Painel 5 - UK's Smart Grids Policy Landscape and Reflections for Brazil

UK’s Smart Grids policy landscapeand reflections for Brazil

João Lampreia Manager, Carbon Trust Brazil

2

1. Introduction to the Carbon Trust and this project

• Summary of our work

• Our Smart Grid experience

• Introduction to the SG project with FCO Brazil

2. RESULTS: Main insights brought by the UK’s Smart Grids experience

3. Reflections for Brazil

Agenda

ADVICE

Business AdviceHelping businesses capture the opportunities in a sustainable low carbon world

Government AdviceProviding cutting-edge policy advice and insights on the transformation of markets

Public Sector AdviceEnabling the public sector to cut costs and emissions

FOOTPRINTING

MeasuringUnderstanding the environmental impact of an organisation, product or service

CertifyingProviding independent verification of organisational or product footprints to endorse sustainable leadership

TECHNOLOGY

Implementation and FinanceProviding expertise and support to businesses to put energy efficiency plans into action

Innovation Partnering with companies and governments seeking to create value from the clean technology revolution

We help our clients benefit from the opportunities of sustainable, green growth

4







Agenda

We have delivered 14 projects to date in Brazil, such as:

›Time of use electricity pricing assessment

›Electricity system resilience assessment for Rio Olympics

›Energy efficiency leadership by the public sector›Impact assessment manual and training course for energy policy appraisal

›Distributed energy policy

›Best practice in energy efficiency finance

›UK best practice for low carbon technology innovation strategy

›Building performance labelling

ORGANISATION PROJECT TOPIC

›Designing a Product Footprinting and Certification Scheme

6

We have worked extensively with Smart Grids and smart meters in the UK:

Informed the UK Government’s

decision to roll-out of advanced meters

1- We ran the UK’s first large scale smart meter trial in 2011

Demand responseMineral heat storageSmart meter innovators

Trial of half-hourly metering in

580 smaller businesses

Average savings identified of

£1,000/year per site

Potential annual cost saving of

£300 millionbut poor business case

for DNOs to invest

2- We incubated and/or invested in several innovative SG companies

7

We have worked extensively with Smart Grids and smart meters in the UK:

Informed the Government’s expenditure of a

£1.3 billion budget along 4 years

3- We helped the government prioritize areas for innovationDefined 10 national innovation priority areas including Energy Networks and Storage

• 8 Govt. Departments• 4 Innovation organisations• Ofgem• Science Research Council

4- We were selected to assess the impact of the Low Carbon Networks Fund

5- We assessed the potential for innovative business models for smart meters

8

We have worked extensively with Smart Grids and smart meters in the UK

6- We have carried out a large joint industry project on storage

7- We are analysing best options to enhance flexibility in the UK grid

• Roadmap for sector development• UK system needs and business case • Strategic policy recommendations• Energy storage could save £2.4 billion/year system wide by 2030 • If regulatory hurdles are overcome this could rise to £7 billion/year

• Systems modelling

• Optimal level of flexibility across range of energy futures (DSR, Storage, CCGT and Interconnectors)

• Policy recommendations

https://www.carbontrust.com/resources/reports/technology/energy-storage-report/



9







Agenda

10

We are currently concluding a project on Smart Grids for 4 Brazilian organisations

Objective: Synthesise insights from the UK’s experience of Smart Grids to support smart grid policy, regulation and technology development in Brazil.

FinancierImplementers

Contract-based grant

Beneficiaries:

11






• Strategic level: A roadmap for smart grids - what did the UK want to reach?

• Policy level: Policy & regulation to make the strategy become a reality

• Ground level: Practical barriers and ground solutions


Agenda

12










Agenda

13

Smart grids consist of a collection of technologies which enable greater control and flexibility of the electricity system…

Smart chargers (e.g. for EVs)

Smart appliances

Home Energy Management Systems (HEMS)

Consumer access devices (CAD)

Distributed Generators (e.g. rooftop PV)

Smart invertors (+ other back-flow tech)

Small storage (e.g. cells)

Advanced/ smart metering

Demand side Network

Advanced distribution (HDVC cabling, converters, platforms, capacitors)

Supply side

Advanced transmission (cabling, converters, platforms, capacitors)

Active Network Infrastructure (Virtual power plants, IT controllers, aggregators)

Centralized Generators (e.g. Hydro plant)

Large storage (e.g. compressed air storage)

Battery management systems

Storage

Network storage (e.g. lithium-ion batteries)

Smart grid development has applications across the entire value chain…

15

The long term drivers for smarter grids in the UK are:

Carbon reduction

Energy security Affordability

While immediate drivers and challenges on the ground are:

