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Transforming the Energy Industry with IoT

Over the last few years, researchers and industry professionals have increasingly focused on integrating and optimizing renewable energy (Hossein Motlagh et al., 2020). A number of smart technologies have become increasingly relevant in the energy sector, including the Internet of Things (IoT). As a new technology, the Internet of Things (IoT) makes physical devices capable of connecting to one another via the Internet (Hossein Motlagh et al., 2020). As a result of its versatility, it can be used for a variety of applications, including improving energy efficiency, increasing the share of renewable energy, and reducing the environmental impacts associated with energy use (Hossein Motlagh et al., 2020). This article examines how the IoT can be used in the energy industry, including on the regulatory and supply side of the industry.

In the regulation side of the energy sector, it can be used for energy democratization. The IoT and Blockchain technologies make it possible to enable peer-to-peer electricity trading for more small end users (Tushar et al., 2020). IoT is used to create a platform for energy trading and money transactions based on blockchain technology (Baig et al., 2020). In this concept, energy trading is enabled locally and incentives are given in the form of crypto currency (Baig et al., 2020). Energy transactions are conducted through blockchain technology, whereas energy consumption is monitored by IoT devices (Baig et al., 2020). Prosumers are able to participate in the energy market proactively by purchasing or selling excess energy through an online peer-to-peer (P2P) trading platform (Baig et al., 2020). Through this application, hierarchy in the energy supply chain is decentralized, market power is dispersed, and the energy market is liquified, resulting in lower energy prices for prosumers (Hossein Motlagh et al., 2020). As data will be monitored and utilized in real-time, it also helps to heighten awareness about energy usage and efficiency (Hossein Motlagh et al., 2020).

IoT can also be used for implementing preventative measures in the energy industry (Hossein Motlagh et al., 2020). Typically, it is used in the upstream oil and gas industry. An analysis of big data collected from static or mobile sensors or cameras within large factories prevents leakage, faults, and human errors caused by fatigue  (Hossein Motlagh et al., 2020). The data collected can be analyzed for patterns, allowing for preventative maintenance to be performed or warning of possible leaks in the piping system to be made  (Hossein Motlagh et al., 2020). In this case, the IoT is extremely beneficial because it minimizes the risk of failure, reduces production and maintenance downtime, and reduces operations and maintenance costs (Hossein Motlagh et al., 2020). The IoT also helps to reduce accidents and increases safety (Hossein Motlagh et al., 2020).

IoT can also be used to maintain faults in the energy supply side of the industry  (Hossein Motlagh et al., 2020). The technology is also used in the upstream oil and gas industry. By collecting data on the performance and health of the system, it identifies functional anomalies before they occur (Peter et al., 2022). Through its analysis, it is capable of detecting and possibly resolving energy network failures and problems rapidly online (Hossein Motlagh et al., 2020). It significantly improves the speed at which leakage or failure in electricity grids can be repaired, as well as the reliability of the service (Hossein Motlagh et al., 2020). Moreover, it improves the health and safety of the workers as well as reducing maintenance time (Peter et al., 2022). 


In the energy industry, IoT has great potential, as evidenced by its numerous applications. While most of the technology is at its very beginning stages, there is hope that it will be implemented soon on a large scale. In the meantime, consumers will continuously seek out less expensive energy alternatives.


Baig, M. J., Iqbal, M. T., Jamil, M., & Khan, J. (2020). IOT and blockchain based peer to Peer Energy Trading Pilot Platform. 2020 11th IEEE Annual Information Technology, Electronics and Mobile Communication Conference (IEMCON).

Hossein Motlagh, N., Mohammadrezaei, M., Hunt, J., & Zakeri, B. (2020). Internet of Things (IOT) and the Energy Sector. Energies, 13(2), 494.

Peter, G., Stonier, A. A., Gupta, P., Gavilanes, D., Vergara, M. M., & Lung sin, J. (2022). Smart Fault Monitoring and normalizing of a power distribution system using IOT. Energies, 15(21), 8206.

Tushar, W., Saha, T. K., Yuen, C., Smith, D., & Poor, H. V. (2020). Peer-to-peer trading in Electricity Networks: An overview. IEEE Transactions on Smart Grid, 11(4), 3185–3200. 


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