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3 Disruptive Technologies To Combat Global Warming

Anton Kroger

Climate change is arguably the biggest challenge facing the planet today. In my opinion, politicians, scientists, and energy consumers need to embrace 3 distinct disruptive technologies in order to drive change quickly enough to avert this impending global disaster.

EIA (Energy Information Agency) data tells us that the total CO2 emissions from carbon-based fuels has increased from about 21.45 billion metric tons in 1990 to 33.96 billion metric tons today. The EIA forecasts that emissions will reach 43.22 billion metric tons by 2040 if we continue what we are doing today.

Figure 1. Historical and forecasted CO2 emissions

CO2 emissions alone don’t actually tell us that much about pollution. To learn more, we need to convert the EIA figures to parts per million (PPM) .

We are at the 400 ppm mark today, and if we continue as usual we should hit 460 ppm by 2040. 400 ppm is considered by many scientists to be the maximum level that the ppm count can get to and maintain global warming averages below a 2 degC rise. Above this, the chances of capping global warming to 2 degC diminishes, as is shown in the next figure.

Figure 2. Calculated PPM curve – calibrated to the Keeling curve

So the question now is: How quickly do we need to reduce carbon emissions in order to reduce the likelihood of increased global warming?

Based on my own model and calculation, there are 3 possible scenarios, shown in Figure 3:

  1. We continue as we are today, with little change and an increasing demand for energy supplied by fossil fuels
  2. We reduce our carbon-producing footprint at a rate similar to what was created
  3. We drive a completely disruptive approach to reduce our carbon emissions

In order to reach zero emissions by 2050, we would need to reduce our carbon emissions by at least 10% year on year, which is a huge reduction.

Figure 3. Three possible outcomes for CO2 emissions

We again convert this to PPM, and Figure 4 shows that the only way is rapid disruption. Outcomes of global discussions for the most part only seem to have targets returning to the 1990 averages by mid-century, which is simply too slow. Some countries have adopted a more aggressive approach, which is good, but probably not enough to get us across the line.

Figure 4 – Three possible outcomes for CO2 emissions (PPM)

So the results are  clear: We must act very quickly. The question is what technology or combination of technologies can get us there in short timeframe. There is long-term stable nuclear, solar, wind, hydro, or of course a combination of all these, and storage is a also major part of the equation.

The challenge for governments is where to focus and what legislation or projects to back to ensure that change happens quickly enough. The problem today is that change is happening at a sustaining rate rather than a disruptive rate (Scenario 2). This means change is simply happening too slowly. We therefore need to shift our attention away from sustaining technology enhancements and look for disruptive ones.

The difference between disruptive technologies and sustaining technologies is probably best described by Clayton Christensen in his book, The Innovator’s Dilemma:

Sustaining technologies improve the performance of established products, along the dimensions of performance that mainstream customers in major markets have historically valued. Disruptive technologies bring to market a very different value proposition than had been available previously. Generally, disruptive technologies underperform established products in mainstream markets. But they have other features that a few fringe (and generally new) customers value.”

When we apply this thinking to renewable energies, there are two vital requirements that need to come together to drive a truly disruptive change:

  1. The technology needs to have new features that appeal to customers in a different way
  2. The technology needs to have a completely different revenue model or value proposition.

In my opinion, there are 3 technologies that need to come together to deliver these two vital requirements.

The first is rooftop solar.

While rooftop panels might seem like an expensive investment initially, there are some clear long-term financial benefits. Displaying them on your roof also says something valuable about you and your contribution to sustainable living.

Rooftop solar is also taking action at a macro level. It is driving us toward a distributed power model, which is completely different to the model we have today. For the first time in history, individuals have the power to decide where they get their power. This consumer-driven trend has sparked a movement not unlike the rise of the smartphone.

Consider, for example, the plot in Figure 5, which shows the drop in the price of solar PVs against the combined power being generated by solar from 2010 to 2014. The trend added 4.5 GW of power to the grid, while the price of that energy dropped by almost 500% over the 4 years. That’s the equivalent of adding about 8 large-scale power plants to the grid, the bulk of which would have been completed in 3 years or less.

Figure 5 – Cumulative global solar photovoltaic deployment and solar photovoltaic module prices 2000 to 2014

It’s probably no surprise that batteries, or power storage, is the second disrupter. Storage allows us to take advantage of the sun during the day, storing excess power for when there is less sun.

Batteries like solar PV’s are also on a disruptive price curve, meaning that the year on year price decline is making them noticably cheaper every day.

