Charting a fresh course in the new energy landscape

31Jul

posted by: Darren Farrar, Schneider Electric

The face of the energy world is undergoing an immense sea change. We are already a far cry from the combustibles-reliant generation of only a few years ago.

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Greater environmental awareness is fuelling a widespread movement towards decarbonisation and clean energy sources. Distribution is also changing as consumers demand greater insight and control over their energy use.

The adoption of renewable energy and the rise of omnidirectional distribution means that our energy network is more decentralised than ever. In this new environment, grid operation becomes more complex, and resilience and reliability all-important. Faced with challenges such as severe weather events, value chain disruption and fluctuating power supply and price, many companies are seeking the latest technologies to improve energy security and responsiveness to future-proof operations.

Reliability re-examined

Reliability of power supply is a real – and growing – concern. A recent survey of 250 energy managers indicated that 25 per cent of companies experience regular power outages. These power disruptions can be costly: 18 per cent of responding companies had experienced an outage that cost the equivalent of £70,000 or more.

The key barrier to achieving reliable power supply is either an immature or aging grid. For instance, in India, where more than 240 million people still lack access to power, 50 per cent of electricity generation is wasted due to poor transmission to rural areas, as well as power theft. In the UK this may be seen by some as irrelevant due to our mature grid and regulated networks. However, the millions and millions pumped into asset replacement by the DNOs over the past 8 years have not increased the overall health of the UK’s distribution network and aging assets are still a major concern. On top of this our electricity network was designed many years ago to carry power in one direction from large coal plants in rural areas to population centres.

The key to the reliability problem is an integrated, active approach to energy management that enables resilience with its diversity of supply and demand. Active energy management is a holistic view of the strategies, data and resources needed to reduce consumption, drive innovation and maximise savings. Rather than treating the procurement, dispensation and evolution of energy as disparate activities, the Active Energy Management approach assumes that these activities are interdependent and indispensable.

The new approach to energy management

By addressing operational efficiency, enabled by digitisation and technology, operators can reduce susceptibility to outages and potential downtime. Strategically sourcing energy supply from a diverse portfolio that includes renewable generation reduces risk while maximising continuity. Investing in new energy opportunities and distributed energy resources (DERs) – like demand response, battery storage, smart grid technologies, fuel cells, combined heat and power, and distributed solar – can further the development of corporate assets that are responsive, agile, and reliable.

The result is both cost and carbon savings. Reductions in resource consumption from efficiency projects lower carbon emissions and the money saved can be used to fund sustainability projects. Once a cost centre, clean, green and renewable electricity is now cheaper than conventional generation in more than 60 countries, and will be the most inexpensive source of power everywhere by 2020. DERs continue to drive savings by allowing organisations to store power to use during peak load times and by reducing transmission utility charges.

A micro contribution to improved resilience

As more entities embark on the Active Energy Management journey and explore the flexibility of DERs, it is inevitable that there will be a growth in the deployment of microgrids to achieve grid autonomy. A self-contained, localised grid that typically includes a combination of generation and storage assets, microgrids can either integrate with existing grids or operate independently in “island mode”. This flexibility and reliance on DERs makes them the epitome of true energy resilience.

Microgrids can be used as stand-alone power generation sources – as they are in rural and off-grid electrification, or disconnected, remote geographies – or, as back-up power stations that ensure continuity of critical systems. And new financing models, such as microgrids-as-a-service, mean that companies can invest in a system without any upfront costs.

Despite the advantages of Active Energy Management and its role in improving reliability and resilience, implementation is still far behind corporate intentions. Whereas many companies are exploring the possible benefits of implementing programmes to improve energy efficiency, comparatively few are considering solutions to solve the resiliency challenge. Recognising and adapting to the revolution in energy, integrating renewable and clean sources of energy into the grid, could also be the solution to transforming our energy consumption habits and protecting our world as a whole.

About the author:

Darren Farrar has been a Customer Marketing Manager responsible for the Electrical Utility and Power Generation (Renewable and Thermal/Nuclear) sectors at Schneider Electric since 2011. He originally joined the company in 2006 following his graduation from the University of Huddersfield and holds a degree in Marketing with Innovation and an HNC in Electrical and Electronic Engineering. Darren is a keen advocate for renewable energy transformation and his professional interests focus on innovations in electrical switchgear and distribution infrastructure. He also is part of the National STEM Ambassador scheme and plays an active role encouraging young people to consider careers in engineering.