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Some turbulent years: economy
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2008 2009 2009 2010
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Some turbulent years: energy and climate change
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2008 2009 2009 2010
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Three key issues
Energy Security
Economic Growth Climate Change
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Drivers of the new energy era
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Consumers
Policy Technology
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Level of concern with energy-related issues% Extremely + Somewhat concerned
Consumers are concerned
Source: Accenture The New Energy World: The Consumer Perspective
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What actions should be considered the top priority in order to reduce your country’s reliance on fossil-fueled power?
Developing low -carbon sources of energy is the top priority
37%Use less energy
63%Develop low-carbon sources of energy
Use less energy
Source: Accenture The New Energy World: The Consumer Perspective
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National policies and investments are in place
• EU 20-20-20• EU ETS
• Canada ecoENERGY Efficiency Initiative
• South Korea ETS
• Bio-fuel program
• EU ETS
• Japan Top Runner Program
• Tokyo ETS
• US RGGI• US Western Climate Initiative• US EPA• US CLEAR Act• US Kerry-Graham-Lieberman bill
• China Sustainable Energy Program
• Tianjin Climate Exchange
• Carbon Pollution Reduction Scheme (CPRS)
• Mexico ETS
Korea ETS
Under consideration
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Technology is there
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Things will go faster than we think
MaturityBasic R&D Pilots Diffusion
Mass deployment
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Time10
•Serve their customers with greater relevance
•Influence policy in a more holistic way
What should Energy and Utility companies do?
•Influence policy in a more holistic way
•Drive technology at scale
Serve customers with greater relevance
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Influence policy with a holistic view
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Drive technology at scale
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There is increasing global recognition of the pivotal role of smart
grids in transitioning to a low-carbon economy
South Korea – KEPCO to pilot beginning in 2010
Japan – Kyushu Electric
Canada – varies by province
Ontario: set to fully deploy by end of 2010
British Columbia: set to fully deploy by 2012
Quebec: shelved plans
U.S. - varies by state
See details
See details
Russia – implementing smart meters
There are an estimated 90 smart grid pilots around the world today
1515Copyright © 2009 Accenture All Rights Reserved.
Japan – Kyushu Electric Power & Okinawa Electric Power to
beginning in late 2009
Utility pilots initiated
No activity
Announced plans/evaluating
Smart Grids/ smart meters in process of being deployed
Accenture project
Australia – Ministerial Council for Energy has agreed to install smart meters in 4
states. Roll out in Victoria to be complete by 2013.
South Africa – proposed regulations - by 2010, all
commercial and residential have smart meters
China – possible stimulus package for smart grid to be
run by State Grid
New Zealand – implementing smart grid
Mexico – 22M meters deployed by CFE
Pilots in:
• Brazil
• Colombia
• Ecuador
• Nicaragua
See details
European Snapshot of the Pace of Adoption of Smart Grid
U.K. – All homes to install by 2020
Norway – waiting for Swedish conclusions on technology before
creating its own specificationa
Netherlands –Amsterdam Smart City
Sweden – implementing smart meters
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34
56 15
313233
343536 37
3839
4041
43
424445 46
474849
Finland – implementing smart meters
Denmark – implementing smart grid / meters
Germany– implementing smart meters
Austria– implementing smart meters
Ireland – implementing smart meters
16Copyright © 2009 Accenture All Rights Reserved.
Accenture project
Utility pilots initiated
No activity
Announced plans/evaluating
Smart Grids/ smart meters in process of being deployed
Smart Grid/AMI
AMR
Implementation Activity
1 567
8
9
10
11 121314
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2425
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Italy – ENEL pioneered European deployments in 2001 when announced it’s intention to replace all 27
million electric meters
Current and future mandates/requirements are expected to accelerate deployment of smart technologies, however they are not required.