Traditional grid

› Centralised generation

› Inflexible demand

› Uni-directional power flows

› Reactive decision making

› Passive networks

16

Electrification of heat

Electrification of transport

Greater DG connections

Increase in intermittent gen

Smarter grid

› Distributed generation

› Flexible demand

› Dual power flows

› Real time decision making

› Active networks

Energy gets cheaper

Energy-related emissions decrease

Grid becomes more flexible and resilient

New business models give rise

to new opportunities

RESULTS:TRENDS:

17

There is a growing evidence base to show that Smart Grids will bring benefits

“Deploying storage could deliver cost savings of up to £7 billion in 2030” –

(Carbon Trust, DECC, Ofgem, 2016)

“Interconnection, Storage, and Demand Flexibility could save consumers up to £8 billion a year by 2030” –

(National Infrastructure Commission, 2015)


https://www.gov.uk/government/news/a-smart-power-revolution-could-save-consumers-8-billion-a-year-adonis





To overcome the challenges and reap the benefits, the UK has developed a strategic roadmap in 2014 to support smart grids…

18

Carbon reduction

Energy security Affordability

Lack of regulatory & commercial arrangements

Lack of coordination and engagement

Lack of technology and supply chain development

Overarching drivers

Challenges for Smart Grids

Roadmap

Develop clear regulatory frameworks and

commercial support

Foster engagement between all key stakeholders

Support technology innovation and develop

strong supply chain

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/285417/Smart_Grid_Vision_and_RoutemapFINAL.pdf



19

With significant progress made in the last two years in all strategic roadmap areas

› RIIO evolution › Cash out reforms › Capacity market – DSR

and storage› Smart meters and HH

settlement› New products from

National Grid (EFR, STOR-R)

› Smart Grid Forum › Energy Innovation Centre

– Open Innovation

› Consumer flexibility › Network automation› LV network monitoring› Storage › Support for big data in

networks › Smart meters› Demand side flexibility › Flexible DG connections

Develop clear regulatory frameworks and

commercial support

Foster engagement between all key stakeholders

Support technology innovation and develop

strong supply chain

UK Smart Grid Forum is a successful model of driving strategic smart grid development

20

PURPOSE & AIMS:• Overcome coordination issues (14 DNO members)• Bring stakeholders together (Gov + industry + others)• Support transformative action for Smart Grids

uksmartgrid.org

http://uksmartgrid.org/

UK Smart Grid Forum is a successful model of driving strategic smart grid development

21

ORGANISATIONAL STRUCTURE: Chair:

Shared by DECC/Ofgem

Core members:Small group representing all

stakeholder groups

Work stream 1

Work stream n

Work stream 8

Flexible structure, members chosen for specific skills

~20 core members, chosen by open letter for individual expertise &

influence across value chain

First two work streams funded by DECC, to show value to DNOs.

Currently funded by DNOs

• WS 1: Assumptions and scenarios• WS 2: Evaluation framework• WS 3: Developing networks for low carbon• WS 4: Closing doors (smart meters)

• WS 5: Ways of working• WS 6: Commercial and regulatory issues• WS 7: Whole system design• WS 8: Vision and Routemap

22










Agenda

Price control regulations have evolved to enable greater support for SG technologies…

23

RPI-X DPCR 5RIIO

Revenue = Incentives+ Innovation + Outputs

› Deliver services as cheap as you can

› Establishment of £500m Low Carbon Network Fund (LCNF)

› Establishment of Network Innovation Competitions (NIC)

› Revenue earned from investing in technologies that reduce the cost to consumers

2008 2015

24

and a suite of connected policies have been introduced to encourage innovation and deployment

Smart Grid innovation

policies

Low Carbon Network Fund

(LCNF)Network

Innovation Competition

(NIC)

Network Innovation Allowances

(NIA)

Energy Entrepreneurs

fund

EPSRC / TSB - Localised

Energy System Projects

EPSRC – Low-carbon

Vehicle ResearchProjects

DECC – Energy Storage Demonstration Competition

25

+ - -

+ - -

DIST

RIBU

TION

NET

WOR

K 6MW/10MWh li Ion battery connected to distribution network First UK large-scale battery trial to demonstrate technical and

commercial implications to the network Peak shaving to defer network reinforcement, ancillary services

(operating reserve, frequency response, TRIAD avoidance) Key in driving policy and regulatory change to enable unlocking

system benefits of storage to enable deployment and commercial viability

Lead acid batteries installed across households having rooftop PVs integrated with energy management systems and able to receive signal from network

Energy bill reduction enabled by Time of Use (ToU) together with battery storage and PV to shift usage more effectively

Powering lighting and USB appliances directly through installed battery/PV (DC circuits) proved a valuable resource of consumers

Distributed batteries offers opportunities to defer network assets reinforcementCO

