1. Future energy demand technologies: the information age Smart energy systems Cliff Elwell MRes residential week 2011 29 th September 2011

2. Overview Review the incumbent energy system and demographics Smart meters, smart grids and smart energy System operation Consumers, data and communications Summary

3. 4 pillars of energy policy Energy policy Economics (affordability) Security of supply Environment Social policy objectives

4. Source: DECC UK end-use energy consumption trends by sector (1970-2009)

5. Source: BERR, 2008 Number of UK households with appliances

6. The UK energy system: appliances Appliances are a small but significant contribution to UK energy demand Source: BERR, 2008

7. Energy consumption in the UK Other final uses are primarily agriculture, public administration and commerce Source: DECC, 2010 Excludes transport and agriculture Source: DECC, 2010

8. UK demographics Population forecast:  62 million now  77 million 2050 Ageing population  Energy use?

9. 75% of growth is accounted for by population growth Source: Department for Communities and Local Government, 2009 Projection of the number of households in the UK Households increase 21M of today’s homes will still exist in 2050 20 housing archetypes comprise 60% of the housing stock

10. (DECC, 2010) Fuel poverty in the UK: a reminder

11. What is the energy system? Note down: Examples of stakeholders What is its function? What are the boundaries of the system?

12. What is the energy system? Stakeholders Generators, transmission network operator, distribution network operator, supplier, equipment suppliers, maintenance crews, consumers, builders, building services engineers… Too many to list! Functions The primary function of the energy system is to meet the needs of customers. What are the boundaries of the system? A definition may serve as a conceptual tool but energy cannot be separated from any function of modern society.

13. The GB energy system: electricity demand Typical GB Electricity Demand Profiles (Winter & Summer Days) (Data source: National Grid)

14. High variability in gas demand System operation challenges if heat pumps are run like boilers GB gas demand (National Grid) Local gas demand: 65 houses Gas demand in GB

15. UK energy system – electricity No vertical integration! Supply Large number of companiesNo vertical integration Distribution Natural monopoly14 UK regions; 8 companies Transmission Natural monopolyNational Grid Generation UK mostly large scaleRange of companies

16. The future energy system

17. The UK energy system: balancing Increase in inflexible plant Balancing may be expensive  Magnitude of load changes  Low utilisation  Non-optimal operation of CCS Source: DECC; pathway alpha

18. The UK energy system: security of supply Electricity system reliability  Highly interconnected  Outages rare Average <1 hr per year per customer Average <1 interruption per year per customer  But system designed for gas heating and non-electrified transport  And ageing infrastructure  And decreasing capacity margin Energy gap? Data source: Electricity Networks Association

19. Source: ENA How long are the networks?

20. The UK energy system: heat Heat was 45% of energy end use consumption in 2008 Ageing building stock: poor insulation Transition of heating type: –Gas  Electricity Peak demand? –Reinforcement –Peaking generation Trials to validate future scenarios

21. The UK energy system: transport Electrification of transport –But availability of imported biofuels critical –Battery costs, performance, longevity etc Locally high uptakes of EVs and PHEVs may occur sooner than UK trend Source: DfT, 2008

22. The UK energy system: electricity demand Estimated national averaged load profile (winter peak) for full penetration of heat pumps and electric vehicles (Strbac, 2010)

23. Technical functional requirements of the energy system Interoperability Future proof Support the electrification of heat and transport Enable high penetrations of distributed generation to connect Increase system efficiency Maintain or improve security of supply Facilitate high penetrations of inflexible generation plant Facilitate end user participation

24. Smart energy systems

25. Is smart energy part of the solution?

26. The smart energy system Definition Intelligently integrates the actions of all supply and demand side users Efficient delivery of sustainable, economic and secure energy Monitoring and control to enhance system performance May integrate multiple energy vectors to effectively deliver services to customers Alternative smart concepts Components: Smart meter Smart grid Broader: Smart city Smart community

27. Information and control in the smart grid World Economic Forum, 2009

28. What aspects of a smart grid can be defined? 1 Broad technical functionality: system requirements Consumer outcomes Core, mandated, components and specifications –Smart meters –Data Communications Company etc But A cost-benefit case must be met for non-mandated components –Competing smart, and dumb, technologies –Physical definition is not possible –Is value-chain definition possible? Despite this Models of potential end states structure thinking, provide the basis for discussion and are necessary for the development of smart grids 1 Assuming a market with regulated consumer and environmental outcomes, but minimal vertical integration or central policy to define the components of a smart grid.

