Discovery Green launches EnergyOS to manage renewable energy procurement risk
New offering aims to turn uncertain renewable supply and pricing into more predictable savings, lower emissions and manageable financial risk.
By Larry Claasen
DISCOVERY Green’s new EnergyOS service allows businesses to better manage energy supply and pricing that comes with sourcing power from the renewable-energy market, where reliability can be uncertain.
With EnergyOS, Discovery Green, a renewable energy trading platform launched by the Discovery Group, is aiming at a specific dilemma for businesses, as they can increasingly procure renewable energy, but struggle to guarantee that it delivers the savings, emissions reductions and financial stability they expected.
“Many businesses typically assess renewable energy procurement based on its price and quantity, treating it as a commodity in a stable world,” says Andre Nepgen, CEO of Discovery Green.
“But this is a dangerously narrow view. The real measure of success is whether that energy delivers sustained savings, manageable risk and meaningful emission reductions across a wide range of potential futures,” said Nepgen at the launch of the service in Johannesburg, in September.
The renewable-energy trilemma
Discovery Green says EnergyOS addresses what it calls the renewable-energy trilemma: maximising savings, reducing emissions and managing financial risk.
Traditionally, procurement has focused on securing supply and an attractive starting price. But that leaves businesses exposed to three uncertainties: how much wind or solar generation they actually get, how their own electricity consumption varies, and how future energy market prices move.
When these factors do not align, the financial outcome can deteriorate sharply.
The group’s research found annual savings can vary by as much as 35% either way for wind and 19% for solar. In some scenarios, expected savings can turn into losses. That matters to finance directors, treasurers and sustainability heads because it can hit the balance sheet, undermine budgets and put decarbonisation targets at risk.
As South Africa’s renewable-energy market grows and becomes more complex, Nepgen argues that securing energy is no longer enough. Businesses need to understand, quantify and manage the risk around it.
Forecasting, customisation and allocation
Discovery Green says EnergyOS, a proprietary operating system, addresses this by forecasting generation, consumption and market prices. It then applies customisation and energy-allocation models to find the best energy allocation for a portfolio of businesses.
Discovery Green says 10,000 consumption simulations, 87 million generation simulations and more than 200,000 future market price points have shown that, on average, EnergyOS produces a reduction of 88% in risk and an increase of 105% in savings relative to traditional procurement approaches, while achieving a 90% reduction in electricity emissions.
This means that, with EnergyOS, a business is not just buying renewable energy; it is managing renewable energy as a strategic asset, so that savings, risk and emissions outcomes are more predictable across a range of possible futures.
A new phase for renewable energy
The launch of EnergyOS comes as the renewable-energy market is entering a new phase, says the group.
It believes that renewable energy can be pooled, modelled and managed, much like the approach taken to manage individual insurance risks.
This begins with forecasting, where millions of potential generation outcomes are considered against thousands of unique energy consumption patterns. These outcomes are tested against an array of future market prices to create a statistical distribution of likely outcomes, instead of a single data point.
“No one can predict with complete certainty how the wind will blow, how the sun will shine, how a business’s electricity needs will change or how the energy market will evolve,” says Nepgen. “The answer is not to pretend that this uncertainty does not exist. It is to understand it, quantify it and manage it more effectively on behalf of businesses.”
