The digital energy revolution? Charge it with values!

The standard by which digitized power systems will be judged is their compliance with the environmental and social goals of the transition to renewable energy. The following is a contribution to the highly controversial debate on digitization and sustainability.

Ethical aspects do not feature prominently in the technocratic and business-driven debate about the digitization of the power system. “Convenience” and “joy of use” are frequently cited, as is the contribution digitization will make toward the cost-effectiveness of companies. The goals of the energy transition, i.e.

• a life-friendly, ecologically-oriented power supply
• broad social participation, co-determination and
• ​a decentralization of the power system

and how they can be achieved through digitization tend to be lost from view. This also means that the dark sides of digital technologies, such as a new scale and quality of extractivism, continue to be neglected. The only ethical aspect that is taken into account is privacy. But precisely because the energy transition cannot be realized without digitization, it is high time to lay an ethical foundation for it.

1. Greening and limiting: efficiency, consistency and sufficiency are the triad of the digital energy transition.

This is not just a normative guardrail, but a de facto physical necessity in a world with limited resources. A power system is ecologically sustainable if it does not overuse natural resources such as soil, water and the atmosphere.[1] 

The key technologies of the energy transition – solar, wind and batteries – rely on rare earths and high-tech metals. The largest deposits of these raw materials are typically not in industrialized countries, but in Latin America (copper, iron ores, silver, lithium, manganese, etc.), in African countries (platinum, bauxite, manganese, etc.) and in Asian countries (rare earths, mainly in China). The hardware of digitization – smart phones, servers, hard drives, displays and the like – is resource-intensive. So-called (digital) future technology requires materials such as lithium, rhenium, terbium, germanium, cobalt, scandium and tantalum, leading to skyrocketing worldwide demand. The international rush for these raw materials has long since begun, leading, for example, to the undersea mining of manganese at a depth of 4,000 meters, putting fragile ecosystems in great jeopardy.

Exercising technological moderation

Is metal recycling a solution here? Yes and no. It is certainly more environmentally friendly to reclaim metals than to downcycle or dispose of them. Firstly, however, recycling is only the third-best solution within the waste hierarchy[2], after waste avoidance and repair. Secondly, the recycling potential of many new technologies related to the power system (e.g. smart meters, fuel cells for mobile devices) is limited. Other materials and technologies (fiber optic cables, white LEDs, RFID chips, carbon touchscreens) cannot be recycled at all.[3] Urban mining, cradle-to-cradle and economical intra-technology choices are cited as ways of reducing the ecological footprint of renewable energy infrastructure. Thanks to technological innovation, there will probably be additional possibilities in the future to make the hardware of the digital energy revolution more environmentally friendly. However, counting on as-yet nonexistent techno-fixes to solve the socio-ecological resource and waste problem at some point down the road would be a grave mistake.

In addition, attention should be given to how sufficiency can be designed into the (digital) energy transition. Regulatory instruments and market incentives must be provided as soon as possible to reduce and avoid digital and material ballast.

2. Broad participation: the diversity of actors is characteristic of the German energy transition. A broad civic base is a value in itself that should be preserved in the course of digitization.

Energy cooperatives increase the acceptance of renewable energy projects and contribute to regional value creation. The citizens’ energy initiative forms a bridge between the transition to renewable energy as a technology project and the desire for social participation. The generators and users of electricity are digitally linked in a virtual power plant. Digitization is transforming citizens into flexible producers and consumers of energy. Marginal costs can be reduced using automation and algorithms, making action even on a small scale worthwhile.

What kind of political framework will this require? Which political conditions will contribute to a level digital playing field for corporations and the citizens’ energy initiative? 

Digitization for citizen-oriented and decentralized power systems

The expansion of broadband must be promoted by the government, ideally in conjunction with the expansion of power grids. Modern communication networks and grids are crucial to a decentralized, citizen-oriented transition to renewable energy. If a public utility company is going to dig up a road anyway, the opportunity should be used to lay all of the needed lines directly.

Decentralized, regional and local consumption communities must be relieved of levies and taxes. In Germany, the use of self-generated electricity must be exempted from the Renewable Energy Sources Act levy. So-called tenant electricity models must be expanded to residential areas and commercial tenants.

Digitization is an opportunity to diversify the energy industry and make it resilient. The current regulatory framework often still favors the established players, however. For example, much of the power data is only available to certain market players, such as grid operators. An open data base could reduce system costs. The downside is that such transparency would make the system more vulnerable, requiring investment in cybersecurity.

3. Clean energy supply, digitization and data privacy must be considered together. The primacy of data economy must apply at all levels.

