The forecast demand is a new challenge surfacing for the US, which now needs to face exponentially increasing demand for critical minerals.

This is according to the New York-based financial information and analytics company’s study, Inflation Reduction Act: Impact on North America metals and minerals report, which finds that the historic policy is accelerating demand for critical minerals and copper that are vital to energy transition technologies.

They add that ensuring enough qualifying supply to meet that demand faces ‘considerable challenges’.

Accelerated demand

Namely, US energy transition demand from clean tech such as EVs, charging infrastructure, solar PV, wind and batteries, will continue to accelerate and be materially higher for lithium (+15%), cobalt (+14%) and nickel (+13%) by 2035 than was projected before the IRA was enacted in August 2022.

According to the study, demand for copper will be 12% higher by 2035 than pre-IRA projections. Copper is not currently listed as a critical mineral in the United States and does not qualify for IRA tax credits. However, its role as the “metal of electrification” makes it vital to the energy transition and demand for it will rise as it is used alongside critical minerals in energy transition applications.

Adding the post-IRA demand increases on top of demand growth that was already expected prior to the IRA becoming law means that total combined energy transition-related demand for lithium, nickel and cobalt will be 23 times higher in 2035 than it was in 2021. Total demand for copper will be twice as high, the study finds.

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While post-IRA demand is expected to be materially higher, securing enough supply under the law’s sourcing requirements faces considerable challenges, the study says. To qualify for IRA tax credits, processing and/or extraction of critical minerals used must be in the US and/ or in a country with which the US has a free trade agreement (FTA); and that sourcing cannot involve a “foreign entity of concern.”

Commenting on the study was Daniel Yergin, S&P Global’s vice chairman: “This new comprehensive analysis shows that the Inflation Reduction Act is indeed transformative on the demand side.

“However, challenges remain in securing supply of critical minerals needed to meet growing demand and achieve its goal of accelerating the energy transition.”

Material breakdown

Of the four materials analysed in the study, only lithium is likely to be sufficiently supplied to the United States under the IRA’s domestic content requirements, given already-planned capacity additions in the United States and other FTA countries such as Chile, Canada and Australia, the study finds.

Cobalt and nickel were both found to be unlikely to be sourced at levels high enough to meet demand.

While there is enough cobalt produced in FTA countries to meet the IRA domestic sourcing requirement, the United States does not currently source most of its cobalt from those countries. Doing so would require a challenging reorientation of trading patterns across several countries given intense international competition for resources, the study says.

Nickel was found to be the most challenged in terms of supply. There does not appear to be enough nickel supply in FTA countries to meet demand under the IRA requirements—even if all primary nickel production in FTA countries was exported to the US.

While copper is not subject to sourcing requirements under the IRA, ensuring access to enough supply to meet US demand post-IRA is also at risk, the study says. The United States will become more reliant on imports as growing demand for energy transition-related end markets outpace domestic supply.

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For example, the United States relies on one country, Chile, for 60% of refined copper imports. However, for Chile the United States accounts for only 20% of its refined copper exports. The United States could struggle to secure additional supplies from Chile if other markets that represent a larger share of Chilean exports also compete for that supply.

The increasing reliance of the United States on imports as energy transition demand grows places new emphasis and urgency on challenges such as long lead times and permitting complexities that prolong development of domestic resources, the study says. S&P Global data on 127 mines across the world that began production between 2002 and 2023 shows that a major new resource discovery today would not become a productive mine until 2040 or later.

Copper represents a particular opportunity in the United States, which country possesses more than 70 million tons of an untapped copper endowment, equivalent to more than 20 years of US copper demand, even at the level of peak energy transition-related demand in 2035, the study says.

“Timely and transparent permitting is a fundamental operational challenge to supplying metals for the energy transition, particularly in developed markets such as the United States that have high levels of transparency and both political and civil society scrutiny of policy,” said Mohsen Bonakdarpour, executive director at S&P Global Market Intelligence.

“Expediting permitting reform while meeting environmental and community concerns has become a central topic in boosting mineral supply for the energy transition.”

This is according to the IEA’s Facilitating Decarbonisation in Emerging Economies Through Smart Charging report, which looks at how decarbonisation can be facilitated through smart charging.

According to the report, although there are several requirements for smart charging to take place, the power sector has a unique role that can’t be overlooked, namely in establishing the foundations of how EVs can be used as a resource.

The potential of smart charging on the power system lies largely in its potency as a flexible asset, states the report, enabling widespread renewable penetration and consumption management.

EV proliferation

According to the report, while most of the uptake of EVs is found in the US, Europe and China, EVs are also starting to penetrate markets in emerging economies.

Electric two- and three-wheelers are more common in Asia, with sales of electric three-wheelers constituting 46% of total three-wheeler sales in the fiscal year of 2022. Meanwhile, electric buses are gaining ground in Latin America, where most have reached cost parity with diesel buses.

These trends are likely to continue as these economies set more adoption targets for the end of the decade.

However, to accommodate the increasing uptake, the necessary charging infrastructure will be needed to coordinate the increasing electric load coming onto the grid.

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While the energy required by EVs is low compared with typical daily electricity consumption, the IEA states how ensuring enough grid capacity will be the more important parameter given the high-power requirements that the charging process can take.

Charging of two- and three-wheelers may not lead to significant increases in peak load until a high level of penetration, whereas charging of buses will raise peak load and often require dedicated transformers.

The role of smart charging

This, states the IEA, is where smart charging needs to be more widely adopted, as it provides an avenue of integrating the EV into the power system where the charging process can be adjusted to be in line with power system objectives.

Said objectives could be voltage regulation and reduction of local peak in the distribution grid, or frequency regulation and energy arbitrage in the bulk energy system.

Smart charging of EV fleets can provide a good source of power system flexibility, increasing the uptake of renewables while maintaining power system stability.

However, for smart charging to be coordinated optimally and support the system, it needs to be able to adjust in response to system signals.

States the report: “The faster the EVs can react, the more services it can provide. Such high levels of coordination can happen only through digitalisation.

“With the help of telecommunications and connectivity, smart charging service providers can exist to help serve as intermediaries to balance the needs of the EV users, charge point operators and power systems.”

Power system measures missing

According to the report, the main signals which can serve as rewards or sources of value for EV users and smart charging service providers are:

• Differentiated tariffs: Tariffs which vary rates based on time of day to incentivise the behaviour of EV users about when to charge their cars

• Procurement of local flexibility: Distribution grid operators enter into contracts with aggregators or charging service providers to manipulate the charging process to achieve local needs.

• Wholesale energy market access: Whereby vehicles can participate in changing the supply-demand curve to lower peak generation and increase renewables consumption.

• Ancillary services market access: Allowing aggregated EVs to respond to system services such as frequency response.

In advanced economies such as California, South Korea, the Netherlands and the UK, each of these power system measures is widespread or in progress, with the exception of procurement of local flexibility in South Korea.

However, for the studied emerging economies, including Brazil, Chile, Colombia, Indonesia, Maharashtra, Morocco, South Africa, Tamil Nadu, Thailand, Tunisia, Uttar Pradesh and Vietnam, the opposite is true.

Differentiated tariffs were found to be the most common measure, although not absent in Colombia and Morocco.

The only other measure found was that of ancillary services in South Africa and in progress in Chile.

Moving forward

According to the IEA’s findings, depending on the degree of EV integration desired by the economy in question, different technological and regulatory frameworks will need to be deployed for the sector to facilitate a fair and efficient smart charging process.

Specifically, they state, the following recommendations are made to establish a smart charging ecosystem:

• Establish a framework for demand response in the power system, which could be implicit via tariff variation or explicit through direct bidding of demand in wholesale and balancing markets.
  
• Ensure standardisation and interoperability; said standards could be set by tying them to charging infrastructure incentives, as a de facto standard based on public tenders, or legislated directly as a regulation
  
• Establish minimum requirements for smart communication and control, thereby ensure future EV uptake will instill the ability to participate in smart charging
  
• Ensure matching with clean electricity, whereby signals to charge could come either from the electricity market through wholesale prices, or from end-consumer electricity prices that reflect the best time to consume clean electricity
  
• Reform the role of distribution operators from passive owners and providers of network capacity into active managers of an interconnected system that can help activate EVs’ full potential

With the major growth of new energy systems expected in the years ahead in the form of renewable generation, particularly solar and wind, along with the supporting transmission and distribution infrastructure, environmental and sustainability considerations are becoming increasingly important for today’s utilities.

With this in mind, Iberdrola has launched the new Carbon2Nature (C2N) company to harness the potential of carbon credit markets to drive the development of projects that will generate the credits and that then would be made available to customers to support their decarbonisation.

Iberdrola’s stated aim is to capture and store more than 61Mt of CO2 in natural sinks such as forests, coastal ecosystems and agricultural soils through the promotion of conservation and restoration projects in these.

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The focus is on regions where Iberdrola is present and where such solutions have significant potential, with over three-quarters of the projects likely in Latin American countries such as Brazil, Mexico, Colombia, Peru and Chile and the remainder in countries in the northern hemisphere, including Spain, the United Kingdom and Portugal.

C2N is already working on the development of projects in Brazil, Mexico, Colombia, Chile and Spain, the company reports.

“To face the global challenge of climate change, the firm was created with the ambition to make a long-term impact at an international level,” says Miguel Ángel García Tamargo, director of Carbon2Nature, who previously held various roles with Iberdrola clean energy subsidiary Avangrid.

“In order to achieve this, it is committed to diversification in geographies and projects and promotes collaborative strategies for their development with local communities and other actors, guaranteeing the highest levels of quality.”

