Monthly Archives: March 2015

The Resilience of the UK’s Electricity System

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Coincident with yesterday’s “Fuelling the Debate” report by the House of Commons Energy and Climate Change Select Committee, the House of Lords Science and Technology Select Committee published a report of their own, entitled “The Resilience of the Electricity System“. The Committee say in their overview of the report that:

The Government should not be congratulated on keeping the lights on. It is not acceptable for an advanced economy, hugely dependent on electricity, to sail so close to the wind. It found that we have been forced to generate extra capacity in the system, using expensive measures with heavy reliance on fossil fuel generation. The report urges the Government to improve its long-term planning to avoid squeezing the capacity margin like this.

The Chair of the Committee, Lord Selborne, commented that:

We chose to look at this issue because, such is our increasing reliance on electricity, any blackouts have the potential to bring our communications and vital services to a grinding halt.

The encouraging finding from our investigation is that overall, the resilience of the electricity system is robust, and witnesses told us we have the most reliable transmission network in Europe. But our report found that the Government sailed too close to the wind, allowing the capacity margin, its safety net, to be squeezed too tightly before taking last minute measures. Moreover these measures, which came at a cost to the taxpayer, were in conflict with the Government’s wider aims to decarbonise electricity generation.

We’re entering new and unchartered territory. As we strive for more decarbonised electricity provision, it will become harder and harder to keep electricity affordable and to guarantee security of supply. These are the three irreconcilable pressures of the ‘energy trilemma’, and we feel that there is more the Government needs to do to inform the public about potential higher prices.

We found that new technologies mean that our electricity system is undergoing immense and radical change. The report stresses that the Government must stay ahead of the game, with dedicated investment into research and development across a wide range of technologies, and constant alertness to cyber‑threats. Only then can the Government ensure that it can weather any storm, and continue to keep the lights on in the long‑term.

Delving deep into the report itself, chapter 5 concerns itself with “Changing demand”, and paragraph 143 even mentions vehicle to grid technology, albeit not using that name:

Electric vehicles and electric heat pumps are two technologies that are expected to increase demand for electricity.

If electric vehicles are widely taken up then they will increase electricity demand, though this could be concentrated during off peak hours. On the other hand, a smart grid could allow battery-powered electric vehicles to supply power to the grid, e.g. during peak times when prices are high, and then to recharge during off peak hours. They could also further contribute to electricity security by providing a backup supply during power outages. Electric vehicles are not the only low carbon option for road transport – hydrogen and biofuels (2nd or 3rd generation) also offer potential.

Paragraph 144  goes on to point out that:

Electrification of large parts of the energy used for heating or transport “would change its time-of-use profile, placing ever increasing pressures on the electricity system.” Charging electric vehicles will bring complexity and it will be important that vehicle
charging management systems and standards are carefully designed. Vehicle charging is a manageable problem, since the overnight load can be fitted into the available system capacity. However simplistic charging management solutions will create unfortunate effects, such as cliffs of coordinated switch-on and switch-off. There are other issues that need to be addressed in designing an effective charging system. Unmanaged systems will contribute significantly to peak load, since people naturally
plug in at the point of arrival home and then charge through the evening peak. It is therefore critical that carefully designed vehicle charging management systems and standards at the national level are developed and incorporated into any large scale demonstrations and early roll-outs. These systems need to address both the capacity of the national system and also the local distribution system.

Plenty of sensible suggestions then, which at the end of the day leaves us coming to much the same conclusion as the House of Lords Select Committee:

We recommend that the Government supports research, development, demonstration and early deployment across a diverse range of technologies. This should include electricity supply, demand side response, storage and smarter networks [and V2G!].
Particular attention should be paid to technologies that could strengthen electricity system resilience and how these technologies fit together in systems.

Given budgetary constraints, there will be a need to prioritise some technologies over others. We recommend that the rationale for these choices is clear, transparent and made publicly available.

Implementing that final sentence would certainly be a big improvement over the current state of affairs!

Fuelling the Debate About the UK’s Energy Future

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This morning the United Kingdom’s House of Commons Energy and Climate Change Select Committee published its latest report, entitled “Fuelling the debate: Committee successes and future challenges”. The introduction to the report states that:

The Energy and Climate Change Committee plays a central role in scrutinising and improving the Government’s policy and legislation.

We look in detail at three case studies – electricity market reform, competition in the energy market and shale gas – each of which highlights the key role we have played in holding the Government to account and improving policy and legislation. Finally, we set out our future vision for the UK energy system, based on the views and evidence provided by the wide range of stakeholders that we work with. We also explore the challenges which will need to be overcome in the next Parliament if the UK is to achieve its ambitious long-term climate and energy goals.

