"Efficiency is the greenest form of energy you can think of." ABB's Joe Hogan on the enormous potential for industry to make energy go farther through efficiency gains.It's more simple for ABB these days, now that it's finding synergy with recent acquisition Baldor, whose motors are coming together nicely with ABB's drives. "Motors use 40% of the energy in industry," Hogan said. "If you put low-voltage drives on every motor, you would save $40 billion."
Data centers were a key talking point for Hogan, who pointed to that market for incredible potential energy savings. Data centers use 100 times more power than a similar-sized office building, he said, which in itself makes the potential huge. Added to that is the exponential growth in data-driven processes. "Every time someone develops a new app, you have to build a data center somewhere," Santacana said.
"Data centers are critical for modern economies," Hogan said. "You'll see so much innovation from data centers in the next 10 years."
Part of that innovation is likely to come in the form of dc power, which will be a "great disruptor," Hogan said. In data centers, for example, energy efficiency could be improved 10% to 20% over an ac system. Utilities have used dc power distribution for a long time, but the concept is relatively new to data centers, Santacana explained later at a media briefing. In practice, using dc power would call for fewer rectification steps, leading to fewer losses and better efficiency, he said.
The planet used almost 18 trillion kWh of electricity last year. Although the world is standardized on ac power, it's time to take advantage of dc's ability in many areas to improve power efficiency, Hogan said.
ABB doesn't advocate that dc take over everything, Hogan explained, but there are places where it makes sense. "The need for dc power is on the rise," he said. "We need to take advantage of every kilowatt of power—ac and dc."
Finding and exploiting such disruptive technologies is part of ABB's growth strategy, Hogan said. Another part of the strategy is looking for megatrends, he added, such as within the smart grid, power electronics, mechanical equipment, and oil and gas. "We want to be in areas where the market's growing," he said. "We look for markets where the wind is blowing."
One of the markets that ABB is putting more emphasis on is the United States, which remains by far the largest economy, still about double that of China. "By far the most momentum we see in the world right now is occurring in the United States," he said.
Listing the $100 million of investments made so far by ABB Technology Ventures, Hogan noted that six of the eight companies have been from the U.S. "It shows you just how innovative this country still is."
The days of "labor arbitrage," in which companies run to China to take advantage of lower labor costs, are coming to an end, Hogan argued. Companies are organizing instead around geographies, enabling faster response times for customers and more localized products and solutions.