RGI, IUCN energy solutions partnership

Another new initiative in this area is a partnership between the Renewables Grid Initiative – an EU-funded TSO, NGO collaboration – and the International Union for Conservation of Nature (IUCN) with a five-year agreement on the development of sustainable renewable energy and electricity grids.

A key project currently being developed is the ‘Global Initiative for Nature, Renewables & Grids’, with the intent to support key stakeholders to incorporate nature-positive approaches in renewable energy generation and transmission.

If successful, the project should lead to a monitoring and reporting system, showcasing solutions and progress globally.

Antonella Battaglini, CEO of the Renewable Grid Initiative, comments: “It is possible to address climate, energy and biodiversity security in parallel when well planned, energy infrastructure can contribute to create nature protection and restoration opportunities.”

ESB Networks started its deployment of smart meters in the autumn of 2019 and is working through the country on a phased area-by-area basis.

Currently, installations are taking place in County Longford in the central north of Ireland.

Ireland’s Commission for the Regulation of Utilities (CRU) made the decision to implement smart metering for all residential and small business customers in July 2012, following customer behaviour and technology trials and a positive cost-benefit analysis.

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Under the National Smart Metering Programme, which is being delivered by ESB Networks in partnership with the Department of the Environment, Climate and Communications, the Sustainable Energy Authority of Ireland and electricity suppliers, the rollout must be completed for the approximately 2.4 million customers by the end of 2024.

With the smart meters, suppliers are required to offer all users a time-of-use tariff and to make available new services.

ESB Networks also has launched a portal for smart meter users to view their consumption.

At the time of the one million smart meter milestone in October 2022, ESB Networks reported to be installing the new meters at a rate of about 10,000 per week and on track to meet the 2024 timeline.

To date, the programme has focussed on the replacement of standard 24-hour meters to smart meters.

However, the plan is to start from September 2023 also replacing other meter types, including day-night meters, standard 3 phase 24-hour meters with large users including industrial and commercial customers and night storage heating meters.

ESB Networks is installing meters from Kamstrup and Sagemcom.

The trial is to deliver 100% hydrogen gas through a 30km decommissioned pipeline between the eastern Scotland coastal town of Grangemouth and the district of Granton on the outskirts of Edinburgh.

SGN has reported that over the past year, a team of engineers and researchers has carried out surveys and assessments to determine the integrity of the pipeline.

These tests included an operation which involved pushing a pipeline inspection gauge (PIG) through the pipeline using compressed air to clean it and identify any critical defects.

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A hydrotest was also conducted, for which engineers filled the entire pipeline with water exceeding the pressure the pipeline will be exposed to during the live trial.

Inspections of the condition of the pipeline also were performed above ground, below ground and at river crossings.

Based on this evidence, Ofgem has confirmed the suitability of the pipeline for hydrogen testing and for the project to progress to the next stage, which will be to connect the existing pipeline to a hydrogen supply from project partner INEOS from its Grangemouth facility.

Gemma Simpson, SGN Director of LTS Futures, says that offsite trials will allow testing of procedures for making new connections to the pipeline, including the first live welding procedure on a hydrogen pipeline.

“If we’re successful we’ll be able to proceed to a live trial in 2024 which will deliver a blueprint for repurposing Great Britain’s local transmission system network, driving decarbonisation and supporting our net zero goals.”

SGN’s £30 million ($38 million) LTS Futures project is focused on testing and repurposing the decommissioned pipeline as the basis for the wider use of hydrogen within the 11,000 km local gas transmission system (LTS).

Among other activities related to hydrogen, SGN is leading the H100 Fife neighbourhood project to trial the use of hydrogen in around 300 homes and is co-leading a study on the potential use of hydrogen for heating in multi-occupancy residences, which account for about one-fifth of the country’s domestic heating demand.

Currently the length of time taken to build new electricity transmission from identification of need to commissioning is 12 to 14 years but it could be reduced to seven years, Winser has found in a new study undertaken with the Energy Systems Catapult.

This would then bring the construction time in line with for example that of large wind farms and would expedite their integration to the system and reduce the risk of congestion.

The building of new infrastructure – and aspects such as permitting, which is often highlighted – are potential constraints to the meeting of the net zero targets.

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Few new transmission lines have been built in Britain over the past 30 years and investment has not matched that into renewables. For example, the ‘queue’ to connect to the grid is extremely congested, with more than 230GW of generation waiting, compared to approximately 80GW of generation currently connected.

Moreover, a dramatic increase will be required through to 2050.

Winser, the former CEO of National Grid who was appointed the first Electricity Networks Commissioner in July 2022, was tasked with reducing the transmission line build time by three years but has gone further than that, saying it “would remain too long”.

He finds that the current process is complex and involves many different parties.

While significant improvements have been introduced in recent years, the process still has many unfortunate attributes, he indicates. The process for identifying need for new transmission assets is not efficient, the regulatory process is not settled or operating at a system level and planning lacks political or engineering context.

Every part of the process must be, and can be, dramatically improved, says Winser, who provides 18 sets of recommendations, which must be adopted as a package, to meet the 7-year timeline from identifying the need to commissioning new transmission assets.

Proposed transmission development process

Broadly, the report outlines, in the first-year certainty of need will be established early in the process, allowing for appropriate resourcing of design and appointment of contractors in the second year.

The corridor routing stage has been optimised to six months through use of meaningful automation while maintaining assurance of outputs through the efficient involvement of technical experts.

The route design process will be streamlined through standardisation which also facilitates and supports engagement with communities.

By the end of the second year, the supply chain can be engaged, and manufacturing slots can be booked in advance, reducing pressure in the procurement process. With this, detailed designs can be finalised by the end of the third year.

Simultaneously, a streamlined pre-application process can occur informed by surveys available through simplified land access and data sharing mechanisms.

By mid-way through the fifth year approvals and land purchases should have been achieved, allowing for an earlier build start and delivery within seven years.

“Delivering 50GW of new wind power and 24GW of new nuclear will be a major step towards decarbonising our economy and providing customers with clean, secure, affordable electricity, but that magnificent achievement will be wasted if we cannot get the power to homes and businesses,” Winser says in a statement.

“The challenge to me to reduce the timescale for building strategic transmission by three years, and ultimately by a half is the right one. I am confident that this is achievable as long we streamline the process as proposed in the report; and take a transparent, respectful and efficient approach when engaging with people and communities about the impact.”

A key aspect on which the report states further work is needed is to define “with crystal clarity” the roles and responsibilities of the various parties under the proposals, in particular, the government, the regulator Ofgem, the Future System Operator – which should be established quickly – and the transmission owners.

The future system operator is intended to bring together the planning for the electricity and gas systems, and potentially systems for new technologies like hydrogen and carbon capture and storage, into a single institution.

The three transmission operators are National Grid Electricity Transmission, Scottish Hydro Electric Transmission Ltd and SP Energy Networks, which connect with the fourteen distribution network operators across the regions.

These include over £300 million ($381 million) of investment over the next ten years and at least 300 engineering and other high-quality jobs in what the company states as a historically underfunded region.

Northern Gas Networks is currently in discussions with government about the go-ahead of the proposed hydrogen village, which would see around 2,000 homes in the Yorkshire coastal town of Redcar converted to run on hydrogen.

The trial, planned as the follow-on to the current H100 Fife 300 home neighbourhood trial, has been envisaged as the next step towards the potential wider use of hydrogen as a replacement for gas as a support for Britain to reach its net zero targets.

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However, there has been consumer opposition to it, leading to the government in July withdrawing the other contender, Whitby on the northwest coast, which had been proposed by Cadent and British Gas.

While there have been reports of similar consumer concerns in Redcar, clearly they are likely to be an important consideration in the go-ahead of the trial.

“Hydrogen has already been used across the world and in the UK for decades, and as a low carbon option that gives all of the familiarity and comfort of gas, it has a major role to play as part of the net zero solution,” comments Mark Horsley, Chief Executive of NGN.

“How it benefits the local community is a priority, and we are delighted by the investment and jobs it will bring to the resident of Redcar over the next few years.”

Participating homes would be supplied with new hydrogen appliances. In addition, they would be eligible for up to £2,000 in energy efficiency measures such as insulation.

Redcar was chosen by NGN due to plans by bp with its HyGreen Teesside project to produce green hydrogen locally.

The company further anticipates that the hydrogen can be pumped through the existing gas pipes, with limited disruption and additional cost.

The updates to the EIA’s National Energy Modelling System (NEMS) will involve both an advancement of the existing model and new data, while prioritising the requirements of current US laws and regulations.

Commenting on the updates was Sauleh Siddiqui, EIA chief energy modeller, who, referencing an AEO2023 appendix, which details the considered Inflation Reduction Act provisions, stated that the enhancements are being planned to develop a “next-generation, open-source modelling framework that will be nimble and flexible to new technology and policy advancements.

“We will be engaging the modeling community and providing updates as we move forward,” added Siddiqui.

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According to the EIA, a core aspect of their mission is to develop long-term projections of the US energy system that informs decision-makers. This requires keeping pace with rapidly evolving energy markets, policies and regulations, macroeconomic trends, technology innovation and resource availability.

As such, the NEMS update will revolve around garnering a better model to account for developments in hydrogen, carbon capture and other emerging technologies.

Announcing some of the updates on social media, Joe DeCarolis, EIA administrator, stated that the ongoing developments within the policy settings of the US have urged the remodelling to better account for newly proposed regulations, “some of which are still being finalised…we must forge ahead with critical NEMS enhancements to keep pace with the changing dynamics of the energy sector.”

The NEMS is used for the EIA’s Annual Energy Outlook, a yearly report using data from the modelling system. With the update, the outlook will be delayed to 2025. A Short Term Outlook will continue to be produced.

