Press releases

5G empowers smart electricity to drive business model innovation

Published date: 30 November 2021

5G empowers the future of electricity is a report from Deloitte and the Global Energy Interconnection Research Institute (GEIRI) of State Grid Corporation of China. The report reveals that 5G will empower smart electricity and integrate three value creation channels – conventional power services optimization, data-driven services, and energy consumption upgrading. The report also examines how electric power companies are moving from technical innovation to commercial application, and considers several application scenarios, major challenges, and commercialization, highlighting new development opportunities arising from 5G.

"5G-enabled global digitalization revenues for 10 major industries are estimated to hit USD1.3 trillion by 2026, with energy and utilities accounting for the highest share of 19%, about USD250 billion. The electricity sector will be a key area of 5G's vertical application, as 5G communication features are highly compatible with the requirements of electric power communication, and 5G can fully empower smart electricity application scenarios," says Kevin Guo, Deloitte China Energy, Resources & Industrials Industry Leader.

The report notes that many countries have made 5G deployment a high priority while China leads the world in 5G commercialization. With its far-reaching social impact, 5G can generate substantial economic value for the electricity industry. Deloitte expect most electric power scenarios to be built on smart grids, where energy is generated and shared anytime, anywhere. This will promote clean power generation, safe and efficient power transmission and transformation, flexible and reliable power distribution, and diverse, interactive power consumption.

5G+ smart grids will shorten the average power outage time and improve supply reliability and management efficiency. By enabling more application scenarios, it will also boost operational efficiency and transform the grid into an integrated provider of improved services. 5G+ smart grids can also satisfy the energy needs of homes, commercial buildings and factories by supporting new appliances, from distributed new energy and distributed energy storage, to electric vehicles and high-power electric smart machines. The global 5G industry is accelerating standards development and commercial deployment, forming a standard framework and platform for rapidly evolving 5G+ smart grids.

There are four major application scenarios for 5G in the electricity sector: control services, collection services, mobile application services, and new power grid services typified by multi-station integration. In control services, 5G optimizes energy distribution to avoid mass power outages, while enabling online monitoring of real-time, dynamic data in distribution networks. In collection services, 5G drives the collection and provision of raw power consumption across the system. 5G in mobile application services improves safety, reduces environmental pollution, lowers manual inspection workload, and will allow simple hot-line operations. In multi-station integration services, 5G will promote the construction of platform-based sharing companies.

"The transformation from 4G to 5G is more about business model than technology. The business model will shift from B2X to B2B2X, wherein telecommunication operators offer value-added service to power enterprises, playing a central role in new services," says Dr Tony Hu, Dean of Deloitte 5G Next Generation Application Academy. "5G applications will provide three value creation channels for the electricity industry – traditional power services optimization, data-driven value creation, and energy consumption upgrading centered on user demand. As 5G's integration with the electricity sector accelerates, companies will leverage their resources and strengths while working together to explore viable business models." 

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