As China challenges the U.S. in AI, Big Data And Machine Learning are reshaping the energy industry

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The Artificial Intelligence (AI) revolution is catching up to the energy sector | oilandgasmiddleeast.com

Machine learning, Big Data, and automation are revolutionizing global industry – and the energy sector is no exception. Innovation is driving technological progress, boosting economic efficiency, creating smarter business operations, and leading to more resilient infrastructure. It’s why businesses and governments around the world are making advanced technology – including artificial intelligence – a top economic and national security priority.

Energy companies are implementation big data and AI in versatile ways – and the sector is growing. The market for AI software in the oil and gas industry is expected to reach a whopping $2.85 billion by 2022.  Predictive analytics can monitor miles and miles of underground pipelines, while machine-learning can help fossil fuel companies drill more effectively at a lower cost through better understanding the geological structures far below the earth’s surface. New ‘smart’ electric grids are employing machine learning technology to integrate computers, automation, and sensors in order to respond instantaneously – and even predictively – to rapid changes in energy demand.

Brutal Competition

In February this year, President Donald J. Trump issued an executive order designed to maintain America’s dominance in the field of artificial intelligence technology. The so-called American AI Initiative focuses on boosting federal spending and resources across industry, academia, and other non-Federal entities to generate technological breakthroughs in AI.

 In May, Energy Secretary Rick Perry announced the Department of Energy (DOE) was partnering with Cray and AMD to build Frontier, consisting of three new machines that will enhance America’s AI capabilities. Frontier is said to be the world’s fastest computer, roughly 50 times faster than current supercomputers.

China has also jumped into the AI game early – and by some metrics is ahead of the United States.

In 2017, the Chinese government released “A New Generation Artificial Intelligence Development Plan” outlining concrete R&D funding and goals to advance The People’s Republic as a global leader in AI by 2030 adding an estimated $150 billion to its economy. While the United States dominates China in most AI related metrics, the PRC is ahead in startup equity funding and data collection. Furthermore, China is home to 17 of the top 20 universities for AI research.

The US-Chin AI tech race is heating up | Bloomberg/Oxford University

AI reshaping the energy sector

Applications of Artifical Intelligence in the energy sector are proliferating.  XTO Energy Inc, an Exxon Mobile (NYSE: XOM) subsidiary, has partneredwith Microsoft to use machine learning, intelligent business applications and cloud technology to collect data from its 1.6 million acres of oil fields. The real-time data would improve drilling and monitor infrastructure conditions for leaks and repairs. This partnership makes it the largest oil and gas acreage to use cloud technology. The implementation of Microsoft technologies will help boost production growth in the Permian as much as 50,000 barrels per day by 2025.

AI can also help make energy infrastructure safer. Pacific Gas and Electric Co. (NYSE: PCG) has turned to machine-learning to combat wildfires in California that have been exacerbated by the changing climate: some of which they have been accused of starting themselves (see their multi-billion dollar damage lawsuit). The California electric utility company uses drones to inspect its transmission towers, with the images then converted to data points by AI – currently there are more than 1 billion data points. The data is then put into an algorithm that determines where PG&E should focus its resources in order to reduce the risk of potential wildfires.

Offshore workers are seen in the master control room aboard the Chevron Corp. Jack/St. Malo deepwater oil platform in the Gulf of Mexico off the coast of Louisiana, U.S., on Friday, May 18, 2018. The combination of new technology, big data, and smarter design will end much of the overspending that’s made large troves of subsea oil barely profitable to produce, industry executives say | Photographer: Luke Sharrett/Bloomberg

Smart energy systems will increasingly allow customers to rely on renewable energy sources to power their homes and businesses. Renewables are inherently intermittent, as they depend on solar radiation, cloud cover, wind, and waves. Modern technology can help utility companies redirect the flow of sometimes erratic energy through the smart grid – the smarter the better. And as storage capabilities grow, companies will be more adroit in directing excess electrons to utility-scale batteries – be them lithium ion or hydrogen fuel cells.

While AI has tremendous benefits to our economy, there are huge risks. Computers and machines are only as good as their programming – designed by humans – meaning they are still imperfect.  Digitization and enhanced interconnectivity increases vulnerability to manipulation and sabotage. Relying more on Big Data and machine learning exposes users to cybersecurity risks – something the electric grid and utility companies are already addressing, ironically, sometimes with artificial intelligence.

Governments and regulators must create proper policy mechanisms to address these concerns and risks associated with the expanded use of technology. Recently, the United States met with country members of the Organization of Economic Cooperation and Development (OECD) to determine principles and guidelines for the use of artificial intelligence internationally. This is an important step toward responsible AI implementation.

As the AI tech war heats up, business and consumers alike will benefit from increasingly safer, cleaner, cheaper, and more efficient energy. Let the war rage on.

Forbes

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