We need integrated resilient smart grids that can accommodate the rapid growth of intermittent renewables as well as the rise of “prosumers” who both buy and sell electricity into the grid. This is the focus of three online discussion sessions on February 8th, 9th and 10th organised and hosted by power management company Eaton. The proliferation of multiple generation sources (solar, wind, batteries and other clean, flexible technologies) means centralised power supply is being replaced by distributed energy systems. That will need coordination between energy suppliers, distributors, investors, innovators, consumers and all the related sectors involved (buildings, transport, etc.) Europe is expected to make annual grid investments of over €60bn between 2021 and 2030. Though disruption is inevitable, it should come with the creation of hundreds and thousands of quality and local jobs delivering the new solutions. Sara Stefanini summarises the challenges and opportunities, the role of big tech and the utilities, and flags up the urgent need for new policy frameworks to support this transition. [Article promoted by Eaton]
A rapid transition to clean, flexible electric energy systems – away from fossil fuel-powered centralised systems – will determine the world’s ability to reach net zero emissions before 2050 and meet the Paris climate agreement’s goals.
The necessary technology already exists, such as solar and wind power, electric vehicles, batteries and building efficiency measures. But to transform at the speed and scale required, it will need to be built on a foundation of integrated resilient smart grids that can accommodate the intermittency of renewable energy sources and the rise of bi-directional power flows and “prosumers” who both buy and sell electricity into the grid.
The economic and societal benefits of rolling out smart grids and clean energy technology could be significant – creating jobs, helping to transition sectors and workers away from fossil fuel reliance and accelerating the wider economy’s decarbonisation.
But it requires a clear-cut and long-term policy framework that incentivises the necessary planning and investment across the energy sector. It requires coordination between the energy suppliers, energy distributors, investors, technology developers, consumer groups and others involved. And it needs to start taking hold now, because the window for reaching net zero emissions before 2050 is quickly narrowing.
To get there, global electricity generation needs to reach net zero emissions by 2040, while energy consumption needs to be “well on its way” to a 50% reduction compared to now, according to the International Energy Agency’s roadmap for net zero by 2050. This requires a massive deployment of clean energy technologies and electricity system flexibility, including renewables, electric vehicles, batteries and demand-response systems.
Renewable electricity capacity is rising quickly – with an expected growth of over 60% between 2020 and 2026 to 4,800 GW, which is equivalent to the total global power capacity from fossil fuels and nuclear. But it’s not enough, according to the IEA.
Government action to improve permitting and grid integration, as well as consistent policy approaches and remuneration that incentivises clean technologies will help to accelerate this growth, the IEA said.
In Europe, distribution grids will need to invest €375-425 billion over the decade to 2030, largely to keep up with the expansion of variable renewable sources and electrification of industry, transport and buildings and to modernise ageing infrastructure, according to a study released by the European Distribution System Operators in January 2021.
This could have an initial moderate impact on electricity prices and grid tariffs – with the right policy conditions and smart tariff design. But on the plus side, investments in distribution grids could sustain 440,000-620,000 quality and local jobs around the European Union and UK. It could also reduce the bloc’s annual fossil fuel imports by more than €175 billion and average electricity costs by €28-37 billion in the long term.
In 2020, the European Commission’s climate plans foresaw annual grid investments of around €60bn ($70bn) between 2021 and 2030, which was more than double spending in the previous decade, according to the IEA. That’s set to be higher after the EU raised its targets with the Fit for 55 climate plan in 2021.
The grid of the future
The energy transition is well underway, especially in Europe – upending the old grid system at the same time, according to power management company Eaton who have assembled an impressive line-up of speakers for their three-session event on February 8th, 9th and 10th which sets out to establish best practice and a pathway to “Making the transition work, from policy to plant” (you can register for the event here).
