Demystifying clean energy: 6 crucial questions for energy manufacturing companies

In an exclusive interview with Energy Connects Quarterly Review, John Nixon, Vice President, Energy, Chemicals and Infrastructure at Siemens Digital Industries Software, clears the air on clean-energy-related questions from Siemens partners and customers to help energy businesses use software and digitalisation to thrive in today’s fast-changing clean energy landscape.

The energy transition is most associated with renewable energy sources like solar and wind. But what are some opportunities it provides for more traditional energy sources like oil and gas?

Oil and gas companies face increased scrutiny around their emissions and contributions to climate change. At the same time, technologies developed during the energy transition offer great opportunities for traditional oil and gas providers to dramatically improve operational efficiency and productivity.

To remain competitive and profitable, businesses can invest in new technologies like the executable digital twin to gain a remarkably detailed understanding of the complete lifecycle of the assets they operate and the products they produce.

Whether a business produces renewable energy sources or fossil fuels, its Chief Financial Officer (CFO) must be able to understand the immediate and long-term financial impact of all activities. Adopting technologies like design space exploration gives CFO’s access to rich scenario analysis tied to financial modelling, which we call model-based financial optimisation (MBFO). Inside a user-friendly digital environment known as the industrial metaverse, CFOs can observe a direct relationship between real asset performance and financial performance. It’s become possible to quickly understand the journey from energy molecules, whether wind, oil, nuclear or solar, to your financial EBITDA margin.

How do you expect the energy transition to impact energy production levels?

Different organisations, such as the IEA, OPEC and others, have varying projections for energy production levels. As our species goes through the energy transition globally, we have to embrace the electrification we’re investing in while also making sure we keep the lights on.

Conventional oil and gas production levels will remain the same or may actually increase in the short term as we make deeper investments in energy sources such as hydrogen, wind, solar and advanced nuclear, including small modular reactors and nuclear fusion.

Simulation has become much more powerful and effective over the last few years. What role can power plant simulation and manufacturing simulation play in reducing emissions?

Because of huge investments in the cloud, simulation today is no longer limited by computational power. Manufacturing simulation in particular has been a deep investment for Siemens Digital Industries Software. The same challenges in molecular reactions, asset performance and emissions management for manufacturing facilities are in fact, challenges we find in power plant simulation.

Businesses now have the ability to simulate with high fidelity and take advantage of massive improvements in analysis capability that can be done in a fraction of the time. This allows them to explore options at orders of magnitude greater than just five years ago. It also enables real-world improvements where emissions are actually created. The power and fidelity we have today, and the trust we have in simulation, is constantly improving.

How does design automation speed up the engineering design process for clean energy capital assets like wind turbines, solar farms, hydrogen power plants and small modular reactors?

Design automation, and what we refer to as design space exploration, provides a collaborative digital environment that integrates all your engineering disciplines, including civil, structural, mechanical, geospatial, electrical, and more and offers a greater systems-based approach. It helps us understand how the smallest design changes can have the greatest impacts on asset performance. We are seeing dramatic improvements in both the speed and quality of capital asset designs created using this systems-based approach.

How can energy businesses reduce carbon emissions produced by their capital assets?

Our species is trying to reduce carbon emissions, as well as productivity and material waste, when we are constructing and operating capital assets. At Siemens, we call this Capital Asset Lifecycle Management. It’s a connected, holistic approach to understanding requirements, design, construction and operations, plus the emissions and waste that are associated with these activities.

When energy businesses and equipment manufacturers invest in digitalization and Capital Asset Lifecycle Management, you have an environment where you can proactively strip away great volumes of emissions and waste. This can be performed through visualizing, navigating and optimizing your processes, programs and project execution using a “digital twin,” which is a data-driven, visually-navigable digital representation of the physical reality of your asset portfolio.

What’s your number one piece of advice for energy companies and energy equipment manufacturers who want to become more sustainable?

Sustainability is the first and most important consideration for energy companies and energy equipment manufacturers. Considering what we’ve highlighted above with investments in digitalization, addressing sustainability starts on the drawing board. And the best drawing board is a digital one.

When you start with digitalisation, it’s the best use of your investment. It helps energy businesses realise optimal performance, profitability and sustainability. Sustainability is profitability, and digital investments drive sustainability.