Stated the EIA: “By retooling NEMS in 2024, the next AEO (Annual Energy Outlook) in 2025 will more comprehensively address existing laws and regulations in the Reference case, including up-to-date provisions in the Inflation Reduction Act and regulatory actions that could be finalised in the coming months.”

With imposed and self-imposed deadlines drawing nearer, consumer concerns about the seriousness of climate change remain high with over half of consumers (56%) stating the climate change is serious or very serious.

“Our sustainability index highlights how much work there is to do help consumers understand clean energy goals and the plans in place to meet the goals,” said Andrew Heath, senior director of utilities intelligence at J.D. Power.

Why is this a problem?

The electric grid will require an increased level of customer participation as renewable energy adoption continues. Customers will need to charge electric vehicles at specific times and avoid using excess energy during times of high stress on the grid. This requires an educated consumer who understands how their own energy use impacts the grid and understands the reasons they are being asked to use energy differently. In short, customer buy-in about (or at least awareness of) utility sustainability targets, will help them understand the ‘why’ behind any requests to alter energy use in any way.

“Sustainability is now a strategic focus for electric utilities, and an increasingly critical focus for public policy makers at all levels. Utilities are not in an enviable position, to say the least,” added Heath.

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Communication and customer education is a winning strategy to foster greater customer engagement around sustainability.

“Clear communication about their clean energy goals and plans will build the customer support needed to deliver on these plans,” Heath said.

Following are some key findings of the 2023 index:

Low customer awareness for utility climate initiatives: Overall, just 19% of electric utility customers are aware that their utility has declared a goal to eliminate greenhouse gas emissions. The overall sustainability scores for electric utilities evaluated in the study—which are based on customer awareness, engagement and advocacy for their local utility’s climate initiatives—is 28 (on a 100-point scale), unchanged from 2022.

Few customers feel utilities will reach their goals: Just 26% of electric utility customers say they believe utilities will reach their goal of 100% clean energy. Moreover, the number of customers who say they believe a lot can be done to reduce climate change has declined steadily to 37.3% this year from 40.3% in 2020. More than half (52.7%) of customers say they believe climate change is serious or very serious.

Highest-scoring utilities: Sacramento Municipal Utility District has the highest score for a third consecutive year at 35. Other top performers include NextEra Energy (34), Portland General Electric (34), DTE Energy (32) and Southern Company (32).

Following is the full list of electric utility companies and cities that were evaluated, along with their index score:

“In the long run, an inability to deliver on stated carbon reduction targets will negatively affect credibility and will give regulators and politicians a foothold for increased intervention and closer oversight. Now is the time for utilities to capitalize on widespread customer concern about climate change to proactively share the steps they are taking,” said Heath.

The Sustainability Index evaluates electric utility customer awareness, support, engagement and advocacy for their local utility’s climate sustainability programs and goals. The index applies to the 35 largest U.S. electric utility companies and cities, each serving 500,000 or more residential customers. The study is based on responses from 70,486 business and residential electric utility customers and was fielded from June 2022 through May 2023.

Originally published on Power Grid.

The scheme, which was approved under the State aid Temporary Crisis and Transition Framework, seeks to accelerate investments in strategic sectors in Hungary, in line with the Green Deal Industrial Plan.

The measure will be open to companies producing relevant equipment, namely batteries, heat pumps, solar panels, wind turbines, electrolysers, equipment for carbon capture usage and storage, as well as key components designed and primarily used as direct input for the production of such equipment or related critical raw materials necessary for their production.

Under the measure, the aid will take the form of direct grants and tax advantages.

Aid under the scheme aims to incentivise the production of equipment needed for net zero and will be granted no later than 31 December 2025.

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Europe’s green industry

The State aid Temporary Crisis and Transition Framework will help speed up investment and financing for clean tech production and manufacturing in the continent and will assist Member States in delivering on specific projects under National Recovery and Resilience Plans.

Under the Framework, the following types of aid will be granted by Member States:

• Liquidity support through state guarantees and subsidised loans.
• Aid to compensate for high energy prices.
• Measures accelerating the rollout of renewable energy. Member States can set up schemes for investments in all renewable energy sources, including renewable hydrogen, biogas and biomethane, storage and renewable heat, including through heat pumps, with simplified tender procedures that can be quickly implemented.
• Measures facilitating the decarbonisation of industrial processes, including investments to phase out from fossil fuels, in particular through electrification, energy efficiency and the switch to the use of renewable and electricity-based hydrogen.
• Measures aimed at supporting electricity demand reduction.
• Measures to further accelerate investments in key sectors for the transition towards a net-zero economy, enabling investment support for the manufacturing of strategic equipment, namely batteries, solar panels, wind turbines, heat-pumps, electrolysers and carbon capture usage and storage as well as for production of key components and for production and recycling of related critical raw materials.

Sanctioned Russian-controlled entities will be excluded from the scope of these measures.

Smart Energy Finances: €3bn for German low-carbon tech 

The Green Deal Industrial Plan, announced earlier this year in March, is Europe’s response to increasing global competition in the energy sector and is hoped to enhance the competitiveness of Europe’s net-zero industry.

Also in March, the Commission adopted a new Temporary Crisis and Transition Framework to foster net zero support measures that are aligned with the Green Deal Industrial Plan.

This marks the second tranche of aid for clean tech manufacturing aligned with Europe‘s tabled Green Deal Industrial Plan.

A week before the announcement, a €3 billion ($3.9 billion) German scheme was announced by the Commission under the same category.

Also on the radar are announcements of a ‘resilient’ business model based on smart meter-generated revenue for Smart Metering Systems (SMS), growth financing for a smart meter data analysis provider and a €3 billion ($3.9 billion) scheme for cleantech companies in Germany.

AMI provider Ubiik acquires Mimomax Wireless

Taiwan-based Ubiik, an IoT and Advanced Metering Infrastructure (AMI) provider, has acquired New Zealand-based Mimomax Wireless, a provider of communication solutions for narrowband channels.

The acquisition is being touted as an acceleration of Ubiik’s market expansion.

The new combined entity, which has not yet been named, aims to bring new wireless solutions to market, providing communications for utilities and critical infrastructure.

According to the Taiwanese provider, their current business is on track to exceed 1 million AMI device deployments by 2024, citing the “coverage limitations of existing public LTE networks that impede utilities’ AMI deployments” as the prime challenge they seek a solution towards, the company stated in a joint press release announcing the acquisition.

Since 2007, Mimomax Wireless established itself as a manufacturer of radios utilising Multiple Input, Multiple Output (MIMO) technology.

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The Kiwi company caters to utilities, stakeholders within the energy sectors and governments among others. Their communications solutions, states Mimomax, optimises data throughput and enables near-real-time visibility of critical assets.

Commenting on the announcement was Tienhaw Peng, founder and CEO of Ubiik, who stated how the acquisition “injects additional momentum into our collective growth. In tandem, we’re poised to boost the performance, security and cost-effectiveness of critical networks.”

Ubiik states how the merger will allow for an array of new solutions for mission and business-critical communications. For example, existing US utility customers who have deployed Mimomax products in the narrowband 700MHz Upper Block A can now leverage their spectrum acquisition by adding Ubiik’s goRAN NB-IoT Band 103 as a retrofit.

This opportunity, adds the AMI provider, offers the ability to connect smart meters and IoT devices for “a fraction of the cost of deploying new pLTE infrastructure”.

SMS’s ‘resilient’ smart metering business model

Glasgow-based smart meter and carbon reduction asset developer Smart Metering Systems (SMS) has, within its H1 2023 trading update and outlook report, reported 13.3% revenue growth.

Specifically, the Scottish clean tech company’s Index-linked Annualised Recurring Revenue (ILARR), a referral to revenue generated from meter rental and data contracts, grew from £97.1 million ($125.4 million) at the close of December 2022 to £110 million ($142 million) as of June 30, 2023.

The company’s CEO, Tim Mortlock, commented on the growth, citing the ‘resilience’ of their model:

“We have delivered another strong operational and financial performance during H1 2023, a testament to the resilient nature of our business model which is underpinned by our index-linked recurring revenues.

“Our existing pipeline of meter and grid-scale battery assets is expected to more than double the Group’s EBITDA in c.4 years compared to FY 2022, with significant additional growth opportunities in existing and developing CaRe assets.”

Within the first half of 2023, the company SMS installed 220,000 smart meters and has maintained market share of 14%.

According to the report, their engineering capacity delivered higher volumes of activity, largely driven by transactional callout services alongside a higher proportion of single fuel installations.

The Group also increased its engineering capacity and expects meter installation run-rate to accelerate as a result.

When it comes to financing, the Group claims its current pipeline of smart meters and grid-scale batteries can be fully funded from asset-backed, internally-generated cash flows and debt facilities.

The Group is also considering asset recycling to maintain a “prudent level of gearing in the medium term and to support future growth”, they state in the release.

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Expansion financing for a smart meter data analysis provider

CIBC Innovation Banking has increased its growth financing commitment to Bidgely, a provider of AI-powered energy intelligence solutions for energy providers worldwide.

The additional financing commitment of $18 million – 2020 saw Bidgely secure $8 million from the same company – will strengthen Bidgely’s ability to support critical utility initiatives, namely within the EV and grid modernisation markets.

Bidgely’s UtilityAI analyses smart meter data to provide appliance-level insights into daily energy consumption, giving utilities insights into energy usage patterns and anticipated grid loads.

Bidgely touts its platform’s ability to coordinate accurate grid planning and load forecasting, together with the ability to better manage the influx of EVs on the grid through optimised time of use, load shifting and managed charging.

“Utilities around the world rely on Bidgely’s artificial intelligence-powered energy solution to guide their clients to smart energy decisions,” said Amy Olah, managing director of CIBC Innovation Banking. “Our continued support speaks to Bidgely’s success and our commitment to back innovative software companies across North America throughout their growth journey.”