So that is great for consumers living in suburbia with plenty roof space and sunlight, but how does it help apartment-dwellers whose only option is to buy power from the grid?

Peer-to-peer trading is the third important disrupter. This essentially cuts out the retailer and allows individuals to trade directly with each other. To make peer-to-peer trading a reality we need to bring together smart grids and network-based trading. The smart grid conversation is well underway, and some companies are starting to look at leveraging blockchain technology to allow peer-to-peer trading.

Peer-to-peer trading would allow city dwellers to partake in the digital energy revolution by buying excess power from the cheapest provider on the grid. What is interesting here is that the longer peer-to-peer trading takes to implement, the more pressure there will be on large power facilities when it does happen. As more users make the jump to rooftop solar (potentially going off the grid), fewer people remain on the grid to pay for the infrastructure. With demand dropping, costs are likely to go up, further fuelling the move to rooftop solar.

This ultimately means more and more solar PVs, which will likely lead to a huge energy glut in the market. When peer-to-peer trading eventually does kick in, large power facilities will need to compete with plenty cheap home- grown solar. (We see a similar phenomenon with AirBnB, where hotels are now competing with individuals who have a much lower cost base).

Electricity generation contributes only about 70% of CO2 emissions, so it’s not the only major contributor to the carbon footprint. The second-largest contributor to CO2 emissions is the transportation sector. With a potential electricity glut driven by the abundance of solar power, storage, and peer-to-peer trading, it follows naturally that electric cars will soon become much cheaper to run than their carbon-consuming alternatives.

This will likely happen more quickly in urban environments, with long-range travel taking a little longer. In fact, we are already seeing similar rapid price declines in the transportation sector, where the cost of electric cars is dropping and the variety of options is increasing dramatically. Electric cars also don’t face the challenge of a network to supply “electric fuel,” unlike competitors such as hydrogen-powered cars.

The final dimension to consider is how all this plays out in third-world countries. Today non-OECD countries, which predominantly represent the poorer countries, account for about 60% of global emissions.

At the rate at which solar and battery prices are dropping, it won’t be long before we see a massive jump in the uptake of individualised power generation in emerging countries. A decentralised power model will leapfrog the traditional grid model, reducing not only the cost of power but also the time required to provide power in remote places from years to literally days. We saw a similar trend when cellular phones emerged, with networks and adoption proliferating even in high-poverty areas.

In conclusion, it is my opinion that unless governments and lawmakers support rapid reduction of CO2 emissions by getting behind energy disruption, supporting a decentralised solar model, and adopting new laws that facilitate peer-to-peer trading and accelerate smart grid technology, we will fail as a society to stop global warming. Unfortunately, I don’t see sustaining technologies like nuclear, wind, and large-scale solar as sufficient, because they don’t make the leap from sustaining incremental improvement to disruptive change.

A decentralised power model supported by power storage and peer-to-peer trading, all linked via a smart grid, will enable the economic drivers necessary to change how we generate and buy power. There is nothing like a financial incentive to ultimately unite consumers toward the common cause of reducing the threat of climate change.

Companies like SAP are helping their customers not only transform their business models to adapt to this massive energy change but also to optimise and save energy at the same time. For more information, click here. To learn more about what SAP is doing with blockchain technologies, click here.

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Anton Kroger

About Anton Kroger

Anton Kroger is an Energy and Natural Resources industry solution specialist for SAP based in Australia. Anton has worked in the resources sector for 16 years and has field operations and management experience, both locally in Australia and internationally. He now works with Energy and Natural resources companies across Australia and New Zealand to help them run better, more innovatively and imagine new ways of doing business. He is an advocate for clean energy and resources and believes that innovation is critical to the future of this industry. Anton believes that despite the disruption taking place in the industry today there is still a lot of opportunity for existing companies in the future.

The Internet Of Things: An Environmentalist’s Heaven Or Hell?

John Graham

Back in early December, The Guardian ran an article asking whether the Internet of Things will save or sacrifice the environment. As you’d expect, the answer is far from clear. Some environmentalists worry about the effects of producing, installing, and powering those billions of extra devices; others urge the use of IoT sensor networks to help us monitor and curb resource consumption and emissions.

On the surface, the thought of creating huge wireless sensor networks for the benefit of the environment seems paradoxical. However, there is a much bigger picture lurking underneath. The Global e-Sustainability Initiative’s (GeSI) recent #SMARTer2030 report suggests that IoT-related technologies could save “almost 10 times the carbon dioxide emissions that it generates by 2030 through reduced travel, smart buildings, and greater efficiencies in manufacturing and agriculture.”