After a period of stagnation in developed economies, electricity demand is rising as buildings and transport electricity and data centres expand. Buildings could see a 50% increase in electricity demand by 2050. In the next decade, the electrification of transport could boost global power demand by nearly 30% and demand from data and computing centres could multiply by four, it said.
Meanwhile, the growth of solar, wind, batteries and other clean, flexible technologies means centralised power supply is quickly being replaced by distributed energy systems. More entities – from homes to shopping centres to cars – will be able to produce, store, consume and sell power. Buildings, for example, can become energy hubs equipped to generate their own renewable power, store it, and control when it’s used and when it’s sent into the grid, according to Eaton.
Everything could be seen and treated as a grid. This means the traditional energy sector is changing too, with big technology companies providing digital innovation (digitalisation is seen as an important tool for fast, autonomous handling of grid status) and becoming major consumers.
Energy Post Promoted Event:
“Making the Transition work; from policy to plant”
Day 1: How Policymakers, the Grid and Big Tech Are Key to Net Zero
- Miguel Herrero Cangas, Senior Policy Advisor, Solar Power Europe
- Dipali Raniga, Public Affairs and Policy Manager, National Grid ESO
- Dirk Kaisers, Distributed Energy Management Segment Leader, Eaton
Session One date and time: Tuesday 8th February, 10-11am CET
Day 2: Making Solar Work: From Investment to Project Delivery, with Focus on Security
- Gregor Paterson-Jones, Managing Partner, NGPJ Consulting
- Zoisa North-Bond, CEO, Octopus Energy Generation
- Rafael Narezzi, CTO, CF Partners
- Dirk Kaisers, Distributed Energy Management Segment Leader, Eaton
Session Two date and time: Wednesday 9th February, 10-11am CET
Day 3: A Call to Action on the ‘Dirtiest’ Greenhouse Gas in Clean Energy
- Dr Axel Friedrich, International Expert for Transport and Sustainability, DUH
- Vincent Brongers, Expert Asset Management, Stedin
- Professor Manu Haddad, Cardiff University
- Frits Besseling, Electrical Systems and Solutions Business Development Manager, Eaton
Session Three date and time: Thursday 10th February, 10:00am (CET)
All sessions moderated by Jim McClelland, SustMeme
Big Tech is a driver
Big Tech is already leading the way, both on the consumer and provider sides. Companies have already set their own targets to reach net-zero emissions, or become carbon-negative, by 2030 or 2040. The sector is the largest investor in renewable energy generation worldwide and one of the fastest-growing client groups for clean power projects.
Big Tech’s energy use and emissions are also small in relation to the scale of their operations, according to the IEA. Data centres account for around 1% of global power use, behind industrial motors and air conditioning. Still, the sector’s electricity use and carbon footprint are growing – with the rise of Bitcoin mining, blockchain and machine learning – and technology companies will need to manage it.
While the shift to renewables is happening, it poses new technological challenges for energy utilities, too.
Utility-scale solar has become a particularly cost-competitive option for utilities to decarbonise and manage bi-directional energy flows, according to Eaton. But it also requires them to address regulations and challenges in areas such as energy storage and cybersecurity measures.
The switchgear needed to shift to clean energy sources also comes with a problem: the insulator used in switchgear technology is a source of the major greenhouse gas called sulphur hexafluoride (SF6). Connecting new clean energy to the grid using existing “dirty” switchgear would be a mistake. Cost-effective, technically feasible, energy efficient and reliable alternatives do exist, such as vacuum and air-insulated electrical switchgear. Project developers need to be sure to plan ahead.
Such complications can be managed, with clean and cost-effective alternatives supported, if policymakers can work with the wider sector to create a clear and long-term policy framework.
The potential for integrated resilient smart grids is already unfolding – driven by overarching targets to reach net zero emissions before 2050 and a fast rise in renewable and flexible energy technology. The key is to set a policy foundation in place to enable its rapid growth.
Sara Stefanini is a freelance journalist who writes on the energy sector