€3bn for German low-carbon tech – batteries, heat pumps and more

The European Commission has approved a €3 billion ($3.9bn) German scheme under the Temporary Crisis and Transition Framework to support private investments in low-carbon assets for the country’s transition to net zero.

The scheme, touted as in line with the tenets of the proposed Green Deal Industrial Plan, will take the form of direct grants, tax advantages, subsidised interest rates and guarantees on new loans for companies producing low-carbon technologies.

Said companies will include those with business in battery energy storage, heat pumps, electrolysers, wind turbines, solar panel, CCUS and key components needed to produce such tech or related critical raw materials necessary for their production.

The aid will be meted out by 31 December 2025.

For the latest finance and investment news coming out of the energy sector, make sure to follow Smart Energy Finances Weekly.

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Smart Energy International

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The proposals, which are made in the wake of the massive increase in prices sparked by the global energy crisis, are aimed to give consumers more choices of products and services with increased competition among suppliers.

While there has been some innovation in products and business models in the retail market, this has been limited and the uptake of new services has historically been low, according to the government in a new vision document.

Across the market, the vast majority of tariffs only differ by the price charged for using energy and the length of time that price is guaranteed, with the implication for consumers being a very limited set of choices in the market, with little opportunity for finding products or services suited to their individual needs.

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Furthermore, the relative prices of gas and electricity do not accurately reflect their respective carbon intensities, resulting in price signals that are insufficient to incentivise the degree of system-wide electrification required to reach net zero.

Consumers should have access to a far greater range of products and services, better tailored to their individual needs, the document continues. At the same time, retailers that can seize the opportunity to offer greater overall value to their customers should be well-placed to grow and secure sustainable levels of profit.

The document recognises the need to strike the right balance between competition and regulation, with the promise of the removal where possible of regulatory barriers to competition that are not in the interest of consumers.

It also states that a total overhaul of the regulatory framework is not appropriate but instead, a programme of targeted reforms is necessitated.

To this end, a ‘call for evidence’ has been issued in parallel, on aspects of the current retail market framework that act as barriers or enablers for innovation, or that might prevent the retail market from supporting system transformation, as well as on some wider considerations such as consumer protections and arrangements for handling supplier exits among others.

The document notes that by the mid-2020s there should be further expansion of the smart meter rollout, the implementation of market-wide half-hourly settlement, new technical standards for energy smart appliances and tariffs, as well as the continued growth in intermittent renewable generation and electrification of heat and transport.

It concludes: “Smarter technologies, tariffs, and services will empower consumers to take advantage of the new choices they face in the market and enable them to benefit from adjusting their energy usage to better align with the availability of low-carbon electricity. In a well-designed future market, there will be opportunities for all consumers to benefit from these changes, regardless of their level of engagement, energy needs, or income.”

Presenting the proposals, Amanda Solloway, Minister for Energy Consumers and Affordability, said it was about putting power back in the hands of consumers, “giving them greater options to cut their energy bills in a market fit for the future. Today, I’m calling on industry to work with us, and take up the opportunities of investing in low carbon technologies and providing a first-class customer service.”

The European Council’s newly adopted Alternative Fuel Infrastructure Regulation (AFIR) puts in place specific deployment targets that will have to be met in 2025 and 2030 across the transport sector.

Specifically, the regulation will see extensive recharging and refuelling stations for alternative fuels deployed across Europe to support the transport sector in reducing its carbon footprint.

“The new law is a milestone of our ‘Fit for 55’ policy providing for more public recharging capacity on the streets in cities and along the motorways across Europe. We are optimistic that in the near future, citizens will be able to charge their electric cars as easily as they do today in traditional petrol stations,” commented Raquel Sánchez Jiménez, Spanish minister of transport, mobility and urban agenda.

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Main deployment targets for 2025 and 2030

The regulation provides for the following specific deployment targets:

• From 2025 onwards, fast recharging stations of at least 150kW for cars and vans need to be installed every 60km along the EU’s TEN-T network
• Recharging stations for heavy-duty vehicles with a minimum output of 350kW need to be deployed every 60km along the TEN-T core network, and every 100 km on the larger TEN-T comprehensive network from 2025 onwards, with complete network coverage by 2030
• Hydrogen refuelling stations serving both cars and lorries must be deployed from 2030 onwards in all urban nodes and every 200km along the TEN-T core network
• Maritime ports welcoming a minimum number of large passenger vessels, or container vessels, must provide shore-side electricity for such vessels by 2030
• Airports must provide electricity to stationary aircraft at all gates by 2025, and at all remote stands by 2030
• Users of electric or hydrogen-fuelled vehicles must be able to pay easily at recharging or refuelling points with payment cards or contactless devices and without a need for a subscription and in full price transparency
• Operators of recharging or refuelling points must provide consumers full information through electronic means on the availability, waiting time or price at different stations

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The AFIR is part of the Fit for 55 package, which was presented by the Commission in July 2021. The package aims to enable the EU to reduce its net greenhouse gas emissions by at least 55% by 2030 compared to 1990 levels and to achieve climate neutrality in 2050.

The EU’s TEN-T policy aims to develop high-quality transport infrastructure across the EU, consisting of railways, inland waterways, short sea shipping routes and roads linking urban nodes, maritime and inland ports, airports and terminals.

The announcement of the AFIR coincided with the conclusion of negotiations surrounding the newly adopted Energy Efficiency Directive, which sets new binding targets for EU member states to reduce energy consumption.

The amended Energy Efficiency Directive will set energy-saving targets for both primary and final energy consumption in the EU.

With the directive, member states will have to collectively ensure a reduction in energy consumption of at least 11.7% at EU level by 2030.

A monitoring and enforcement mechanism will accompany this objective to make sure member states deliver on their national contributions to this binding EU target.

EU Commissioner for Energy, Kadri Simson welcomed the adoption: “Another milestone has been achieved today towards completing the Fit For 55 objectives. Our increased ambition and stronger measures on energy efficiency will accelerate the energy transition.”

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With the directive, EU countries will now be legally required to prioritise energy efficiency in policymaking, planning and major investments.

EU countries also agreed to almost double their annual energy savings obligation in the coming years.

Under the recast directive, EU countries will be required to achieve an average annual energy savings rate of 1.49% from 2024 to 2030, up from the current requirement of 0.8%, driving energy savings in critical sectors like buildings, industry and transport.

With the definition of energy poverty included in the legislation, EU countries are compelled to prioritise energy efficiency improvements for vulnerable customers, low-income households, and individuals in social housing, including within the scope of the energy savings obligation.

Public sector

The recast directive aims to strengthen the role played by the public sector in enhancing energy efficiency practices.

A significant advancement, states the European Commission, is the introduction of an annual energy consumption reduction target of 1.9% for the public sector as a whole. The annual 3% buildings renovation obligation is being extended to all levels of public administration.

Energy Performance Contracts will be prioritised in the implementation of energy efficiency projects in the public sector, whenever possible. Public bodies will continue to consider energy efficiency requirements when making decisions regarding the purchase of products, buildings and services.

Businesses operating in the EU will be able to benefit from assessments of their energy use practices, with energy management systems becoming a default requirement for large energy consumers exceeding 85TJ of annual energy consumption and will be subject to mandatory audits in the event of non-compliance.

Enterprises with an energy consumption above 10 TJ will have to perform an energy audit and prepare an action plan for the different recommendations.

Data

The agreement also introduces a reporting scheme of energy performance in large data centres, promoting transparency and optimisation of energy efficiency potential.

Given the importance of digitalisation and data centres, the directive introduces an obligation for the monitoring of the energy performance of data centres.

An EU-level database will collect and publish data, which is relevant for the energy performance and water footprint of data centres with significant energy consumption.

Heating, workforce and financing

The new legislation promotes local heating and cooling plans in larger municipalities.

Based on the revised definition of efficient district heating and cooling included in the legislation, minimum requirements will be gradually tightened in the coming years towards achieving a fully decarbonised district heating and cooling supply by 2050.

EU countries will also need to ensure that certification and qualification opportunities are available for energy efficiency-related professions.

The agreement supports energy efficiency financing provisions to facilitate investments, including from the private sector, which has a key role to play given the limited public resources available for the clean energy transition.

EU countries are tasked with promoting innovative financing schemes and green lending products, ensuring wider access through transparent investment. Enhanced reporting on energy efficiency investments will improve accountability and transparency.

The Council’s endorsement follows the one given by the European Parliament earlier this month and marks the final step in the legislative process that started in July 2021 as part of the ‘Fit for 55’ package.

As part of the Clean Energy for all Europeans package, the Energy Efficiency Directive underwent significant amendments in 2018, introducing updated energy efficiency targets of at least 32.5% by 2030, based on 2007 projections. Additionally, an extended energy savings obligation was implemented, specifying annual energy savings targets for EU countries during the 2021-2030 period.

The Commission’s proposal for a second revision (a recast) of the Energy Efficiency Directive was put on the table in July 2021 as part of the Fit for 55 package. This proposal included an energy efficiency target of 9% compared to the 2020 reference scenario, asserting the important role to be played by energy efficiency in Europe’s efforts to reduce net greenhouse gas emissions.

The energy transition is bringing profound changes across the sector and not least to the networks, with the need for their significant expansion for large-scale electrification and clean energy integration coupled with the universal adoption of digital smart grid technologies towards 2050.

With this in mind ISGAN, in partnership with IRENA and a group of experts from across the sector from 12 countries, has undertaken an evaluation of grid planning practices with the aim to cut through the complexities and uncertainties for policy makers and sector stakeholders.

“Overcoming these different complexities and uncertainties necessitates planning processes that are efficient, transparent, legitimate and guided by sound principles and effective steering mechanisms,” states ISGAN.