Even if we achieve a situation in which physical IoT devices have a net positive effect on humanity’s carbon footprint, there is still the massive data transmission and storage growth to consider. Speaking as an executive of a company providing the cloud-based data platform for IoT networks, I can say that it’s in our best interests to keep energy consumption as low as possible, because it costs less. That’s why data centers are built with energy efficiency top of mind.

Ultimately, whether or not the IoT turns out to be an environmentalist’s dream will depend on how we apply its concepts. If it’s primarily used to stream endless high-quality video feeds 24 hours a day or for power-hungry gimmicks and trivialities, the footprint will be far worse than if it’s used directly to get resource and energy management under control. It seems unlikely that the private sector and consumers alone will summon the collective motivation to veer in the direction of the latter, so policy will need to keep up and be sound and assertive.

The attitude of disposability in Western society today is another issue altogether. Perfectly functional year-old smartphones and computers are piling up in landfills across the globe as consumers struggle to resist the lure of the latest model. Can the IoT buck this trend by being founded on sensor networks built to last? With the world trending away from centralized hardware and toward cloud-based software, it could be that upgrades to the virtual aspects of IoT will be enough to satisfy our lust for innovation, while the sensors hum away out of sight and out of mind.

Time will tell.

Register here to listen to an SAP Live webcast in which IBM’s IoT guru Michael Martin discusses the possibilities and challenges of our connected future.

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John Graham

About John Graham

John Graham is president of SAP Canada. Driving growth across SAP’s industry-leading cloud, mobile, and database solutions, he is helping more than 9,500 Canadian customers in 25 industries become best-run businesses.

Climate Change: Look North and South – The Evidence Is Real

Nancy Langmeyer

Explorer Sir Robert Swan – the first and only man to walk on both the North and South Poles unsupported – believes that “the greatest threat to our planet is the belief that someone else will save it.”

As a self-proclaimed survivor, Sir Swan, like many others around the globe, believes that climate change and global warming are very serious issues.

The United Nations (UN) adopted 17 Sustainable Development Goals (SDGs) in 2015, and Goal 13 asks the world to “take urgent action to combat climate change and its impacts.” According to the UN, “Climate change is now affecting every country on every continent. It is disrupting national economies and affecting lives, costing people, communities, and countries dearly today and even more tomorrow.”

The National Aeronautics and Space Administration (NASA) says the rate of temperature increase around the globe has nearly doubled in the last 50 years due to greenhouse gases released as people burn fossil fuels. But even though 2016 was the hottest year in recent history, sadly there are still people in the world who say global warming is of no concern and that it is actually a “hoax!”

Well, like Sir Swan, let’s look to the North and Sole Poles and see what we can learn about the reality of this situation.

The Poles have a story to tell us…

Sir Swan believes the North and South Poles hold vital clues to the issue of global warming and that they are an indication of what is going on around the world in respect to climate change.

In his TED talk, Swan showed pictures of melting ice in the North and South Poles, describing it as a dangerous situation. He says, “We need to listen to what these places tell us, and if we don’t, we’ll end up with our own survival situation here on planet Earth.”

So, let’s start in the North and find out what we can learn there.

At 90⁰ north latitude, the North Pole is 450 miles north of Greenland, in the middle of the Arctic Ocean. There is no actual landmass at the North Pole – only massive amounts of ice that expand in winters and shrink down to half the size in summers.

The climate change story here is that the North Pole has been experiencing unusually high temperatures, reaching 32⁰ Fahrenheit in December 2016, which was 50⁰ warmer than typical! This trend has lead to an alarming shrinkage of the Arctic Sea ice masses that equates to approximately 1.07 million km² of ice loss every decade.

Why is this a problem? Well, according to the National Science Foundation, sea ice variability – the amount of water the ice puts into or pulls out of the ocean and the atmosphere – plays a significant role in climate change. NASA says that, “The sea ice cover of the Arctic Ocean and surrounding seas helps regulate the planet’s temperature, influences the circulation of the atmosphere and ocean, and impacts Arctic communities and ecosystems.”

Even the coldest place on Earth is getting warmer!

Now, in the completely opposite direction, what can we learn from the South Pole and Antarctica? At 90⁰ south latitude, Antarctica, which includes approximately 90% of the ice on the planet, is a little over 300 feet above sea level with an ice sheet on it that is about 9,000 feet thick.