29. System operation

30. Source: Dyrelund, 2009 Heat Plan Denmark: an illustration of fuel flexibility in district heating systems

31. Storage “Real”: Virtual (demand side management DSM):

32. System operation… How would you operate the system under: -“Normal” conditions -High wind, low demand scenario -Low wind, high demand scenario … back to slide 30

33. Example system management “Normal” operation High wind, low demand Less Charge Low wind, high demand Less Dis- charge

34. Complementary functions  Demand management  Storage  Fuel shifting How do we heat?  Heat pumps  Boilers  CHP  District  High penetrations of low carbon technologies Shift operation with no loss of service:  Heating  Appliance operation  Charging Availability? Required tariffs? Service offerings?

35. Consumers

36. Consumer requirements Lighting Appliances Space heating and cooling Water heating Cooking Transport Industrial processes

37. Consumers and smart energy Consumer participation in the markets Behavioural change – An increasing realisation that behavioural change doesn’t necessarily mean consumers changing day-to-day habits – purchases and use of control systems. Privacy and security of data? – A spy in your fridge?

38. Costs, benefits and business

39. (Mott MacDonald, 2007) Costs and benefits of smart meters to UK suppliers

40. Distribution network reinforcement costs in Coventry. HV: high voltage; LV: low voltage; BaU: business as usual (Strbac, 2010)

41. Business models Interlinked business models a major challenge for smart systems –Little evidence for coherence from any stakeholders –Focus on “own world” –Increased acceptance that regulation and frameworks are required –Investment and reward are not currently aligned appropriately to attract investment

42. Data, communications and high-tech solutions

43. Data services and communications Data services –Critically dependent upon regulation and consumer acceptance –The potential and value of data services is often underestimated New offerings Targeted marketing Core enabler of functionality –New entrants and many in academia/industry: potential huge impact Communications –Battle of the systems/protocols

44. System monitoring, diagnostics and optimisation – Appliances Working Fault/problems – Industrial processes Networks – Component stress Temperature Performance – Automatic network optimisation – Fault finding and isolation Consumers – Heating, cooling and ventilation Heat pump operation Air conditioning Water heating System diagnostics and optimisation

45. Energy management systems Respond to price signals  Real time TOU tariffs  Programmable  Participation in the market User friendly  Simple interface  Override  Customisable  Remote control Learning  Storage potential Electrical Thermal  Usage profile Effect?  Energy use  Service provision  User acceptance

46. Wrapping up

47. Smart systems could increase or decrease CO 2 Source of CO 2 reductionSmart system role Reduced use of high CO 2 peaking plant  Demand management and storage Timely connection of low CO 2 distributed generation  System monitoring and control (e.g. dynamic line ratings) Reduction in energy use  Energy management and behavioural change Installation of appropriate energy saving measures in property  High quality consumer specific data System optimisation  Monitoring and controlling devices remotely or automatically Voltage optimisation  Advanced monitoring and control Low carbon generation  Demand management and storage to provide economic system management

48. Smart energy system Network management: Advanced dynamic load and storage control Business TOU tariffs New services Proven cost- effective Storage Generation Appliances and other loads Heat: dynamic Diagnostics and control MEET FUNCTIONAL REQUIREMENTS: CONSUMERS’, ENVIRONMENT, COSTS AND TECHNICAL

49. Smart energy systems in the UK: summary Electrification of heat and transport will create system challenges Increase in number of households 80% reduction in CO 2 from 1990 levels required by 2050 Meeting consumers’ requirements is key  Can new products create consumer-pull to low carbon technologies and system management strategies? Smart energy systems may:  Support system operation  Enhance customer experience  Lower CO 2 emissions... But they might not be the most cost effective solution

50. Smart grid definition: Electricity Networks Strategy Group A Smart Grid … can intelligently integrate the actions of all users connected to it - generators, consumers … to efficiently deliver sustainable, economic and secure electricity supplies. A Smart Grid employs communications, innovative products and services together with intelligent monitoring and control technologies to: – Facilitate connection and operation of generators of all sizes and technologies – Enable the demand side to play a part in optimising the operation of the system – Extend system balancing into distribution and the home – Significantly reduce the environmental impact of the total electricity supply system – Provide consumers with greater information and choice of supply Deliver required levels of reliability, flexibility, quality and security of supply

51. Storage and DSM may support system operation Energy delivery vector Storage mediumSpeed of response Duration of response Cost Black start Key services Balancing Peak shift Heat ElectricityBatteries   ££££ Pumped H 2 O  +   ££££ Thermal energyThermal fabric   £ Hot water   £ System inertia   - Heat accumulators   £££ Seasonal storage  +    £££? Electricity and heat Fuel (CHP + boilers)  +    ££ Demand management N/A   ££