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Moreover, a key consideration was that the grid planning should align with and act as an enabler of the UN’s Sustainable Development Goals of which the energy goal on access to clean and affordable energy is SDG 7.

Key recommendations of the policy brief for grid planning in uncertain times are as follows.

1. Cohesive scenarios, nationally and where possible regionally coordinated, should be developed that show the necessary electrification measures required to achieve net zero emissions.
2. Grid development plans should be ensured to enable deep decarbonisation in line with the developed scenarios, with political guidance likely to be necessary to balance conflicting goals between local and national levels as well as between economic, social and environmental considerations.
3. Cost-benefit analyses should be updated to properly capture the values of sufficient grid capacity and account for social, environmental and resilience metrics, based on a clear and transparent grid planning assessment framework.
4. Regulatory frameworks should be ensured to foster both conventional and smart grid solutions contributing to the clean energy transition. Tools such as regulatory sandboxes could be extensively used to support the deployment of innovative solutions.
5. Workforce strategies should be developed to recruit and train the skills to satisfy the short and long-term competence needs. These include policy and regulation, engineering, environmental impact assessment, behavioural sciences and urban and rural planning.
6. Stakeholder interactions between government, industry, research and other players including local communities should be promoted at all levels of the grid planning process.
7. Awareness and understanding of the role of the grid for meeting the SDGs should be increased, with clearer linkages of energy to supporting other goals such as poverty reduction and climate action.

The initiative was led by Helena Lindquist, director of the Swedish sustainability knowledge sharing company LightSwitch from ISGAN’s Communication working group, and Susanne Ackeby, an R&D engineer at the Swedish research institute RISE from ISGAN’s Power Transmission & Distribution Systems working group.

The current flexibility requirements in the EU correspond to 11% of the total electricity demand but the study indicates the need for growth to 24% in 2030 and 30% by 2050 in order to balance supply and demand with the increasing levels of variable renewable energies to meet the region’s ambitions.

In absolute terms the average requirements for the EU resulting from the modelling for 2030 are 0.79TWh/day, 4.93TWh/week and 14.39TWh/month respectively for the daily, weekly and monthly flexibility requirements.

For 2050, these numbers increase to respectively 2.52TWh/day, 14.6TWh/week and 41.68TWh/month. Summed across all timescales, this corresponds to 2,189TWh – approximately 30% of the estimated 7,300TWh 2050 demand and about 80% of the current (2020) demand of around 2,750TWh.

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The report states that the study has indicated evidence for significant correlations between the daily flexibility requirements and the share of solar PV production on the one hand and between the weekly and monthly flexibility requirements and the share of wind production on the other.

While electricity generated from solar PV plants typically follows a specific daily generation profile, wind production profiles more tend to follow the monthly seasonality. Efficiently integrating both sources of renewable energy sources in the power system thus requires an adequate evaluation of both short-term and long-term flexibility solutions.

Flexibility technologies

In terms of technologies offering flexibility solutions, the study finds that interconnections play a dominant role in addressing the flexibility needs in 2030 on all timescales but particularly on the longer-term timescales.

Storage solutions like batteries, electrolysers and pumped hydro also play a significant role, with the former almost exclusively targeting daily flexibility needs but the latter also targeting long-term flexibility needs.

Demand response from households and industry will also play a role in the flexibility mix and thermal units, of which production can be dispatched, also remain an important contributing factor.

This shows that to address the flexibility needs in the future a combination of technologies is required, including new storage solutions as well as more conventional assets.

Regarding storage specifically, the study suggests that compared to other technologies, it would only be able to recover a modest fraction of capital expenditure from market revenues gained on the spot market by 2030, and would thus exhibit a strong reliance on income streams from other market segments or further sorts of economic incentives.

Looking towards 2030, a relatively limited increase of storage capacity is projected, with additional capacity requested mainly when member states experience congested interconnector capacity over considerable periods of time.

If this interconnector capacity were lower than the current targets, lithium-ion batteries would be a key source of flexibility by balancing short-term system deviations. Further interconnection constraints would increase the importance of longer-duration batteries.

The study, from the Manufacturers Association (MAKE UK) and software company Sage, found that almost two-thirds of the companies that had adopted digital technologies were making energy savings.

Half of them reported savings of between £10,000 and £100,000 ($12,850 – $128,500) in the past 12 months, while most of the rest reported savings below £10,000 that were nevertheless still significant to their balance sheet.

Moreover, the companies reported other benefits beyond energy savings, including labour and non-labour elements such as water savings and less material wastage.

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“Britain’s manufacturers have long been at the forefront of digital innovation globally and they have taken significant steps to cut carbon emissions and move towards net zero,” comments Stephen Phipson, CEO of MAKE UK, calling on the government to help to drive the process forward.

“Government needs to help them move forward faster by committing to a national rollout of the industrial digitalisation programme Made Smarter across the UK and expand its remit to include industrial decarbonisation.”

Made Smarter was formed as a public-private platform to connect manufacturers to digital tools and skills to advance their business operations.

While the traditional wisdom is that electrification is the key to decarbonising industry and manufacturing, the study shows that digitalisation is also a significant contributor.

Almost half of companies surveyed said that digitalisation has been their firm’s top driver of productivity improvements, with production processes streamlined and tightened up.

Multiple digital technologies are being deployed. In particular, manufacturers are using new data analytics tools, new data capturing tools and supply chain management tools to decarbonise.

Data analysis has also proved popular with manufacturers to help them drive energy efficiency and decarbonise their businesses with over a third of companies surveyed highlighting this as being helpful to their business.

The survey found that almost half of the manufacturers have implemented or are planning to implement plans to increase their energy efficiency, with just 16% having no plans.

Nevertheless, barriers to digitalisation remain, the survey found. These include the upfront investment costs and skills shortages.

Among the other recommendations is the introduction of a ‘Help to grow green’ scheme, with existing funds reshaped to become more accessible and including smaller funding levels, for example for energy audits and submetering.

At Bertikow, wind turbines and other renewable generation systems with a total capacity of over 500MW are connected to the nearby 50Hertz substation. Through the project and in the future, they will provide the reactive power necessary for voltage stability, and thus overall grid stability, even when little wind feed-in is available.

Reactive power, states 50Hertz, ensures the smooth transmission of electricity over long distances. It can be used to compensate for voltage losses during transmission so that as much active power as possible reaches the consumer and the grid functions safely and reliably.

Until now, reactive power has mainly been provided by conventional power plants while in operation. Under current regulations, renewable energy plants do not have to deliver reactive power in periods when they provide less than 10% of their active power.

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50Hertz highlights how this presents a challenge for power grid operators as they have to compensate for the necessary reactive power with other technical systems in order to maintain voltage stability at these times.

However, modern wind turbines are also technically capable of providing reactive power, even when there is little or no wind.

In the pilot project, ENERTRAG and 50Hertz want to test how reactive power activation works technically in practice and can be contractually designed, including with a view to a future reactive power market.

“Innovative solutions for reliable power grid operation are absolutely vital for the energy transition,” said Dr Dirk Biermann, chief markets & system operations officer at 50Hertz. “At 50Hertz we’re testing a range of options.

“The permanent provision of reactive power by renewable energy plants is new technological and regulatory territory. Grid operators at the distribution system level, where the majority of renewable energy systems are directly connected, will therefore also benefit from the insights we’re acquiring here.”

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“In the context of the energy transition, renewable energy systems will have to fully provide the system service that is currently still supplied to the grid by conventional power plants,” added Thorsten Leske, head of electrical grids at ENERTRAG.

“In the pilot project, different renewable energy systems will supply reactive power to stabilise the transmission grid, even when there’s no wind. At the same time, this is an example of subordinate distribution grids in which the technical possibilities of renewable energy systems haven’t yet been fully exploited. The next step should be to establish a market model for the provision of reactive power.”

This number is higher than anticipated and is equivalent to taking a million cars off the road or avoiding the burning of 500,000 tonnes of coal, according to the DCC.

The research draws on the recent smart meter impact study for the government, which found that the energy savings were higher than expected, at 3.4% for electricity and almost 3% for gas.

Adopting these figures and applying them across the 16.5 million properties on the DCC’s network, the organisation further estimates that when applied to the current energy price cap, homes and small businesses have the potential to save £770 million (US$993 million) annually collectively.

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“We are delighted to have reached this milestone, which shows the power of collective action on climate change. Small changes in homes across the nation are adding up to power station sized savings,” says DCC Chief Operating Officer, Penny Brown.

“The DCC network is transferring the vital data needed to make the most of renewables on our energy grid. At the DCC our purpose is to make Britain more connected so we can all live smarter, greener lives.”

Rollout update

The DCC’s latest data indicates that there are 16.04 million SMETS2 meters and almost 11.5 million SMETS1 meters totalling almost 27.5 million smart meters and covering more than half of homes connected to the DCC network, with the daily connection rate averaging around 15,000.

The government Department for Energy Security and Net Zero’s latest statistics to the end of March 2023 record a total of 32.4 million smart and advanced meters – 57% of all meters – with 29.4 million operating in smart mode in Britain.

The latest data from Electralink indicates that after a slowing in new smart meter installations early in 2023 the number has increased subsequently and the latest for the month of June of 209,000 installations is now above the 2022 monthly average of 197,000.

Nevertheless, for the first half of 2023, the 1.153 million installations is still down on the 1.181 million in the first half of 2022.

Despite the increase, suppliers are facing challenges in meeting the rollout targets, set to achieve full rollout by the end of 2025, a major one being a skills shortage.

The smart meters transmit energy readings every 30 minutes to the DCC’s network and this data is automatically shared with energy suppliers and grid operators, to provide them with a near real-time understanding of energy usage and enable them to utilise it to incentivise demand flexibility.

