From Forecasting to Grid Automation: Digital and AI Technologies Poised to Reshape Power Systems, Says IRENA

Digital technologies and artificial intelligence (AI) are rapidly transforming global power systems and accelerating the energy transition, according to a new report released by the International Renewable Energy Agency (IRENA). The report, titled Digitalisation and AI for Power Systems Transformation: Perspectives for the G7, was launched during the G7 Energy and Environment Ministers’ Meeting held from 30–31 October in Toronto, Canada, at the request of the Canadian G7 Presidency.

The report highlights that digitalisation and AI-based applications are reducing electricity costs, improving energy security, enhancing business performance, and supporting the integration of low-cost renewable energy sources. It identifies five key value areas where AI and digital solutions can generate impact: monitoring, forecasting, operational optimisation, end-use automation, and transparency.

IRENA emphasises that these tools can unlock opportunities not only in advanced economies but also in emerging and developing economies (EMDEs), particularly where modern grid infrastructure and strategic investments are implemented. The study underscores the role of digitalised power systems in expanding energy access, supporting socioeconomic growth, and enabling resilient energy transitions.

Key Recommendations for G7 Governments

The report advises G7 policymakers to:

• Conduct benefits-focused assessments of power systems to guide investment and policy decisions.
• Strengthen data infrastructure and interoperability with emphasis on regional coordination and cybersecurity.
• Address the digital skills gap to prepare the workforce for the evolving energy landscape.
• Enhance energy planning to attract public and private investment, particularly in EMDEs.
• Foster collaboration between the energy, digital, and public sectors to accelerate power system transformation.

Driving the Transition to Resilient Digital Power Systems

IRENA Director-General Francesco La Camera noted that the world is on track to break renewable energy installation records in 2024, marking a strong step toward tripling renewables by 2030.

“With electricity expected to power more than half of global energy use by 2050, reliability, affordability, and security must underpin digital transformation,” La Camera said. “The G7 can lead by scaling digital solutions that boost efficiency and resilience while cutting costs.”

Canadian Minister of Energy and Natural Resources Tim Hodgson highlighted the importance of digital tools in strengthening national energy systems. “Empowering Canada’s energy sector to harness digital solutions is vital to make it more secure, responsible, and competitive,” he said.

Digitalisation Embedded in Future Energy Systems

The report calls for digital solutions to be integrated into power systems from the design stage, alongside physical infrastructure and long-term planning. It stresses that AI will be essential in managing electricity demand and supply as global electrification increases, with electricity projected to account for 52% of final energy consumption by 2050.

As renewable energy capacity grows and distributed energy resources expand, digital technologies will be critical to maintaining system reliability without undermining the cost advantages of renewables.

IRENA reaffirmed its commitment to supporting G7 nations and its global membership in building affordable, secure, and digitally advanced power systems.