The committee has also just released a video summary of their activities over the last 5 years. Here it is:

In the video Tim Yeo, who is chair of the committee, says amongst other things that:

The cheapest form of energy is the energy we don’t use in the first place. Yet despite the fact that energy efficiency is one of the cheapest ways to cut greenhouse gas emissions and improve energy security and end fuel poverty, they were neglected in the Government’s original proposals. So the committee recommended that demand reduction and energy efficiency be placed at the very heart of Electricity Market Reform.

Unfortunately today the Government is still putting too much emphasis on building new electrical generating capacity, instead of promoting demand-side measures that would improve security of supply and also reduce consumer bills.

Here at V2G we cannot help but agree with those sentiments. We also cannot help but agree with Catherine Mitchell, Professor of Energy Policy at Exeter University, who according to a “Tweet” by the ECC select committee itself at least, pointed out this morning that:

 

Professor Mitchell’s slides for her presentation this morning can be downloaded from the IGov web site.

Utrecht Gets V2G Based Energy Storage

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In a ceremony at the Parkschool in the Lombok district of Utrecht on March 4th deputy Remco van Lunteren, officially opened the first Vehicle to Grid (V2G) energy storage system in Europe. The event was recorded for posterity:


The solar energy storage system supplied by Nissan charges electric cars but can also discharge their batteries in order to power houses. It helps to provide a higher return on solar power, reduces peak current on the grid and helps promote electric vehicles.  The opening of the V2G system is a sequel to the opening by Councillor Lot van Hooijdonk of a smart charging station from General Electric in Lombok on December 2nd 2014. The first charging station was unique because it had some built-in intelligence, and the V2G system adds an energy storage capability to it. Together, these are the first building blocks of Lombok’s Smart Solar Charging pilot project.

As the “Storage4all” project page puts it:

To create a truly smart grid using renewable energy, it is necessary to find a solution to the existing time differentials between generation and demand. The storage of energy is one way of achieving that.

Electric cars have a large storage capacity and are a major consumer of  future electric power generation. By making use of the storage facility of electric cars the “Smart Grid” can be made more sustainable.

In order to utilize the battery of an electric car for energy storage, it is necessary for the car batteries to be able to be discharged. In many cases this is not possible and the majority of EVs have internal protection against this. Only the Nissan LEAF currently has this possibility because of the Japanese market demand for storage (to protect against disruptions and power failures caused by earthquakes). The pilot project therefore initiated discussions with Nissan Europe and the provider of such a bi-directional charging system to achieve this in ​​Lombok.

Simulations show that there is much potential for storage of renewable energy in Smart Grids. Economically, it is not yet possible under current market conditions. The pilot project has ensured international recognition for this initiative, the development of the first European bi-directional charging station and a possible big roll out of them in Utrecht in the coming years.

Unfortunately market conditions here in the UK are currently also not economically favourable to this type of initiative.

Nissan and Endesa Pledge to Promote V2G in Europe

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Nissan and Spanish utility Endesa have announced in a press release that they

Signed a ground-breaking agreement at the 85th Geneva International Motor Show that paves the way for a mass-market vehicle-to-grid (V2G) system.

The two companies have pledged to work together to deliver a V2G system and an innovative business model designed to leverage this technology.

If that sounds a touch unlikely to you, here’s the proof:

The press release goes on to explain that:

The two companies have agreed to collaborate on the following activities:

  • Introduction of V2G services in the European market;
  • Exploring the use of ‘second life’ EV batteries for stationary applications (including households, buildings, grid);
  • Designing and evaluating potential affordable energy and mobility pack offers;

One of the main challenges for electricity management systems is to assure grid stability. This situation is especially relevant in countries with a high level of renewable energy generation, and this will only increase in the future. The longer term zero-emission vision is for EVs to be at the center of a fully integrated system whereby owners can participate in wholesale energy markets using the power stored in the batteries of their electric vehicles, and thus significantly reduce their cost of operation. In a not-so-distant scenario, the EV user not only decides when and where they want to charge their EV, but how best they spend and re-sell the energy stored in their EV; receiving tangible financial benefits in terms of energy savings, while at the same time maximizing the use of green energy.

As is customary on these occasions the press release quotes executives from the two companies. Paul Willcox, Chairman of Nissan Europe said that:

We believe this innovation represents a significant development for Nissan Leaf and e-NV200 customers. Every Nissan electric vehicle battery contains a power storage capability that will prove useful in contributing towards smarter and responsible management of the power demand & supply of local power grids, thus reducing our EV total cost of ownership. Not only does this represent an opportunity for Nissan’s EV private and fleet owners, it could also support grid stability and fully demonstrate that each Nissan EV represents a tangible social asset.

whereas Javier Uriarte, Head of Market Iberia at Endesa, pointed out that:

The flexibility offered by V2G implementation in terms of storing and releasing green energy into the grid will further enhance the already significant and tangible benefits of electric mobility. This is why Endesa, together with its parent company Enel and partner Nissan, have decided to join efforts in promoting this technology.

