The world is in the midst of a resource challenge. And it could get worse unless companies leverage big data and new technologies to mitigate resource demand.
In many parts of the world, the demand for natural resources is already outstripping available supplies. This is creating an imbalance in access to energy, water, food and materials that’s driving up costs and creating social, political and economic tensions. Population growth will only add to the strain on resources.
Today, 1.2 billion people are living under water stress. According to the Organisation for Economic Co-operation and Development, without additional water conservation and productivity improvements, that number will grow to 3.9 billion by 2050.
Between 2000 and 2009, global materials consumption increased 37 percent, with the largest increases from construction materials. Between 2000 and 2010, global energy consumption increased by 33 percent, with the largest increases from coal. According to an analysis by General Electric, in the absence of resource productivity improvements, both materials extraction and energy consumption will increase 80 percent by 2030.
So what is the world to do? Enter the industrial internet.
According to a new GE report, “The integration of efficient hardware with Internet-enabled software is the new frontier in natural resource productivity. We call this Digital Resource Productivity.”
Combining industrial software with advanced hardware (things like design improvements and new materials) has the potential to transform global resource use. In fact, it’s already happening, said Brandon Owens, strategy and analytics director for GE's ecomagination program.
“When it comes to managing global resource productivity by integrating hardware and software, the game is on,” said Owens.
Since 2012, GE has released 40 industrial internet solutions with many more in the works. For instance, GE’s Flight Efficiency Services, an internet-enabled aviation navigation service, analyzes flight data to design more efficient flight routes and reduce fuel burn. By employing this technology, Brazilian airline Gol Linhas Aéreas Inteligentes realized $100 million in savings over five years.
GE’s PowerUp product, which essentially adds a digital layer on top of a wind farm, analyzes tens of thousands of data points each second in order to fine-tune performance and increase output. Since the European utility E.ON applied PowerUp to its 469 wind turbines, power output has increased by 4.1 percent, the equivalent of adding nineteen additional GE wind turbines.
Software can also enable better grid integration and management of solar assets, said Owens. GE doesn’t currently have a specific industrial application for solar, “but it’s something we’re taking a real close look at,” he said.
Earlier this month, GE announced it will make its software platform that powers the industrial internet, Predix, publicly available in 2015. Opening up the platform will allow other companies to leverage GE's knowledge to create and deploy their own customized industrial apps to better manage the performance of their assets.
"We’re building out the ecosystem by making our platform available to others," said Owens. "That’s one way small and large companies can be a part of this."
Since it was founded in 2005, GE’s ecomagination portfolio has generated $180 billion in revenue. The company has also invested $15 billion in research and development over the same period.
Over the last decade, advances in hardware efficiency and energy productivity have improved at a rate of 1 percent per year. At this rate, global industrial energy consumption will grow from 270 quadrillion British thermal units (Btu) in 2013 to 416 Btu in 2030. If energy productivity was doubled to 2 percent per year, GE estimates that global industrial energy consumption would be held at 346 Btu in 2030. Avoiding those 70 Btu roughly equates to saving more than a third of the world’s annual oil consumption.
In applying the industrial internet, productivity benefits build on each other, said Owens. The combination of efficient hardware and software can not only make a single industrial application more efficient, but also have ripple effects upstream that improve an entire network.
For instance, when Norfolk Southern implemented GE’s Movement Planner technology -- the railroad equivalent of an air-traffic control system -- the railroad saw a 6.3 percent reduction in fuel use and a 10 percent to 20 percent increase in velocity. The ability to move trains faster also allowed the railroad to use fewer trains and spend less capital to operate them across the system.
Of course, achieving accelerated resource productivity comes with challenges. As infrastructure becomes digitized, there’s an increased threat of cyberattack that companies must address. Many industrial applications also take place in harsh environments, perhaps high in the sky or below the surface of the sea, which makes implementing a digital layer very difficult.
As advanced software applications grow, there’s a need to be mindful of the environmental impact of new information technology equipment, as well. GE is addressing this through its data center efficiency program, said Owens.
Still, with a number of technologies now proven and in use, competition in the space is heating up. The use of big data in the industrial sector is already growing at two times the rate of all other sectors.
“It’s hypercompetitive,” said Owens. “The winners that jump into this space and get early-mover advantage will improve their bottom line -- and help the environment in the process."