Innovation What’s Holding Ireland Back? September 2013

2 esb.ie How does Ireland Rate in 2013? Innovation ●10 th of 142 profiled economies. ●7 th in terms of European economies ●Notes Germany is classified as 15 th and 10 th respectively ●Ireland has the local dynamics to foster innovation: –Strong high-tech knowledge-based sector –Centres of Research Excellence –Track record of FDI by multinationals –Continued SME spin-off ●Position has fallen from 9 th in 2012

3 esb.ie Ireland’s Innovation – Strengths & Weaknesses Innovation ●Institutions – 8th ●Human Capital & Research – 9th ●Market Sophistication – 8th ●Business Sophistication – 6 th ●Knowledge & Technology outputs – 4th –Switzerland – 1 st –China – 2 nd –Israel – 3rd Strengths ●Creative Outputs – 26 th ●Infrastructure – 37 th –ICT – 41 st  ICT Access  ICT Use  Government eServices  Citizen eParticipation –General Infrastructure – 68 th  Infrastructure construction Weaknesses ESB’s Innovation will help Ireland’s cause

4 esb.ie Bloomberg Global Innovation Index Innovation ●Ireland is ranked 12 th in Bloomberg’s Global Innovation Index –R&D Intensity – 21 st –Productivity – 8 th –High tech Density – 19 th –Researcher Concentration – 21 st –Manufacturing Capability – 7th –Tertiary efficiency – 9th –Patent Activity – 32 nd ●Other rankings of note: –United Kingdom – 18 th –Germany – 3 rd –South Korea - 2 nd –United States – 1 st

5 esb.ie Internet / Broadband Availability & Performance Innovation ●Akamai Technologies report Q –Average broadband speeds ●1 st – South Korea – 15 Mbps ●7 th – Switzerland – 8.7 Mbps ●15 th – Ireland – 6.6 Mbps

6 esb.ie Other observations from ESB Innovation Competition / 3 rd Level Silos ●ESB’s interactions with 3 rd Level Institutes show: –Significant similarities in innovation programmes –Duplication (from industry perspective) ●Recent positive steps –SEES Cluster –IERC model –SFI Hub & Spoke model –Strategy for re-organisation / consolidation of Institutes of Technology Further co-operation is necessary

7 esb.ie How can ESB’s innovation help? Innovation ●Next Generation Broadband rollout ●Emerging Renewable Generation ●ESB’s Demonstration initiatives –Smart Green Circuits –North Atlantic Green Zone –EV Charging Infrastructure –FINESCE Project

8 esb.ie FTTB – Delivering Next Generation Broadband Innovation DAE

9 esb.ie High Voltage stations ESB Fibre NetworkMedium Voltage electrical network Connected MAN Non Connected MAN (2,000km Fibre) Electrical equivalent to Homes Passed Next Generation Broadband - Reach

10 esb.ie Pre-commercial project First wave energy farm in Ireland Pave the way for commercialisation through:  delivering 5MW small-scale array at acceptable cost  demonstrating technology readiness  developing the supply-chain and  developing public acceptance NER300 funding

11 esb.ie WestWave Progress Technical Dialogue Wave Measurements underway Environmental Scoping Reports Published Seabed Surveys Complete Grid Offers in place

12 esb.ie Self Healing Networks Network – Automation Innovative Protection and Fault Diagnostics Dynamic Sectionalising Voltage Conservation Reduction Low Loss Transformers 20kV Conversion No Voltage Grading No Voltage F M T Feeder Recloser Midpoint Recloser Tie Recloser No Operator Intervention! Loop Automation Timers F M M2 M1 F T M M2 Potential benefits: Reduce customer interruptions by 40% Reduce customer minutes lost by 70% Significant reduction in losses Smart Green Circuits

13 esb.ie North Atlantic Green Zone A proposed Project of Common Interest between Ireland and Northern Ireland 1.Implement the newly trialled technologies (previous slide) on a blanket basis 2.Increase network efficiency and deliver energy reductions of over 3% 3.Improving the security of supply – reducing customer interruptions by 54% 4.Assisting to Reduce wind curtailment from a potential 25% to 8% 5.Pave the way for follow-on Demand Response initiatives This PCI will position Ireland favourably for further innovation in Smart Grids.

14 esb.ie Electric Vehicles – Infrastructure National trial 95% of major towns and cities already covered Fast Chargers on interurban routes Charge point types Home (3.6kW) Public AC (22kW) Fast/Rapid/Quick (43-50kW) Installations already completed Public charge points 44 fast chargers installed Domestic / commercial EV Charging Infrastructure

15 esb.ie Innovation Future Internet Smart Utility Services (FINESCE)

16 esb.ie Innovation What can Ireland do in each of these areas?

17 esb.ie Innovation In Summary ●Ireland positioned reasonably well in terms of global innovation metrics ●One area where we can improve is in ICT Infrastructure / Broadband connectivity and access ●ESB firmly believes that further cooperation between the 3 rd Level Institutions and between 3 rd Level and Industry can boost innovation ●ESB’s Innovation focus will support Ireland’s and Europe’s cause: –Next Generation Broadband –Emerging energy technology demonstration –Large scale demonstrations - Test Bed for Innovation ●ESB looks forward to continuing to play a significant role in energy innovation and in the area of ICT convergence with operational energy technologies. ●Through our innovation, we can help deliver Eurelectric’s Innovation Action Plan.