “are to reduce human error, save time, increase efficiency, conserve resources, and generally optimize the performance of a physical system — all of which also save money.”

M2M has important implications for the integration of renewable energy into electric grids. As an example, Jürgen Hase, who leads the international M2M business for Deutsche Telekom, points out that “When there is a steady, strong wind, many local wind farms generate more electricity than is needed in the locality.” The problem here is that “if too much electricity is fed into the grid, it threatens to collapse.” The solution, he says is to “let M2M modules on the transformers in the substations measure constantly how much electricity is fed into the grids. If it is too much, the modules simply cut off the overproduction.”

A report from the Boston Consulting Group (BCG) in partnership with the Global e-Sustainability Initiative (GeSI) outlines some important ways that the Internet of Things can help reduce GHG emissions in the power sector and to create a better environment for integrated renewable energy into the power supply. The BCG report discusses the GHG abatement potential of information technologies in the complex areas of smart grid, demand management, time-of-day pricing, power-load balancing, power grid optimization, virtual power plants (VPP), and the integration of renewables on-grid and off-grid, as well as energy storage.

The VPP concept requires the kind of real-time automation that will only be achievable with M2M networks. BCG defines the virtual power plant as “an emerging technology that combines a cluster of distributed generation installations (such as rooftop solar, microCHP, micro-wind, small scale storage, etc.), typically at the neighborhood/local level, and runs them collectively.” A VPP is an highly complex system, and communications technologies make it manageable.

Some of the most advanced work in VPPs is being done in Germany, where the government plans to switch to 80 percent renewable generation by 2050. According to German technology giant Siemens, this will require the harnessing of “millions of solar, wind, biomass, and small-scale combined heat and power plants [CHP]” to “form a diverse energy network” linking together those disparate sources into unified and coordinated systems.

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