NSUM

PTIO

N EN

D

Source - UKPN, Poyry, WPD

Example of policy results: innovation policies have already supported successful smart grid trials

26

High voltage direct current

(convertors, offshore substations)

Information and Communication Technologies(virtual power plant, cyber

security, big data)

CATAPULTS LCNFENTREPRENEURS

FUNDINNOVATIVE UK COMPETITIONS NIC/NIA

POLICIES

STRENGTH AREAS

COMPANIES

Example of policy results: innovation policies have already supported the global development of UK firms

27










Agenda

28

However there are many practical challenges for deploying smart grids successfully…

FIT for DG example

• Policies are effective (but hard to predicted)

• Result on the ground level is the creation of new challenges for continued DG uptake

THIS CAN’T KEEP GOING UP THIS QUICKLY BECAUSE THE NETWORK CANNOT ACCOMMODATE IT!

The UK has made significant progress in solving a number of practical barriers to DG uptake

29

1. High volumes of connection applications

2. Inadequate customer services

3. Approaching network capacity limits

4. Poor network visibility

5. Disproportionate reinforcement costs

6. DG installation financing costs

7. Lack of incentives to innovate

8. Incomplete policy coordination

9. Safety and quality concerns

Barriers SolutionsPre-application

filtering Queue management

Forum to connect DNOs/customers

Incentives for engagement in RIIO

Flexible connection offers

Smart grid technologies

Smart-registers

National charging review

Finance schemes

LCNF NIC/NIA

Low carbon strategy

Microgeneration certification scheme

30







7. Lack of incentives to innovate connecting









Smart-registers


Finance schemes

LCNF NIC/NIA

Low carbon strategy


• Increased public information (e.g. online maps of grid availability used to reduce impractical applications)

• Study to make queue system transparent and stakeholder workshop on new queue options

• Smart Grid Forum to bring together DNOs and connect them with customers

• Explicit incentives in RIIO price controls for DNOs to improve customer engagement


31
















Smart-registers


Finance schemes

LCNF NIC/NIA

Low carbon strategy


• Novel commercial arrangements offered for customers in constrained network areas = interruptible/flexible offers

• Active Network Management technologies installed to control flexible offer systems

• LCNF flexible connection project demonstrated 37% increase in customers accepting offers (over 50MW extra)


32
















Smart-registers


Finance schemes

LCNF NIC/NIA

Low carbon strategy


• Feed-in-tariff projections not well coordinated with real network limits / not well discussed with DNOs

• New framework in price control (RIIO-ED1) to coordinate better between policy and networks in the future (e.g. government & DNOs estimate DG growth rates together)


33

The UK is also looking at challenges for the future of DG connections

Active Network Management

solutions to control this whole system

in real time

International standardisation to open borders for

technologies

Increased DG penetration

affecting transmission

network

34










Agenda

35

UK’s experience thus far in smart grids offers many interesting insights across policy, regulation and technology for Brazil

1

2

3

4

Drive innovative culture Cost effective innovation incentive programs such as LCNF have been successful in strengthening broad “innovation” culture across the network incumbents beyond just technology

Creating the right incentives Incentives in the price control mechanisms for DNOs to continuously improve on their DG connection process means they can earn from deploying innovative solutions

Cross industry leadership Smart grid forum is a critical entity bringing together the government and industry and addressing challenges for policy & regulatory planning and technology deployment

Integrated design Smart grids extend across energy policy, regulatory design, infrastructure development and climate change policy, therefore it requires consideration beyond network design and planning

Whilst reasonable steps have been taken to ensure that the information contained within this publication is correct, the authors, the Carbon Trust, its agents, contractors and sub-contractors give no warranty and make no representation as to its accuracy and accept no liability for any errors or omissions. All trademarks, service marks and logos in this publication, and copyright in it, are the property of the Carbon Trust (or its licensors). Nothing in this publication shall be construed as granting any licence or right to use or reproduce any of the trademarks, services marks, logos, copyright or any proprietary information in any way without the Carbon Trust’s prior written permission. The Carbon Trust enforces infringements of its intellectual property rights to the full extent permitted by law.The Carbon Trust is a company limited by guarantee and registered in England and Wales under company number 4190230 with its registered office at 4th Floor Dorset House, Stamford Street, London SE1 9NT.Published in the UK: 2014.© The Carbon Trust 2014. All rights reserved.

Thank you for your attention!

João LampreiaManager, Carbon Trust [email protected]

mailto:[email protected]

mailto:[email protected]

Date post:	14-Apr-2017
Category:	Government & Nonprofit
Upload:	ukinbrazilnetwork
View:	109 times
Download:	1 times

Painel 5 - UK's Smart Grids Policy Landscape and Reflections for Brazil

Government & Nonprofit