Technical Article

Industrial Energy Systems (IES): Rising Technologies in Manufacturing

December 30, 2021 by Gunner Scott

Power plays a vital role in manufacturing. But, what are industrial energy systems (IES) and recent trends impacting the industry?

Industry consumes a large portion of energy in the United States every year, accounting for 33% of total U.S. energy usage in 2020. This article dives into the novel energy technologies being developed, which can open pathways for an energy-efficient, low-carbon, and net-energy productive manufacturing industry.


Industrial Energy Systems (IES)

Like other sectors of the economy, industry uses a combination of energy sources, including natural gas, petroleum, electricity, renewables, and coal, as seen in figure 1. While most factories purchase their energy from either utility companies or independent power producers, some use a combination of purchased power and on-site power generation. This uses both renewable and nonrenewable sources to produce heat for industrial processing, space heating in buildings, electricity generation, steam, and hot water. 


U.S. industrial sector energy use by source 1950-2020

Figure 1. Distribution of energy sources used by the U.S. industrial sector. Image used courtesy of U.S. Energy Information Administration (EIA)


Industries allocate their power usage toward operating industrial machinery, lights, general office equipment, servers, data centers, and facility heating, cooling, and ventilation. 

Industry can be further broken down into four main industrial sectors to further understand how energy is used. 

  • Manufacturing (~77% share of industrial energy usage): The mechanical or chemical transformation of materials into new products. 
  • Mining (~12% share of industrial energy usage): The extraction of non-mineral and mineral products from the earth. 
  • Construction (~7% share of industrial energy usage): Building and fabricating commercial, residential, and public infrastructure.
  • Agriculture (~5% share of industrial energy usage): Farming, fishing, and forestry.


coal mine

Figure 2. A coal mine. Coal is often used in industrial manufacturing for energy.


As seen from the U.S. EIA, manufacturing takes the lion's share of energy use in industry, creating a large energy expense for the companies, while also levying a large environmental impact. New government legislation, technologies, and more efficient manufacturing techniques are leading the industry into three trending categories. 

  • Decarbonization: The transition to carbon-free renewable energy. Increasing the electrification of industrial systems will result in less reliance on nonrenewable sources and increase the efficacy of renewable sources. 
  • Decentralization: Distributing power to many multi-level producers and consumers fosters adaptive energy systems that can easily incorporate renewable energy, and reduce the energy intensity requirements of large centralized industries.
  • Digitation: Implementation of intelligent energy by widespread digitalization of machines and devices. 

New innovative technologies and startups are focusing on making these trends a reality. 


Innovative Energy Industry Trends 

Internet of Energy

The Internet of Energy, a spinoff from the Internet of Things (IoT), is pushing to upgrade the automating of our current electrical infrastructure for producers and industrial consumers. Inefficiencies in our infrastructure cause energy waste and are direct areas to target for startups. 

  • 75 Fahrenheit: A smart building solutions company that focuses on providing control of commercial and industrial buildings to the user by connecting heating and cooling devices to IoT to optimize how HVAC equipment is powered.

Energy Storage

Renewable energy technologies have proficient energy generation, but more often than not, lack cost-effective energy storage solutions. Properly storing energy allows for stable energy pricing and companies to create and store their energy or even sell it back to the grid. 


electrical grid power station

Figure 3. An electrical grid power station.


  • Energy Vault: A Swiss energy company developing technology to provide around-the-clock baseload power from non-consistent sources, like wind and solar, by incorporating gravity and water pump-storage plants, providing long-duration energy storage.
  • STORE-H Energy Storage Technologies: An Italian startup developing a hydrogen-on-demand system that creates hydrogen from renewable sources, which can be stored and burned to produce energy on demand. 


Blockchain technology is not just for cryptocurrencies. Industry can adopt it to unite stakeholders within one decentralized energy network. Blockchain can be combined with IoT (internet of things) devices that allow the manufacturing industry to directly purchase energy from the grid rather than a centralized retailer. 

  • Grid+: A blockchain company that has identified centralized retailers as the source of inefficiency in the industrial market and plans to directly link consumers to the grid, where companies can manage their purchasing and management of their energy usage. 

Energy-as-a-Service (EaaS)

Energy-as-a-Service (EaaS) is a natural evolution of the energy market as the Internet of Energy, energy storage, and blockchain energy expands and advances. It creates a business model where consumers can access energy management services without upfront costs. This means industrial sectors can quickly and adaptively gain access to and transition between various energy systems and sources. 

  • Dcbel (formerly Ossiaco): Vehicles-to-grid technology frees electric vehicles (EVs) to charge or discharge their battery storage based on nearby energy consumption. Essentially, the EVs would provide transportation but also act as energy storage that can be bought and sold in a dynamic pricing system with real-time information exchange. 
  • FSIGHT: Behind-the-meter technology that creates a platform for users to bypass the need for metering self-produced energy, promoting the use of on-site renewable sources of electrical production. Factories could directly offset their metering with any electricity they produce, balancing the existing power grid.  

As the manufacturing industry grows and evolves with novel designs and products, so will the energy infrastructure that powers them. This article does not provide an exhaustive list of new technologies and general energy trends around the world. Still, it provides a glimpse into the expansion and acceleration of the energy industry and how it will directly affect the way we power sector in the United States.