Much colder than the North Pole, the temperature here has dropped to a chilling low of -135.8⁰ Fahrenheit in 2013. However, this pole, too, is experiencing warmer weather, with its highest temperature reaching 63.5⁰ in March 2015.

NASA indicates that Antarctica has been losing about 134 gigatonnes of ice per year since 2002. And just recently, a new concern emerged – a rift in the continent that could send a significant part of the polar cap off into the ocean and create one of the largest icebergs ever recorded. This could, in the long run, raise global sea levels by four inches.

So what’s a little rise in sea level?

While a couple inches here or there doesn’t seem like much, NASA says rising sea levels can erode coasts and cause more coastal flooding, and in fact, some island nations could actually disappear.

And that’s just the sea level. There are other ramifications as the climate changes, such as an increase in infectious diseases with the expansion of tropical temperature zones, more intense rain storms and hurricanes, and many other life-threatening issues.

Let’s be the “someone else”

These insights are just the tip of the iceberg (so to speak) in the story of global warming, but it is evident the Poles are telling us that climate change is real. It’s also evident that it’s time for us as the inhabitants of this world to become the “someone else” Sir Swan talks about. And the good news is that it’s not too late for us to save this planet.

We don’t have to go to the North or South Pole to make an impact. We can simply follow Swan’s advice: “A survivor sees a problem and doesn’t go, ‘Whatever.’ A survivor sees a problem and deals with that problem before it becomes a threat.”

Whether it’s at work with a company like SAP that supports the UN SDGs with its vision and purpose, or individually – we all have to help climate change before there are irreversible threats to our place. Let’s be the someone else, starting today.

A quick note: My last blog focused on how women in the arts and sports are helping to break gender inequality barriers. Well, I am happy to report that this same movement is happening in science too! In 2016, an initial 76 women in science embarked on a leadership journey to increase the awareness of climate science. The inaugural session of the year-long Homeward Bound program, which focused on empowering women in science, culminated in December 2016 with the largest female expedition in Antarctica. Here these brilliant, dedicated female scientists and engineers saw the effects of climate change first-hand and brainstormed how they, through “collaborative leadership, diverse thinking, and creative approaches,” could make an impact. 

SAP’s vision is to help the world run better and improve people’s lives. This is our enduring cause; our higher purpose. Learn more about how we work to achieve our vision and purpose.

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Nancy Langmeyer

About Nancy Langmeyer

Nancy Langmeyer is a freelance writer and marketing consultant. She works with some of the largest technology companies in the world and is a frequent blogger. You'll see some under her name...and then there are others that you won't see. These are ones where Nancy interviews marketing executives and leaders and turns their insights into thought leadership pieces..

How Emotionally Aware Computing Can Bring Happiness to Your Organization

Christopher Koch


Do you feel me?

Just as once-novel voice recognition technology is now a ubiquitous part of human–machine relationships, so too could mood recognition technology (aka “affective computing”) soon pervade digital interactions.

Through the application of machine learning, Big Data inputs, image recognition, sensors, and in some cases robotics, artificially intelligent systems hunt for affective clues: widened eyes, quickened speech, and crossed arms, as well as heart rate or skin changes.




Emotions are big business

The global affective computing market is estimated to grow from just over US$9.3 billion a year in 2015 to more than $42.5 billion by 2020.

Source: “Affective Computing Market 2015 – Technology, Software, Hardware, Vertical, & Regional Forecasts to 2020 for the $42 Billion Industry” (Research and Markets, 2015)

Customer experience is the sweet spot

Forrester found that emotion was the number-one factor in determining customer loyalty in 17 out of the 18 industries it surveyed – far more important than the ease or effectiveness of customers’ interactions with a company.


Source: “You Can’t Afford to Overlook Your Customers’ Emotional Experience” (Forrester, 2015)


Humana gets an emotional clue

Source: “Artificial Intelligence Helps Humana Avoid Call Center Meltdowns” (The Wall Street Journal, October 27, 2016)

Insurer Humana uses artificial intelligence software that can detect conversational cues to guide call-center workers through difficult customer calls. The system recognizes that a steady rise in the pitch of a customer’s voice or instances of agent and customer talking over one another are causes for concern.

The system has led to hard results: Humana says it has seen an 28% improvement in customer satisfaction, a 63% improvement in agent engagement, and a 6% improvement in first-contact resolution.


Spread happiness across the organization

Source: “Happiness and Productivity” (University of Warwick, February 10, 2014)

Employers could monitor employee moods to make organizational adjustments that increase productivity, effectiveness, and satisfaction. Happy employees are around 12% more productive.