NJ: 22.5% by 2021
CT: 10% by 2010
MA: 4% by 2009 + 1% annual incr
MN: 25% by 2025;(Xcel: 30% by 2020)
CA: 20% by 2010
ME: 30% by 2000;10% by 2017 goal -new RE
RI: 15% by 2020
NY: 24% by 2013
MT: 15% by 2015
IA: 105 MW
WA: 15% by 2020NH: 25% by 2025
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1 2
6
23
24
7 8
5051
16
21
444546
47
4849
43
17
585960
616263
VT: RE meets load growth by 2012
WI: requirement varies by utility; 10% by 2015 Goal
1819
205253
54
5556
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State Goal (non-mandated)
PA: 18% by 2020
NJ: 22.5% by 2021
TX: 5,880 MW by 2015
NM: 10% by 2011
AZ: 15% by 2025
NV: 20% by 2015
State RPS
MD: 7.5% by 2019
HI: 20% by 2020
CO: 10% by 2015
DC: 11% by 2022
DE: 10% by 2019
IL: 8% by 2013
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3
4
25
2627
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30
31
3334
35
36
329
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11
12
22
37
38
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41 1340
42
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57
Smart Grid/AMI
AMR
Implementation Activity
Accenture project
Australian Smart Grid / Smart Metering SummarySmart metering and smart grid have become pervasive in the Australian market, against a backdrop of record capital programs and a drive towards sustainability
WA –Electricity AMI / Smart Grid Pilots / strategy
• Most T&D utilities now have a smart metering and/or smart grid agenda – including the gas and water utilities
− Victoria – AMI focussed, large transformational programs in place driven by regulatory mandate to implement AMI for all customers (2.4 million)
− Other states – Wider smart grid view, strategy & pilot projects in progress, driven by emphasis on network reliability and carbon reduction (pilots range from 50 to 20,000 customers)
QLD – ElectrictyAMI / Smart Grid trials & strategy, 20K customer AMR trial for water
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reduction (pilots range from 50 to 20,000 customers)
• In general, the impetus is coming from the Electricity Distribution companies, who are seeking improvements in network reliability, and deferral of network capacity upgrades.
• With the exception of Synergy, Electricity retailers are mostly taking a passive, compliance-based approach to smart metering, due to lack of perceived benefits in the mandated distributor-led model.
• In general, Water and Gas utilities are just starting to undertake smart metering trials, seeking to “piggy back” off electricity trials to achieve cost synergies and overcome communications technology issues with non-electric utilities.
• Federal and State Governments are encouraging this “piggy back” model to reduce their costs in funding smart metering / smart grid programs, which is creating a sense of urgency in Water and Gas utilities to get on board before it is too late.
TAS –Electricity AMI / Smart Grid trials & strategy
NSW –Electricity AMI / Smart Grid trials & strategy, small AMI pilots for electricity & water
SA – Electricity AMI / Smart Grid trials, Water trials for irrigation users
VIC – Electricity Smart Metering mandated for all customers. Small trials of water & gas
For today’s pilots to effectively lead to the scale up of smart grids, a
number of challenges need to be overcome
• The struggle to create strong smart grid business cases in environments where regulatory
incentives have not evolved to reflect today’s policy agenda
• The uncertainty of future legislation
• Challenges around data privacy, cyber-security, interoperability and standards
• Conflation of objectives, whereby new technologies and pricing structures are rolled out in
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2
3
4
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• Conflation of objectives, whereby new technologies and pricing structures are rolled out in
parallel
• Consumer engagement challenges, both in communicating effectively with the consumer and
in delivering high-quality implementations
• Difficulty in convincing regulators and customers of the true benefits
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5
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• Pilots should be used as a
mechanism to improve regulatory
incentives
• Pilots needs to be carefully
How do we position Smart Grid pilots for success?
•
• Pilots needs to be carefully
planned and scoped to ensure
objectives are met
• Pilots need to develop greater
consumer insight and systematically
engage with consumers
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logo, and High Performance Delivered are trademarks of
Accenture.
These pilots will evolve with time from a pure technology focus, to
an operating model focus and finally to a business model focus
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Short-term
‘Lay the foundations for
success’
Medium-term
‘Reshape the agenda
and roll-out proven
technologies’
Long-term
‘Change the model’
� POLICY MAKERS Encourage
Smart Grids will transition to the mainstream
with the right support
Time
� POLICY MAKERS
Create the right
conditions for
investment
� INDUSTRY
Focus on creating a
stable technology
platform
� POLICY MAKERS
Align incentives to
encourage
investment
� INDUSTRY
Utilise pilot data to
influence policy
� POLICY MAKERS Encourage
new market entrants
� INDUSTRY
Position the value case for
full roll-out of technologies
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Key findings of new WEF report
Political and Regulatory Context• The right regulatory and policy framework for innovation and investment• Drive for global standards
Scoping Phase• Be clear about the test parameters and understand when customers will be engaged
• Clarity and ambition in design• Grid vs consumer pilots’ capability
• Collaborate to develop commercial capability that trials new operating and business models• Successful commercial collaboration
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• Successful commercial collaboration• Experiment with new operating and business models
• Develop consumer insight• Segment consumers by behavior• Target business customers
Executions• Engage and educate consumers• Re-engineer in the field
Dissemination of the Lessons Learned• Share lessons from the field• Inform the regulatory/policy environment
Generating Insight through Pilot Scoping and Execut ion Phases
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We all must play our role in moving to a smarter,more sustainable future
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Consumers
Governments Technology companiesIndustry
Business Community