Among the consumer-related amendments proposed with the current price volatility in mind, consumers should have the right to fixed price contracts and dynamic price contracts, as well as more key information on the options they sign up to and a banning of suppliers from being able to unilaterally change the terms of a contract.

It also was advocated that EU countries should prohibit suppliers from cutting the electricity supply of vulnerable customers, including during disputes between suppliers and customers, and prevent them from requiring these customers to use prepayment systems.

The Committee also backed wider use of ‘Contracts for Difference’ (CfDs) to encourage energy investments and suggested leaving the door open for equivalent support schemes after approval by the Commission.

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The importance of power purchase agreements (PPAs) was also highlighted in providing consumers with stable prices and renewable energy providers with reliable revenues.

The European Commission is tasked with setting up a marketplace for PPAs by the end of 2024.

Commenting on these outcomes, rapporteur Spanish MEP Nicolás González Casares said that with the agreement, “the parliament is putting citizens at the centre of the design of the electricity market, promoting the right to share energy, reducing price spikes and promoting affordable prices for citizens and companies”.

“We turned CfDs into the reference system for encouraging the electricity sector to transition towards a renewable-based zero emission system. A system that will improve make companies more competitive through clean electricity at competitive and stable prices.”

System flexibility

The other key focus of the Committee was system flexibility, with it advocating in favour of ‘non-fossil flexibility’ and flexibility on the demand side, for instance via the use of home battery systems to help balance the grid and to empower consumers to adapt their consumption to prices and needs.

These provisions have been welcomed by the European Association for Storage of Energy (EASE), which said in a statement they would give investors confidence in energy storage technologies to provide the flexibility needed to integrate further renewable energy.

Member states would now have the powers to set up non-fossil flexibility support schemes, which provide energy storage a solid business case.

Additionally, EU countries must now assess the flexibility needed in the electricity system to deploy further sources of renewable energy in line 2030 climate goals, and set a national objective for energy storage.

The Commission is expected to introduce a strategy for energy storage from 2025, to ensure a harmonised approach across the EU.

The reform package will now go to the Commission and Council.

The annual update of the IEA’s Tracking Clean Energy Progress online resource shows notable gains in the past year. Electric car sales reached a record high of more than 10 million in 2022, a nearly tenfold increase in just five years. Renewable electricity capacity additions rose to 340 GW, their largest ever deployment. As a result, renewables now account for 30% of global electricity generation. Investment in clean energy reached a record $1.6 trillion in 2022, an increase of almost 15% from 2021.

The transition to clean energy is occurring at different speeds across regions and sectors, however. For example, nearly 95% of global electric car sales in 2022 took place in China, the United States, and Europe.

Clean energy deployment is also occurring faster in some parts of the energy system – such as electricity generation and passenger cars – where costs have fallen and technologies are already relatively mature. Meanwhile, innovation is still needed to bring to market clean technologies for parts of the energy system where emissions are harder to tackle, such as heavy industry and long-distance transport. Positive steps on innovation have been made in the past few years, but further acceleration is needed to soon bring to market more low-emissions technologies for these areas, IEA says.

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The 2023 update of Tracking Clean Energy Progress tracks progress towards aligning the global energy system with a path to reaching net zero emissions by 2050. It does this by assessing over 50 different components, from sectors to technologies to infrastructure. The IEA also released the redesigned Clean Energy Technology Guide, an interactive digital database that allows users to visualize the readiness and geographical distribution of more than 500 different innovative technologies or components across the global energy system, along with the accompanying Clean Energy Demonstration Projects Database.

Although many sectors are not yet fully on track for international climate goals, the new analysis identifies crucial advances over the past year. For the first time ever, announced manufacturing capacity for electric vehicle batteries has reached levels sufficient to fulfill expected demand requirements in 2030 in the IEA’s scenario for achieving net zero emissions by 2050. This is backed by the momentum from industrial strategies such as the Inflation Reduction Act in the United States and the European Union’s Green Deal Industrial Plan.

Solar PV has been upgraded to “on track”, as its progress now aligns with milestones consistent with net zero ambitions. Solar PV generated a record of nearly 1,300 TWh in 2022, up 26% from 2021 and logging the largest absolute generation growth of all renewable technologies in 2022. The number of manufacturing projects in the pipeline for solar PV also saw massive growth in the context of widespread government support, especially in China, the United States, and India. If all announced projects are realized, global manufacturing capacity for solar PV will more than double in the next five years, outpacing 2030 demand in the IEA’s Net Zero by 2050 Scenario.

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Notable progress was made in the buildings sector – which has been upgraded from “not on track” to “more efforts needed” in the Tracking Clean Energy Progress three-tier rating system. Governments are increasingly introducing stringent building energy codes and performance standards, and the use of efficient and renewable technologies for buildings such as heat pumps and low-emissions cooling equipment is accelerating. Energy efficiency policies were also strengthened globally in the past year, such as in India, which enacted new policies for appliances, vehicles, industrial facilities, and commercial buildings.

Policy is advancing in many regions. Earlier this year, for example, Indonesia became the first country in Southeast Asia to establish a legal and regulatory framework for carbon capture, utilization and storage, and Namibia released a hydrogen strategy in late 2022.

Several technologies have seen breakthroughs in innovation since the last updates to the IEA’s Tracking Clean Energy Progress and Clean Energy Technology Guide. The world’s largest battery manufacturer announced it would begin production of sodium-ion electric vehicles batteries, an alternative battery chemistry that can help reduce reliance on in-demand critical minerals. Two large-scale demonstrations of solid oxide electrolyzers, a technology to produce low-emission hydrogen, started operating earlier this year. There have been positive steps in innovative clean technologies for aluminum refining and cement-making – both industries in which emissions are difficult to tackle. Furthermore, in early 2023, the first shipment of liquid carbon dioxide was taken from Belgium to be geologically stored off the coast of Denmark beneath the North Sea.

While progress can be observed across all of the 50-plus components of the energy system evaluated in Tracking Clean Energy Progress, the majority are not yet on a path consistent with net zero emissions by 2050.

Originally published by Sean Wolfe on Renewable Energy World.

This comes courtesy the market researcher’s report Smart Energy Communities, which pools their value within the smart cities technology market, anticipated to grow from $36.7 billion in annual revenue in 2023 to $73.3 billion by 2032, at a compound annual growth rate (CAGR) of 8.0%.

Growing demand and drivers

“SECs offer a more modular, more resilient, and cleaner approach to how residents interact with the energy infrastructure around them. Active SECs have proven their success at improving the quality of energy for vulnerable communities,” says Grant Samms, research analyst with Guidehouse Insights.

“While SECs today are generally considered a novel approach to meeting energy challenges, growing emphasis on the need to improve energy performance will drive considerable adoption in the coming decade.”

Reducing costs and improving energy stability, especially for isolated or otherwise vulnerable communities, continue to be the largest drivers of SEC adoption, finds the report.

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Expensive and unreliable energy connections often coincide with such geographic or socioeconomic vulnerability due to historic underinvestment.

Addressing energy reliability issues through microgrids or community heating districts were also found to present a prime opportunity to meet sustainability goals, which are themselves a strong driver of SECs.

Governments and communities are also using opportunities presented by electric vehicle (EV) adoption, like vehicle to grid (V2G) services, to improve SEC performance and sustainability. Found to be financially supporting these drivers are large infrastructure and climate investment packages that have been passed by numerous governments.

Barriers hampering growth

In many ways, SECs are a strong tool for governments that have set goals for improving sustainability and lessening social vulnerabilities.

However, as is predictable for a developing market space, there are also many barriers to SEC adoption, states the report.

In particular, they pose challenges in cost and complexity owing to unfamiliarity and lack of standardisation around installation. This is hoped to lessen as governments, vendors and grid operators become more familiar with SECs and installation methods become more standardised.

Additionally, the surrounding grid may not be robust enough to allow for the addition of new smart energy technologies that accompany such communities.

And while the public is becoming more aware of the benefits of things like home battery storage and smart meters, there may still be public pushback against SEC development over a variety of concerns, from privacy to a loss of local autonomy.

The newly announced National Cybersecurity Strategy Implementation Plan (NCSIP) – announced via a Washington-issued fact sheet – details over 65 Federal initiatives, from combatting cybercrimes to building a skilled cyber workforce.

The initiatives are grouped under five pillars – Defending Critical Infrastructure, Disrupting and Dismantling Threat Actors, Shaping Market Forces and Driving Security and Resilience, Investing in a Resilient Future, and Forging International Partnerships to Pursue Shared Goals – the fourth of which details the US’ action plan to bolster energy-minded cyber measures.

The Office of the National Cyber Director (ONCD) will coordinate activities under the plan, including an annual report to the President and Congress on the status of implementation.

Strategic objective: ‘Secure Our Clean Energy Future’

Under Investing in a Resilient Future, clean energy cyber resilience initiatives fall under the Secure our Clean Energy Future strategy.

States the National Cybersecurity Strategy: “Our accelerating national transition to a clean energy future is bringing online a new generation of interconnected hardware and software systems that have the potential to strengthen the resiliency, safety, and efficiency of the US electric grid.

“These technologies, including distributed energy resources (DERs), smart energy generation and storage devices, advanced cloud-based grid management platforms, and transmission and distribution networks designed for high-capacity controllable loads are far more sophisticated, automated and digitally interconnected than prior generations of grid systems.”

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To protect said systems, under the implementation plan the following initiatives aim to combat and prevent energy sector cyber crimes:

• Drive adoption of cyber secure-by-design principles by incorporating them into federal projects (initiative 4.4.1)

The DOE, working with ONCD and CISA (Cybersecurity and Infrastructure Security Agency), will work with stakeholders to identify and implement cyber secure-by-design pilot projects, identify economic incentives for cyber secure-by-design, identify needed technology vehicles to apply cyber secure-by-design principles and measure progress on national implementation of cyber secure-by-design efforts for critical energy infrastructure.

