With recent years seeing a whirlwind of activity in the energy transition, many have been looking for a clear organizing principle to help guide thinking about the transition and to help understand new innovations. At the recent CERAWeek Innovation Agora, the following three categories emerged as just such a principle: green electrons, green molecules and green bits. They encompass all the ways energy manifests in the modern world, including how cutting-edge technology is upending long-held patterns and assumptions.
Each category defines a unique element of the transition, with important overlaps. The first two address the supply side of the transition, while the third is an essential element of both the supply and demand sides.
- “Green electrons” produce electricity from non-emitting sources—largely wind and solar. They traverse wires to reach the end-user and may be stored in batteries for future deployment. In a perfect world, they provide 100% primary energy for the entire global economy, including to power processes that create the next category—green molecules.
- “Green molecules” store energy for future use, akin to how hydrocarbons stored in oil, gas and coal operate today. Their lifecycles—from generation to combustion—produce negligible, zero or negative quantities of greenhouse gases. They include hydrogen and synthetic fuels, and they will be essential for several heavy industries and fields like aviation for the foreseeable future. They can leverage much of the existing infrastructure of “grey” molecules, such as pipelines.
- “Green bits” refers to the digital services that will underpin the energy system of the future. Their applications are myriad, ranging from optimizing the performance of energy production assets to managing energy use in buildings, vehicles and factories to boost efficiency.
The essential task of the next decade and beyond will be to imprint the “green” label indelibly across the first two categories, while ensuring that they leverage the full benefits of the third category. While the trajectory is promising, none of this can occur without continued innovation. This is why Emerald aims to invest in all three pillars—examples include eologix, which helps wind turbine operators reduce maintenance costs and downtime, and enspired, an energy trading platform that helps operators supercharge efficiency.
At the same time, we are helping those innovations scale via engagements with some of the biggest players in the energy ecosystem. Our limited partners, including Chevron, Sasol and Orlen, form the backbone of today’s largely fossil-driven energy economy, and they are keen to embrace a more sustainable future. As the pace of change in the energy transformation accelerates, linking them with startups, inventors and pioneers working across the three pillars will be essential.