Meeting The Global Resource Challenge
How ecomagination and the Industrial Internet can create a new world of Digital Resource Productivity
By Brandon Owens, Strategy and Analytics Director, GE ecomagination
A great global resource challenge is upon us. The demand for natural resources is outstripping available supplies in many regions around the world. Regional resource imbalances are occurring for energy, water, food, and materials. These imbalances are driving up commodity prices and creating resource stresses that have social, political, and economic implications.
The global resource challenge is poised to become even greater in the years ahead. Expected increases in gross domestic product (GDP) and population levels over the next 15 years will translate into even stronger levels of resource demand. Our analysis indicates that in the absence of additional improvements in the intensity of resource use per dollar of GDP, both materials extraction and energy consumption will increase by 80 percent by 2030. Further, according to the Organization for Economic Cooperation and Development (OECD), without additional water conservation and productivity improvements, the number of people living under water stress will grow from 1 billion today to 3.9 billion in 2050.1
Additional solutions are needed to hold resource demand in check without risking human or economic development.
Enter the Industrial Internet. By combining remote sensors, communications technologies, and cloud-based computing with industrial machinery, the Industrial Internet opens new avenues for increasing the productivity of the global industrial complex. The integration of industrial hardware with Internet-based software enables more efficient management and use of human, capital, and natural resources within industrial machines, fleets, facilities, and networks. The Industrial Internet enables resources to be optimized across the entire industrial system.
Combining solutions from the Industrial Internet with ecomagination, GE’s commitment to developing technologies that reduce our consumption of natural resources, while creating economic benefit for our customers, could play a key role in solving the global resource challenge. The integration of efficient hardware with Internet-enabled software is the new frontier of natural resource productivity. This approach provides an avenue to achieve resource productivity improvements above and beyond those that can be achieved through hardware advances alone. We call this Digital Resource Productivity, and we believe that productivity improvements can be doubled over the next 15 years by integrating software and hardware to optimize resource use.
Resource productivity improvements of this magnitude would have major implications for global industrial energy consumption. Over the last decade, through advances in the efficiency of hardware, energy productivity improved at a rate of 1 percent per year. If this same rate were to persist through 2030 as expected, global industrial energy consumption will grow from 270 quadrillion Btu (quads) in 2013 to 416 quads in 2030. However, if the rate of energy productivity improvement is doubled to 2 percent per year through the combination of efficient hardware and Internet-enabled software, then global industrial energy consumption will be held to 346 quads by 2030. That represents a reduction of 70 quads, which is equivalent to roughly 12 billion barrels of oil — or just over a third of the world’s annual oil consumption.
Digital Resource Productivity is not just a vision of the future — it is here today. Industrial Internet solutions developed by GE are already at work improving resource productivity for our customers. Since 2012, GE has released 40 Industrial Internet solutions with many more on the horizon. All of them are part of the Predictivity™ suite of solutions, which is now included in the ecomagination portfolio.
Consider GE’s PowerUp solution, which is available for wind turbine models across GE’s installed base and is part of GE’s ecomagination Brilliant Wind™ turbine platform. PowerUp harnesses the Industrial Internet to drive higher power output and create new revenue streams for wind farm operators. PowerUp analyzes tens of thousands of data points in a wind farm every second in order to fine-tune performance and increase output. PowerUp is already at work in the field, improving wind turbine performance. For example, since European utility E.ON’s 469 wind turbines enrolled in PowerUp, power output has increased by 4.1 percent, the equivalent of adding 19 additional GE wind turbines.
Also consider GE’s Flight Efficiency ServicesTM, an Internet-enabled aviation navigation service that examines flight data to design more efficient flight patterns. The result is a reduction in both fuel consumption and flight miles. Brazilian air- line Gol Linhas Aéreas Inteligentes has employed Flight Efficiency Services and has already realized US$100 million in savings over five years. They have saved an average of 22 miles per flight and 77 gallons of jet fuel per flight, and have reduced CO2 emissions by 1,628 pounds per flight.
Another example is GE’s Movement Planner™, which is the railroad equivalent of an air-traffic control system. The Movement Planner is breakthrough technology enabling more locomotives to run on the same railroad track at faster speeds and with greater efficiency — without laying new track. In the United States, Norfolk Southern has implemented Movement Planner along its entire 20,000 route miles in its 22-state rail network. Deborah Butler, Norfolk Southern’s chief information officer, says her railroad has seen a 6.3 percent reduction in fuel usage and 10–20 percent increases in velocity by installing Movement Planner on its network.3 In general, better velocity also means better capital utilization — when trips are faster, the railroad needs less capital equipment to operate them. This saves even more resources.
These examples represent a handful of hardware and software solutions within GE’s ecomagination portfolio. Whether it’s reduced jet fuel consumption, lower natural gas use, diesel fuel savings, reductions in water consumption, or increases in wind power — each of these solutions provides direct benefits that enhance resource productivity. And this is just a sampling, with many more innovations on the horizon. That’s the most exciting part — the journey has just begun. A new world of possibilities is being unlocked through the Industrial Internet . Software solutions commercially available and under development are just the tip of the iceberg. That’s why we believe that the integration of ecomagination hardware and software has the potential to double the future rate of resource productivity improvement .
At GE, we are excited about the opportunity to play a role in helping to confront the global resource challenge. Today we are embarking upon a new frontier of Digital Resource Productivity by expanding ecomagination to encompass GE’s Predictivity suite of solutions. Join us as we help transform the future of global resource productivity.
Established in 2005, GE’s ecomagination program has been at the forefront of resource productivity solutions for a decade. Since its founding, the GE technologies and solutions in the ecomagination portfolio have generated $180 billion in revenue. GE has maintained its commitment to efficient resource solutions by investing $15 billion in research and development over this period.
Brandon Owens is an economist, energy analyst, researcher, and writer. His research has been pub- lished in industry-leading journals such as INFORMS, Public Utilities Fortnightly, Energy Policy, and Research Evaluation. A keynote speaker and expert witness, Mr. Owens has been cited in periodicals such as the New York Times and USA Today.