The smart meter – which tracks how much power was generated and consumed and when – is the flagship technology of the digitized power system. Its data is transmitted directly to the metering operator, generally the local grid operator. This eliminates the annual meter reading date. Furthermore, consumers can use suitable software to analyze the data and optimize their power consumption. When numerous producers and consumers have smart meters that exchange data automatically, this gives rise to a smart grid. This increases energy efficiency, creates potential savings and – as explained above – is essential to build the flexibility necessary for 100 percent renewables.

In Germany, the Digitization Act of August 2016, which in turn is based on the EU’s General Data Protection Regulation, provides the legal basis for the gradual installation of smart meters. This law is seen critically by privacy advocates. The fact that the German Federal Office for Information Security (BSI) has developed the highest security standards for smart meters and smart meter gateways has not satisfied critical voices. And it is true that in theory, anything can be hacked. The power consumption data generated by smart meters can, in principle, provide insights into the lives of consumers. There is a fundamental risk that the analysis, use, collection, exploitation and marketing of the data will endanger the informational self-determination of consumers. This results in a smoldering conflict of objectives for the digitization of the power system.

Table 1: Agora Energiewende (2016) Energiewende: Was bedeuten die neuen Gesetze? Zehn Fragen und Antworten zu EEG 2017, Strommarkt- und Digitalisierungsgesetz (The transition to renewable energy: what impact will the new laws have? Ten questions and answers on the 2017 German Renewable Energy Sources Act, Electricity Market Act and Digitization Act), Berlin, p. 26

How to contain the smoldering conflict of objectives between data privacy and system openness

The Greens are calling for energy data to be kept secret and for data to be strictly earmarked, for the informal right of self-determination over one’s own data to be enforced and for consumers to be sufficiently informed and educated. The irreversible anonymization and earmarking of energy data could be tested in pilot projects by federal and state governments. Innovative data protection concepts such as privacy by design and privacy by default should be given stronger political support and incentives for investments in good data protection on the part of the state.

Data security is a further work in progress. Events such as the hacking of the German parliament and railway system bear witness to the fact that even critical infrastructure is never completely secure. Such attacks are seen as foretastes of possible disasters, as popularized in Marc Elsberg’s novel "Black Out", in which hackers use the internet for the wholesale installation of malicious code on smart meters and push the entire Western world to the edge of the abyss. What conclusions or demands arise from this?

4. The following points summarize the normative requirements for the digitization of the power system:

1. Digitization depends on preconditions that it cannot itself create. The preservation of natural, analog resources is the benchmark for good or bad digitization. Digitization must be put at the service of this objective.

2. Digitization is a powerful tool. It is not a value or end in itself, however.

3. The digitization of the power system must be reconciled with the ecological idea of ​​the transition to renewable energy. Ecological governance must set an ecological course for digitization.

4. Digitization has the potential to broaden the social dimension of the power system. Decentralized prosumer models are simplified by smart networking. Digitization should contribute toward maintaining the diversity of actors in the power system, with the ultimate goal of creating a more democratic power system.

5. Digitization and data privacy are not complementary by nature. A flexible power system based entirely on solar, wind, etc., requires real-time information about user behavior in order to function. Energy experts and data privacy advocates need to agree here on a pragmatic approach to data regulations.

[1] The word ecology itself infers moderation as a guiding principle: “Ecology” is the science of the economy of animals and plants (from the ancient Greek οἶκος oikos: “house”, “habitation”, and λόγος logos: “science”; i.e. “the study of housekeeping”). This housekeeping – in other words, these policies of limitation and moderation – must be designed to lead to positive social developments. The ecological question must be linked to the social question in an integrative and systematic manner.

[2] European Union (2008): Directive 2008/98/EC of the European Parliament and of the Council of 19 November 2008 on waste and repealing certain Directives (Official Journal of the European Union. 22 November 2008, Article 4, http://eur-lex.europa.eu/legal-content/en/TXT/HTML/?uri=CELEX:32008L0098, accessed on October 16, 2017

[3] Deutsche Rohstoffagentur (DER) (2016): Rohstoffe für Zukunftstechnologien (Raw materials for future technologies), Berlin, PDF version: https://www.deutsche-rohstoffagentur.de/DERA/DE/Downloads/Studie_Zukunft..., accessed on July 26, 2017, International Bank for Reconstruction and Development/The World Bank (2017): The Growing Role of Minerals and Metals for a Low Carbon Future, New York. PDF version, http://documents.worldbank.org/curated/en/207371500386458722/pdf/117581-..., accessed on July 27, 2017