The DOE will also continue to promote cybersecurity for electric distribution and DERs in partnership with relevant stakeholders.

• Develop a plan to ensure the digital ecosystem can support and deliver the US government’s decarbonisation goals (initiative 4.4.2)

The ONCD will develop a plan to ensure that the digital ecosystem is prepared to incorporate novel technologies and dynamics needed for the energy transition.

Cybersecurity will be built in through the National Cyber-Informed Engineering Strategy, rather than developing a patchwork of security controls after these connected devices are widely deployed.

• Build and refine training, tools and support for engineers and technicians using cyber-informed engineering principles (initiative 4.4.3)

DOE will work with stakeholders to build the National Cyber-Informed Engineering Strategy to advance the training, tools and support for engineers and technicians to enable them to design, build and operate operational technology and control systems that are secure- and resilient-by-design.

Each initiative under the five pillars is assigned to a responsible agency; 18 agencies in total are leading the initiatives.

This is the first iteration of the plan, which is a living document that will be updated annually.

The EIB’s Board of Directors decided to raise the additional funds earmarked for projects aligned with REPowerEU – a plan designed to end Europe’s dependence on fossil-fuel imports – from the initial €30 billion ($33.5 billion) package announced in October 2022 to €45 billion ($50.2 billion). The decision was made at the EIB Group’s July meeting in Luxembourg.

The new funding marks a fresh record for the Group, expanding its support to the build-up of manufacturing capacity for strategic net-zero technologies and products.

Projects eligible for financing include renewables, energy storage, grids and energy efficiency, as well electric vehicle charging infrastructure.

In practice, the EIB will support manufacturing in solar and thermal photovoltaics, onshore and offshore wind turbines, battery storage, heat pumps, electrolysers and fuel cells, grid technologies, sustainable biogas and carbon capture and storage.

All projects must comply with the Bank’s environmental, social, climate and procurement standards.

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The additional funding will be deployed by 2027 and is expected to mobilise in total more than €150 billion ($167.3 billion) in investment.

Also eligible are investments related to the extraction, processing and recycling of related critical raw materials.

Also aligning with the Green Deal Industrial Plan, the EIB has stated it will support the re-skilling and upskilling cost of the EU’s workforce and work closely with education systems and institutions, including in vocational education and training, to ensure that they have the proper means to deliver the required set of skills for the net-zero transition.

The EIB’s Board of Directors also approved €10 billion ($11.2 billion) in new lending for projects.

The approvals include new wind and solar generation in Spain and Austria, grid upgrades in Italy, and an electric vehicle battery cell manufacturing Gigafactory in France.

“We are deploying the full range of our available financial firepower to support Europe’s industrial competitiveness, manufacturing and the rollout of critical technologies that will lead us to a swift and just transition to net zero,” said EIB president Werner Hoyer. “The people of our Union can always count on the unwavering support of their Bank.”

90% of the additional lending foreseen under the EIB’s REPowerEU+ package will be provided by the EIB; the remaining 10% via the EIF (European Investment Fund), subject to EIF Board approval.

Outside the EU, the Board also approved financing for a new electricity interconnector between Ecuador and Peru and streamlined financing for small-scale clean energy and green transition projects across Africa.

The law will set energy-saving targets in both primary and final energy consumption in the EU.

With the directive, member states will have to collectively ensure a reduction in energy consumption of at least 11.7% at EU level by 2030 (compared to the projections of the 2020 Reference Scenario).

A monitoring and enforcement mechanism will accompany this objective to make sure member states deliver on their national contributions to this binding EU target.

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By 2030, member states need to save on average 1.5% per year. The annual energy savings will begin with 1.3% in the period until the end of 2025 and will progressively reach 1.9% in the last period up to the end of 2030.

The saving targets should be met through local, regional and national measures, in different sectors – such as public administration, buildings, businesses and data centres.

Member of the EU parliament insisted that the scheme should in particular cover the public sector, which will have to reduce its final energy consumption by 1.9% each year.

Member states will also need to ensure that at least 3% of public buildings are renovated each year into nearly-zero energy buildings or zero-emission buildings. The directive also establishes new requirements for efficient district heating systems.

Member of Parliament Niels Fuglsang, who negotiated the Directive as rapporteur, said: “The energy crisis is not over. There is no guarantee that the next winters will be as mild as the last one. In the next seven years, we have to deliver the needed structural changes.

“I am very happy that we succeeded in pushing member states towards far more ambitious energy efficiency targets. This is crucial so that we no longer depend on Russian energy in the future and can meet our climate targets. Today’s vote is a great victory; it is not only good for our climate, but bad for Putin.”

Parliament adopted the legislation by 471 votes to 147 with 17 abstentions. It will now also have to be endorsed by the Council of Ministers before it can enter into force.

On 14 July 2021, the European Commission adopted the ‘Fit for 55’ package, adapting existing climate and energy legislation to meet the new EU objective of a minimum 55% reduction in greenhouse gas (GHG) emissions by 2030

The package included the recast of the existing Energy Efficiency Directive, aligning its provisions with the new 55% GHG target.

The installation of the smart meters will be in the city of Raipur, the state’s capital, and surrounding areas.

The contract with a value of Rs17.4 billion ($212 million) also includes the operation and maintenance of the smart meters over a 10-year period.

“[The project] is a testament to our execution expertise in delivering high value and specialised projects which are aimed at transforming the power distribution domain,” said Praveer Sinha, CEO and MD of Tata Power, about the award.

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The project is being executed under the Revamped Distribution Sector Scheme (RDSS) and is expected to improve the losses within the designated area and increase the revenue collection for state owned discom, which is responsible for providing electricity across the state of Chhattisgarh.

The award to Tata Power is one of three smart meter tenders covering different areas being made by CSPDCL, although the other two have so far not been publicised.

They nevertheless indicate the scale of awards which are required to meet India’s 250 million smart meter rollout by 2025/2026 target in India.

In order to accelerate projects and control their costs under the RDSS, they can be executed on a ‘totex’ basis, which looks at the total costs over the operating life with no distinction between capex and opex.

Other smart metering rollouts Tata Power is involved include a 750,000 unit deployment for its customers in Mumbai.

In other recent news Indian smart metering company Genus has partnered with Singapore based investor GIC to set up a jv funding platform with a $2 billion initial pipeline.

During a webinar discussing the report’s findings, Lauren Stuchfield, energy analysis and insights manager for ESO, commented: “Policy is not always enough. We must see the action on [the] back of this policy in order to achieve net zero.”

Added Fintan Slye, executive director of the ESO: “The world is heating up and the clock is ticking; the time for action is now.”

The 2023 report makes the following recommendations:

1. Policy and delivery

Net zero policy: The Government must continue to reduce investment uncertainty around the business case for net zero-critical technologies such as Long Duration Energy Storage (LDES), transport and storage of hydrogen and CO2, low carbon dispatchable power and negative emissions technologies. A clear plan is needed for the funding and development of hydrogen and CCUS projects beyond delivery of the first industrial clusters.

Focus on heat: There is a need to accelerate both the uptake of heat pumps and the decision on whether hydrogen will be used for large-scale heating. While some progress is being made through the Boiler Upgrade Scheme, further policy support and incentives are needed to increase the uptake rates of heat pumps. Alongside this, a clear decision on hydrogen for heating should be accelerated and heat pump targets and incentives reviewed accordingly.

Negative emissions: Negative emissions technology is required to enable a net zero energy system. Robust emissions accounting standards are needed to ensure both investor and public confidence in a negative emissions market. Further demonstration of innovative emissions removal technologies is required to reduce uncertainties over technology and commercial readiness.

Although these movements in policy are needed, caution should also be taken to look beyond. So stated Lauren Stuchfield, energy analysis and insights manager for ESO: “Policy is not always enough. We must see the action on [the] back of this policy in order to achieve net zero.”

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2. Consumer and digitalisation

Empowering change: There is a need to instil trust for consumers and they must be advised on how they can best engage in the energy transition. This could be delivered through an information campaign, supported by a national advice service.

Digitalisation and innovation: Innovation and smart digital solutions are required to enable consumers to further benefit from energy savings at times when they are not able to manually adjust their demand.

Mandating technology manufacturers to include smart capability in their products is key to the delivery of smart homes. Further incentives and grants can encourage greater innovation and implementation of smart digital solutions. Successful delivery of Market wide Half Hourly Settlement will enable consumers to participate more readily in demand flexibility.

Energy efficiency: Further emphasis is needed to harness the potential of efficiency improvements in reducing energy demand. Energy efficiency improvements to the construction and technology within our homes must be accelerated. Radical overhaul is required to achieve this both in new build and existing housing stock. Targets for minimum energy efficiency standards should extend beyond the private rented sector. Additional incentives and grants must be considered to ensure energy efficiency improvements are available for more consumers.

3. Markets and flexibility

Distributed flexibility: The growth of distributed flexibility (flexible energy demand resources, such as storage, EVs, heat pumps and thermal storage, connected at distribution level) is a key enabler to achieving net zero. A market-wide strategy, including government targets, policy support and market reform is required to facilitate the significant growth in distributed flexibility. This can also provide incentives for consumers to provide Demand Side Response, such as smart charging of EVs.

Transport flexibility: Across all future scenarios, cars are primarily electrified, increasing electricity demand and requiring strategies to manage how they are charged and how system costs are recovered. Increasing implementation of smart EV charging is a no regret action to help reduce the impact on peak demand and reduce curtailment of renewables.