Moving on to the technology employed:

The Vehicle to Grid (V2G) system consists of the Endesa two-way charger and an energy management system that can also integrate such off-grid, and renewable, power generation as solar panels and wind turbines. Using this equipment, a Nissan LEAF or e-NV200 owner can connect to charge at low-demand, and cheap tariff periods, with an option to then use the electricity stored in the vehicle’s battery at home when costs are higher, or even feed back to the grid with a net financial benefit. Electricity generated by solar panels or wind turbines can be used to charge a vehicle, to power the home or business, or to feed back to the grid.

This unprecedented agreement between Nissan and Endesa means that European countries can now review their current energy management policies in order to respond to the technological innovation of the V2G system.

Endesa has developed the ultimate low-cost V2G technology ready for the mass market after years of real-life testing. The company first showcased its V2G technology in 2008 in Smartcity Malaga, the Enel Group testing ground for smart cities. Later on, in 2012, Endesa presented the evolution of such technology at the ZEM2ALL demonstrator.

On March 12, 2015, as the culmination of the V2G system development, together with Nissan as automotive partner, Endesa will host a full demonstration of the market-ready and low cost system in Madrid.

Of course we’re not content with merely reading press releases here at V2G UK, and we have conducted an in depth interview with Olivier Paturet, who is General Manager of Nissan Europe’s zero emission strategy. Here’s a 2013 recording of Olivier outlining the raison d’être of Nissan’s ZEV plans:


 

Watch this space!

Energy and Climate Change Committee Criticise Capacity Market

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The UK’s House of Commons Energy & Climate Change Select Committee issued a report today on the implementation of Electricity Market Reform which is highly critical of the new electricity capacity market. This may strike you (as it does me!) as a severe case of shutting the stable door after the horse has bolted, but nonetheless the executive summary puts it this way:

The Government’s flagship Electricity Market Reform was designed to drive investment in our energy infrastructure and manage the transition towards generating low-carbon, secure and cost-effective electricity. After years of planning, the Government has successfully put in place the necessary framework for the first Capacity Market and Contract-for-Difference (CfD) auctions under EMR, and DECC, National Grid and the Low Carbon Contracts Company have been helpful in preparing industry in the run-up to the auctions.

However, the speed at which participants have had to assimilate the complex policies have made it a challenging environment for smaller companies, and DECC is still failing to ensure that demand-side response (DSR) providers are given a level playing field in the Capacity Market. In order to avoid paying for more expensive generation capacity that may not be needed in the future, the Government should consider means to further support DSR in the Capacity market, for instance by increasing the contract length of DSR capacity agreements.

There also remain strong concerns around National Grid’s potential conflicts of interest as EMR Delivery Body, and it is important that clear steps are taken to ensure that it does not have an unfair commercial advantage in future Capacity Market auctions.

Speaking as one of those “smaller companies” it seems from our perspective that the playing field is indeed located on a rather steep slope! Tim Yeo, chairperson of the committee, said that:

Every consumer in the country is currently subsidising spare electricity generating capacity that may only be used for a few hours each year. But smart technology has now made it possible to reduce unnecessary electricity demand at peak times, thereby reducing the number of polluting power stations that need to be switched on. This could mean we can reduce the total electricity generating capacity that has to be maintained in future, bringing down costs for consumers while enabling us to reduce consumption of fossil fuels.

Yet this promising new demand-side response technology has been disadvantaged in the auctions under the Government’s Capacity Market – meaning costs and emissions could be higher than necessary. Only a fraction of the £1 billion pounds that will be spent keeping the lights on through the Capacity Market will actually provide new capacity and just 0.4% will go on demand-side response – with most of the rest going to existing fossil fuel power stations, paying some of them to stand idle for much of the year. Nearly a fifth of the capacity contracts already awarded are going to highly polluting coal power stations.

Which sums things up quite nicely for us. We would go even further than Tim Yeo. Not only should Demand Side Response be getting a better deal, so should distributed energy storage in general and V2x in particular. Tim does however also point out that:

The results of the first CfD auction for long term low-carbon contracts show that small companies or community energy projects are in danger of being shut out. The fact that the final strike prices were cheaper than the administrative price is a very positive result, but it casts further doubts over the value-for-money of the early contracts for renewables under the Levy Control Framework.

The committee’s concluding bullet points read as follows:

DECC’s upcoming review on EMR should focus hard on the issues voiced by stakeholders and raised in the Committee’s report. In particular, it should focus on:

  • The role of highly polluting coal and diesel fired power generation in the capacity market
  • How to facilitate cheaper and cleaner demand-side solutions to keep the lights on
  • How potential conflicts of interest with National Grid will be avoided or addressed
  • How engagement with small players can be improved

to which we would add one of our own:

How to design UK energy markets such that distributed storage and generation operate on a level playing field?