Walking on emotional eggshells

Whether customers and employees will be comfortable having their emotions logged and broadcast by companies is an open question. Customers may find some uses of affective computing creepy or, worse, predatory. Be sure to get their permission.


Other limiting factors

The availability of the data required to infer a person’s emotional state is still limited. Further, it can be difficult to capture all the physical cues that may be relevant to an interaction, such as facial expression, tone of voice, or posture.



Get a head start


Discover the data

Companies should determine what inferences about mental states they want the system to make and how accurately those inferences can be made using the inputs available.


Work with IT

Involve IT and engineering groups to figure out the challenges of integrating with existing systems for collecting, assimilating, and analyzing large volumes of emotional data.


Consider the complexity

Some emotions may be more difficult to discern or respond to. Context is also key. An emotionally aware machine would need to respond differently to frustration in a user in an educational setting than to frustration in a user in a vehicle.

 


 

download arrowTo learn more about how affective computing can help your organization, read the feature story Empathy: The Killer App for Artificial Intelligence.


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Christopher Koch

About Christopher Koch

Christopher Koch is the Editorial Director of the SAP Center for Business Insight. He is an experienced publishing professional, researcher, editor, and writer in business, technology, and B2B marketing. Share your thoughts with Chris on Twitter @Ckochster.

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In An Agile Environment, Revenue Models Are Flexible Too

Todd Wasserman

In 2012, Dollar Shave Club burst on the scene with a cheeky viral video that won praise for its creativity and marketing acumen. Less heralded at the time was the startup’s pricing model, which swapped traditional retail for subscriptions.

For as low as $1 a month (for five two-bladed cartridges), consumers got a package in the mail that saved them a trip to the pharmacy or grocery store. Dollar Shave Club received the ultimate vindication for the idea in 2016 when Unilever purchased the company for $1 billion.

As that example shows, new technology creates the possibility for new pricing models that can disrupt existing industries. The same phenomenon has occurred in software, in which the cloud and Web-based interfaces have ushered in Software as a Service (SaaS), which charges users on a monthly basis, like a utility, instead of the typical purchase-and-later-upgrade model.

Pricing, in other words, is a variable that can be used to disrupt industries. Other options include usage-based pricing and freemium.

Products as services, services as products

There are basically two ways that businesses can use pricing to disrupt the status quo: Turn products into services and turn services into products. Dollar Shave Club and SaaS are two examples of turning products into services.

Others include Amazon’s Dash, a bare-bones Internet of Things device that lets consumers reorder items ranging from Campbell’s Soup to Play-Doh. Another example is Rent the Runway, which rents high-end fashion items for a weekend rather than selling the items. Trunk Club offers a twist on this by sending items picked out by a stylist to users every month. Users pay for what they want and send back the rest.

The other option is productizing a service. Restaurant franchising is based on this model. While the restaurant offers food service to consumers, for entrepreneurs the franchise offers guidance and brand equity that can be condensed into a product format. For instance, a global HR firm called Littler has productized its offerings with Littler CaseSmart-Charges, which is designed for in-house attorneys and features software, project management tools, and access to flextime attorneys.

As that example shows, technology offers opportunities to try new revenue models. Another example is APIs, which have become a large source of revenue for companies. The monetization of APIs is often viewed as a side business that encompasses a wholly different pricing model that’s often engineered to create huge user bases with volume discounts.

Not a new idea

Though technology has opened up new vistas for businesses seeking alternate pricing models, Rajkumar Venkatesan, a marketing professor at University of Virginia’s Darden School of Business, points out that this isn’t necessarily a new idea. For instance, King Gillette made his fortune in the early part of the 20th Century by realizing that a cheap shaving device would pave the way for a recurring revenue stream via replacement razor blades.

“The new variation was the Keurig,” said Venkatesan, referring to the coffee machine that relies on replaceable cartridges. “It has started becoming more prevalent in the last 10 years, but the fundamental model has been there.” For businesses, this can be an attractive model not only for the recurring revenue but also for the ability to cross-sell new goods to existing customers, Venkatesan said.

Another benefit to a subscription model is that it can also supply first-party data that companies can use to better understand and market to their customers. Some believe that Dollar Shave Club’s close relationship with its young male user base was one reason for Unilever’s purchase, for instance. In such a cut-throat market, such relationships can fetch a high price.

To learn more about how you can monetize disruption, watch this video overview of the new SAP Hybris Revenue Cloud.

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