23 Nov 2022
Times are tough for small businesses in the UK. Many businesses bruised by the impact of Brexit and Covid-19 now face an energy crisis. According to the SME Insights report from Simply Business, more than half (54%) of UK SMEs are at risk of collapse from rising fuel and energy prices. Now, with more energy and cost-conscious customers reining in their spending, pressure is mounting for businesses.
Artificial intelligence (AI), with its ability to deliver critical insights at unimaginable speed and scale, has emerged as a key tool for survival. By enabling businesses to optimise energy usage, it can help them achieve green, net zero targets and reduced costs. Indeed, AI is set to play a vital role in the move to "low-emissions, ultra-efficient and interconnected energy systems," according to the World Economic Forum.
With the energy crisis driving increased interest in renewable energy, businesses operating within the AI and energy sectors are attracting serious investment. Green energy provider Octopus Energy is the UK's most generously-funded start-up of 2022, with $1.5 billion (£1.3 billion) of investment fuelling its AI-based developments. Also attracting big investment is Google-acquired neural networks pioneer DeepMind, which is using AI to safely explore the potential of clean, affordable nuclear energy.
Most business uses of AI and machine learning (ML) draw upon the technology's ability to utilise huge amounts of data to predict patterns and drive impactful decision-making. In the energy sector, this data is relatively easy to access. Data regarding energy costs, for example, is now available publicly and utilising said data, technologically innovative energy suppliers can train their AI to help businesses make good decisions about their energy usage – regardless of the macroeconomic environment.
A wealth of data is also available from smart meters, which, according to the UK Government, are now used in 30 million homes and small businesses in the UK. AI can analyse this data in real time to reveal how home and business customers consume energy, and then suggest efficiency savings that may not be obvious to the user.
AI can also help businesses draw up forecasts of future usage and bills under hypothetical scenarios, such as a hike in oil prices or the removal of an energy cap. The user may then tweak their energy usage to cut their bills and reduce their carbon footprint, and even build monthly or quarterly forecasts. With enough data and well-designed algorithms, AI predicts outcomes with amazing speed and accuracy, easing uncertainty for firms and potentially keeping them in business.
Let's now take a closer look at some of the UK firms using AI to help us keep the lights on, sustainably and affordably.
At just seven years old, Octopus Energy is already the sector's leading technological innovator. AI and data science are at the heart of its success.
The firm's cloud-based platform Kraken Flex uses AI algorithms and machine learning (ML) to find the most cost-effective and sustainable electricity for its 3.1 million customers in the UK. By automatically matching supply and demand, Kraken helps the electricity grid handle even the most unpredictable market volatility. In fact, worldwide, Kraken supports more than 17 million businesses and home users, thanks to licensing deals with companies including E.ON and Australia's Origin Energy. EDF Energy is also expected to join them in 2023.
Octopus is now building on the success of Kraken with a new data science and AI hub, headquartered in Manchester, where it's developing smart grid systems that automatically deliver energy when the grid is greenest. As such, the company is seeing serious business benefits from its innovations, and in 2021, revenue rose from £35 million in 2017 to £2 billion. Today the group is currently valued at around $5 billion.
UK firm Limejump also sees the use of data and technology to deliver sustainable energy as "a revolution for positive change". Its engineers have developed an AI-driven virtual power platform that aggregates renewable energy sources and storage assets of different sizes and technology types in real time. The end result is that it delivers 100% renewable energy at all times, at optimised cost to customers. A no-brainer for net zero.
AI research lab DeepMind has come a long way since its London-based engineers created Atari-playing neural networks – technology that Google then used to slash its data centre power consumption (and energy bills). Fast forward to 2022, and DeepMind is now aiming to help solve the global energy crisis by turning nuclear fusion into a realistic source of clean energy.
The firm has teamed up with the Swiss Plasma Center to develop the first deep learning system, enabling it to autonomously and intelligently control the plasma inside a nuclear fusion reactor. In the world of renewables, nuclear has long been mooted as the affordable energy source of the future, but even the smallest human error can have devastating consequences. DeepMind's AI may finally be the technology to unlock previously-impossible uses, and give the world an infinitely renewable source of clean energy.
The irony of AI's role in reducing energy bills is that AI itself is a big energy user. But again, new UK start-ups have found the answer and created a world-first. AI optimisation company TurinTech has developed a platform, evoML, which automates the whole process of creating, optimising and deploying machine learning. In turn, the time and resources required to support the process are reduced.
This is potentially game-changing in a world where technology dependent on high performance infrastructure must be sustainable, and it will undoubtedly make AI-based energy solutions more accessible to businesses of all sizes. Moreover, as the UK continues to position itself as a leader in tech, it’s good to know that as far as renewable energy goes, we’re in the hands of some of the greatest minds in the world.