Digital transformation and artificial intelligence (AI) are reshaping how energy systems are managed and operated across the globe. According to a new report from the International Renewable Energy Agency (IRENA), Digitalisation and AI for Power Systems Transformation: Perspectives for the G7, the adoption of digital technologies has the potential to cut costs, enhance reliability and strengthen power systems—particularly as countries accelerate their transition to renewable energy.
Published at the request of the Canadian G7 Presidency during the G7 Energy and Environment Ministers’ Meeting in Toronto, the report examines how digitalisation and AI-driven applications can support the clean energy transition. The analysis highlights the significant opportunities offered by digital tools such as forecasting, automated grid operations, and real-time monitoring in improving energy security, boosting system performance, and enabling the integration of low-cost renewables.
Enabling smarter, more efficient power systems
The IRENA report identifies five key value clusters where digitalisation can create measurable benefits: monitoring, forecasting, operational optimisation, end-use automation, and transparency. Together, these areas form the foundation for smarter, more efficient power systems that can balance fluctuating energy supply and demand while maintaining system stability.
In particular, digital technologies are seen as essential for supporting the expansion of renewable energy sources such as solar and wind, whose variability demands greater flexibility and real-time responsiveness from electricity grids. By embedding AI-driven forecasting tools, for instance, operators can anticipate generation patterns and adjust supply accordingly, reducing energy costs for consumers and enhancing overall grid reliability.
The report also notes that digitalisation offers particular advantages for emerging and developing economies (EMDEs), where investment in modernised grids and digital infrastructure can drive significant socioeconomic gains. Enhanced data systems, interoperable networks, and workforce development in digital skills are identified as key enablers of this transition.
Policy recommendations for the energy transition
IRENA’s analysis outlines several recommendations for G7 policymakers and industry leaders to maximise the benefits of digitalisation in power systems. These include conducting benefit-oriented assessments to guide investment, strengthening data systems with a focus on cybersecurity, and addressing the digital skills gap to ensure that the energy workforce is prepared for new technologies.
The report also calls for closer cooperation between the energy, digital and public sectors to coordinate energy planning and mobilise investment, particularly in developing regions. By aligning regulatory frameworks, financial incentives, and workforce training, governments can create the right conditions for digital innovation and equitable technology adoption.
Building resilient, affordable and secure power systems
Commenting on the report, Francesco La Camera, Director-General of IRENA, noted that the world is on track to achieve record levels of renewable power deployment in 2025, an important step toward tripling renewables by 2030. However, he emphasised that “reliability, affordability and security must be the backbone of the digital transition.”
Canada’s Minister of Energy and Natural Resources, Tim Hodgson, echoed this view, stating that empowering the energy sector through digital solutions is vital to ensure security, responsibility and competitiveness.
As electricity’s share of final energy consumption is projected to reach 52% by 2050, digitalisation will play an essential role in managing this scale of growth. Embedding digital solutions by design, alongside physical infrastructure and long-term energy planning, will enable more resilient, efficient and cost-effective power systems worldwide.
For the digital construction and energy sectors, this transformation underscores a broader shift: digital innovation is no longer optional but fundamental to building the connected, intelligent infrastructure of the future.
Read next: Advancing physical AI for dexterous robotics – Build in Digital
Are you a building professional? Sign up for a FREE MEMBERSHIP to upload news stories, post job vacancies, and connect with colleagues on our secure social feed.