Commercial trials of Vehicle-to-Grid (V2G) business models are required to explore their viability and contribution system services. It also requires current challenges to be addressed, such as the slow rollout of charging infrastructure.

Locational signals: Market reform is needed to provide the real-time locational signals required to optimise decisions on when and where flexible energy sources are used. Improving locational signals has the potential to deliver significant cost savings to consumers and support the delivery of decarbonisation targets.

4. Infrastructure and whole energy system

Strategic network investment: Strategic and timely investment across the whole energy system is critical to achieving decarbonisation targets and minimising network constraints. Accelerated coordinated planning and delivery of strategic, whole system investment through Centralised Strategic Network Planning (CSNP) will require continued collaboration and engagement with the Government, Ofgem, local communities, industry and the supply chain. Strategic network investment should be enabled through reforms to the planning system, while also balancing social and environmental impacts.

Connections reform: Connections reform is required to facilitate quicker, more coordinated and efficient connection to the GB electricity system to deliver net zero. Continued collaboration between Government, Ofgem and industry is critical. The process must be future-proofed to facilitate potential prioritisation of connections for delivery of whole system benefits and net zero in line with strategic network planning.

Location of large electricity demands: New large electricity demands, including electrolysers to convert electricity to hydrogen, will be required for net zero. This demand has significant potential to deliver whole system flexibility and reduced network constraints alongside decarbonisation. A coherent strategy is required to ensure large electricity demands are located where they provide the biggest benefit to consumers and the whole energy system.

Industry response

Responding to the report, Jon Ferris, head of flexibility and storage at LCP Delta, commented: “The report is a transformation from a few years ago, where scenarios largely failed to meet the net zero target. Three scenarios describe three different, plausible pathways to get there by 2050, but also highlight the risk that we don’t – electrification of heat and heavy industry, grid reinforcement, market reform and supporting demand side flexibility remain challenges that need to be addressed.”

“EVs are clearly winning in transport decarbonisation, but only a small proportion of the capacity is seen as providing flexibility…It confirms the direction of travel in some areas (especially EVs, storage and flexibility), but also highlights outstanding questions (such as for hydrogen, LDES and market design).

Also commenting was Energy Savings Trust, whose head of policy Stew Horne said:

“Crucially, alongside enabling renewables and storage technology, people must be actively engaged with the energy system and incentivised to use energy more flexibly. The success of the Demand Flexibility Service last winter shows that people are willing to change their everyday behaviour to reduce their own energy demand, in turn helping to deliver flexibility in energy demand on a large scale.

“But this must be sustained. As we’ve highlighted in our new research for the Climate Change Committee with Green Alliance, behaviour change campaigns and the provision of impartial advice seen around the world are empowering people to understand how to best manage their energy use and insulate their homes. They are proving successful in reducing energy demand.

“While the solutions outlined in the scenarios today raise questions over who pays, when, and how to ensure it’s fair for all, we do know that a clear, long-term plan is needed to create certainty for industry and consumers to enable the net zero transition. There are still opportunities for the UK Government to provide such clarity this year, not least in its Autumn Statement.”

Speaking on behalf of ESMIG, Europe’s smart energy provider organisation, in a Connect interview at Enlit Europe, Sellmann said there was happiness with the first draft of the European Union’s digitalisation strategy for a common energy data model or ‘data space’.

Drawing a parallel with the automotive sector data exchange Catena-X, she commented on its success saying that it had enabled new business models that wouldn’t be available otherwise.

“We believe with data standards that we share across the EU, we decrease boundaries as currently it is being done on an individual and country by country basis.”

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In this context regulators have an important role to play, as they do to support interoperability and other developments, Sellmann says, commenting on the presence of demand side flexibility in European legislation since 2019 but not yet being implemented in all countries.

As an example she says that in Germany she is unable as an end-user to access her consumption data, to benefit from flexible tariffs or to feed back excess PV generation to the grid.

Turning to the ongoing smart meter rollout across the EU, Sellmann said that the vendors are – and have been – ready to support it but again she highlights the need for a legislative push.

“The cost-benefit analysis, which ultimately comes down to the costs of deploying the technology, is one way to look at it but to make the energy transition happen means that we also need to look at all the business models we can actually leverage if we have a smart meter deployed.

“Yes, we need to look at interoperability and we need to have certain measures in place to scale via the European Union, but we need our legislators to support us in doing it.”

While there are challenges, such as the supply chain, this is in the process of being resolved.

“Smart meters are the foundation for visibility for the utility but also for end consumers for making the energy transition happen. To reach the 80% target by 2028 we need to move as we have a long way to go.”

Most energy insiders recognize that the transition to clean energy will require a large percentage of distributed energy resources (DER), particularly distributed solar PV, batteries, electric vehicles, grid-interactive buildings, and more. These DER will need to be dispatched as part of a system that asks them to both push energy to the grid and absorb it in order to keep the grid stable as it seeks to balance generation from large inverter-based resources, i.e. wind and solar power.

Today in the US there are grid operators and an energy market at the transmission level, but the distribution utilities have always focused on the (extremely complex) task of delivering energy that is reliable, safe, and affordable. In the future, that might need to change and the state of Maine is taking initial steps toward what that DER-heavy future might look like.

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In late June, Maine Governor Janet Mills signed legislation — LD 952: An Act to Create a 21^st-Century Electric Grid — that could modernize Maine’s electric grid.  

The bill directs the Governor’s Energy Office (GEO) to hire a third-party consultant to conduct a two-part study for the design of a distribution system operator (DSO) in Maine. A DSO would function in Maine much like the existing independent system operator of the New England region, ISO New England, whose role is electric grid operation, market administration and power system planning. 

Part one of the study evaluates whether it is possible to design a DSO in Maine to achieve a reduction in electricity costs for customers, improve electric system reliability and performance in the state and meet Maine’s climate goals and growth of distributed energy resources at an accelerated rate. If possible, and the GEO agrees, the consultant would then proceed to design the DSO. 

“LD 952 designs the future electricity grid Maine will need to achieve its climate goals, ensuring both cost efficiency and reliability for customers and the state’s economy,” said sponsor of the bill, Gerry Runte. “We are presently transitioning toward a smarter, digitalized grid that seamlessly incorporates local electricity sources. This transition was never anticipated by our current grid design, which has remained largely unchanged over the last 100 years.” 

The GEO will present an analysis based on the consultant’s DSO design to the Legislature by Jan. 1, 2025. Otherwise, if the consultant finds it is not possible to design a DSO meeting the required objectives stated above, the GEO will present part one of the consultant’s study to the Legislature within 60 days of the completion of part one of the study. 

“If Maine wants to achieve its climate goals and ensure that its distribution grids are as economical and as reliable as they can be, and if Maine wants its electric grid to serve its citizens and attract new business to the state, it needs to adopt a different perspective as to how its electricity delivery system operates, is controlled and regulated,” said Runte. “This is not a far-off vision – the technologies to implement a modern grid are readily available. What’s needed is a solid plan, the will to execute it and the willingness to become a leader in grid modernization.” 

The new law will go into effect 90 days after final adjournment of the legislative session.

This article was first published on the Power Grid website.

The two storylines proposed are for two so-called ‘deviation scenarios’, which are deviations from the ‘national trends’ scenarios that are in line with national energy and climate policies.

With the aim to reflect the latest developments in national policies that are in line with European greenhouse gas reduction ambitions as well as to acknowledge the need for high ambition in terms of energy efficiency and renewable energy deployment and explore different levels of energy and other independences for the EU, the scenarios cover a wide range of possible future evolutions of the energy infrastructure.

The two scenarios are ‘Distributed energy’ and ‘Global ambition’ reflecting respectively more European and global approaches.

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Broadly the ‘Distributed energy’ scenario pictures a pathway to achieving EU-27 carbon neutrality target by 2050 with higher European autonomy. The scenario is driven by a willingness of society to achieve high levels of independence in terms of energy supply and goods of strategic importance, e. g. industrial and agricultural produce.

It translates into both a behavioural shift and a strong decentralised drive towards decarbonisation through local initiatives by citizens, communities and businesses, supported by authorities.

Alternatively, the ‘Global ambition’ scenario pictures a pathway to achieving carbon neutrality by 2050, driven by a fast and global move towards the Paris Agreement targets.

It translates into the development of a very wide range of technologies, many being centralised, and the use of global energy trade as a tool to accelerate decarbonisation.

Scenario features

Features of the two scenarios are as follows.

Distributed energy scenario:

● The transition is initiated on local/national levels and aims for EU energy independence and strategic independence through maximisation of renewable energies and smart sector integration.
● Energy demand is reduced through circularity and better energy consumption behaviour and digitalisation is driven by prosumer and variable renewable energy management.
● There is a focus on decentralised technologies, i.e. PV, batteries, etc., and smart charging and on electric heat pumps and district heating. There is a higher share of electric vehicles, with e-liquids and biofuels supplementing for heavy transport, but minimal carbon capture and storage and nuclear.

Global ambition scenario:

● The transition is initiated on a European/international level with high EU renewable energy development supplemented with low carbon energy and diversified imports.
● Energy demand is reduced with priority given to decarbonisation and diversification of energy supply and digitalisation and automation reinforce the competitiveness of EU business.
● There is a focus on large scale technologies, i.e. offshore wind, utility storage, etc., and on a wide range of heating technologies, e. g. hybrid heating technology. There is a wide range of technologies and energy carriers across mobility sectors, viz electricity, hydrogen, e-liquids and biofuels, and the integration of nuclear and carbon capture and storage.

With this storyline report along with accompanying data published as a first deliverable in the formal process for TYNDP 2024 scenario building, feedback is now sought until 8 August 2023.

Taking into account the feedback, the draft TYNDP 2024 scenario report is expected to be published for consultation in late 2023 and finalised in 2024.