INDEPENDENT PUBLICATION BY raconteur.

net #0383 14 / 06 / 2016

POWERING
THE FUTURE
CLEAN AND GREEN 06
SMART GRID IS SET TO
08
DEVELOPING NATIONS
10
TURN DOWN DEMAND
02 GET DOWN TO BUSINESS
GET A LOT SMARTER LEAD CLEAN ENERGY TO BALANCE SUPPLY
The smart grid is being built No longer playing catch-up, they Demand-side response is
Future UK power increasingly looks green as businesses sign up and will soon be all around us are leading the clean revolution changing energy dynamics
02 POWERING THE FUTURE raconteur.net 14 / 06 / 2016 RACONTEUR RACONTEUR 14 / 06 / 2016 raconteur.net POWERING THE FUTURE 03

Kitson & Partners

POWERING
THE FUTURE
Clean and green
are now getting
DISTRIBUTED IN

down to business
RACONTEUR

PUBLISHING MANAGER HEAD OF PRODUCTION

Phillipus Putter Natalia Rosek

PRODUCTION EDITOR
DIGITAL CONTENT MANAGER
Sarah Allidina
UK power of the future increasingly looks green as the
Benjamin Chiou
DESIGN renewable energy sector gains backing from businesses
Samuele Motta
signing up to sustainable electricity generation
MANAGING EDITOR
Peter Archer Grant Chapman
Kellie Jerrard

OVERVIEW tor in a policy void, facing thou- 40,000 early-deaths in the UK a

CONTRIBUTORS
JIM M c CLELLAND sands more job losses. The 65 year, and more than 10 per cent
per cent cut to the feed-in tariffs of households in England are lan-

CELESTINE CHEONG
Freelance environment
communications
specialist, she writes
for a range of business
and environmental
publications.
FELICIA JACKSON
Editor at large of Cleantech
magazine and author of
Conquering Carbon,
she specialises in low-
carbon economy.
MIKE SCOTT
Freelance journalist,
specialising in
environment and business,
he writes for the Financial
Times, The Guardian and
2degrees Network.
B
SIÂN CRAMPSIE
Freelance journalist, usiness is good or so it
she covers technology, seems. Growth in renewa-
policy and business ble energy worldwide con-
developments in tinues to rocket, with the
the energy and REN21 Global Status Report record-
environment sectors. ing the largest annual increase in
power capacity as an additional 147
JIM McCLELLAND gigawatts went live in 2015.
Sustainable futurist, his
The megatrend is irresistible,
specialisms include built
says Assaad Razzouk, group chief
environment, corporate
social responsibility and executive and co-founder of Sindi-
ecosystem services. catum Sustainable Resources.
“Investments in renewables were
TIM SMEDLEY
Award-winning freelance
double the spend on new coal and
gas-fired power plants,” he says.
journalist, writing “We will be drowning in junk oil,
on employment and as electric vehicles and solar pur-
sustainability issues, he sue their inexorable advance.”
contributes to The Sunday At first glance, UK numbers seem
Times, The Guardian and
the Financial Times.
similarly conclusive, with govern-
ment figures for renewable elec-
tricity generation up 28.9 per cent.
However, not all fossil fuels had a
(FITs) last December also saw in-
stallation of small solar plummet
this spring.
Mired in delay and doubt, Hin-
kley Point C hangs in the balance
on the Somerset coast, while sup-
port for Tidal Lagoon Swansea Bay
ebbs away. In planning, onshore
wind and solar farms encounter
setbacks, but in a contrasting re-
For all the
excitement about
the deal in Paris,
it only scratches
the surface of CO2
emissions required –
there is much more
to be done
guishing in fuel poverty.
Given such mixed signals on pro-
gress towards a low-carbon econ-
omy, plus persistently low oil and
gas prices, there can be no room 01
for complacency in the clean ener-
gy sector, says Michael Liebreich,
01
founder of Bloomberg New Energy
Babcock Ranch in
Finance. “The scale of the chang- Florida is set to be
COP21 PARIS
es required is really daunting,” he the world’s first so- AGREEMENT
says. “For all the excitement about lar-powered town OBJECTIVES
the deal in Paris, it only scratch- when construction
es the surface of CO 2 emissions finishes next year
required – there is much more to The agreement, signed by
be done.”
At the Paris climate conference
02
UN dignitaries
including secretary
$285.9bn 195 countries at the 21st
Conference of the Parties
(COP21) in December, 195 countries
general Ban Ki
of new investment in
renewable power and fuels
of the United Nations
adopted the first-ever universal, Framework Convention on
legally binding global climate deal
Moon (centre) and
French president
was recorded in 2015 Climate Change (UNFCCC),
to limit global warming below 2C. François Hollande Source: Bloomberg
aims to strengthen the
Six months on from the talks, and (right) celebrate New Energy Finance/
Ren21 2016
global response to the threat
with G7 nations also pledging to the adoption of of climate change by:
end fossil-fuel subsidies by 2025, the global warming
the scales are tipping in the corpo- pact at the COP21

bad 2015. Both oil production (13.4
per cent) and natural gas (7.8 per
cent) were up, with only coal down
(27 per cent).
To muddy waters further, the
picture is changing. Government
pulling the funding plug last July
on its failed Green Deal flagship
left the struggling insulation sec-
versal of fortune, the first frack-
ing operation in England since the
shale ban lifted in 2012 won ap-
proval in North Yorkshire.
Meantime, citizen health and
wellbeing remain a concern, with
outdoor air pollution linked to
01
Climate Confer-
rate world. Limiting the increase
ence in Paris last
Mr Liebreich says: “For main-
December
the part of Heineken is also break- in the global average
stream business, Paris was the start ing new ground creating the first temperature to well below
of a process by which the global carbon-neutral large-scale brew- 2C above pre-industrial
clean energy transition switches ery in the world. Utilising excess levels and to pursue efforts
from unlikely scenario to base case heat from a local sawmill is taking to limit the
for long-term strategic planning.” the beer maker beyond what it has temperature
Business engagement made a done with wind turbines in the increase to 1.5C
big difference to COP21, argues Netherlands, biomass in Vietnam above pre-
and solar panels at Tadcaster. industrial levels.

Getty Images
Companies need to get creative
around carbon reduction, says
RENEWABLE ENERGY SHARE OF GLOBAL ELECTRICITY PRODUCTION 2015

3.7%
02
Wind Damian Ryan, head of inter-
national policy at The Climate
76.3% 2%
Group. “The agreement undoubt-
Non-renewables edly marked a major turning
Although this publication is funded through advertising and
sponsorship, all editorial is without bias and sponsored features Bio-power point,” he says. “Prior to Paris,
are clearly labelled. For an upcoming schedule, partnership in- over 400 major businesses had
made public commitments as
quiries or feedback, please call +44 (0)20 8616 7400 or e-mail
info@raconteur.net
16.6% 1.2% part of the We Mean Business
& Spencer is launching a unique
community-based ethical invest-
ment initiative.
In a first for community ener-
gy, the £2.65-million M&S Ener-
gy Society share offer will raise
capital to install, own and oper-
ate solar panels on the roofs of
collaborations pose challenges in
terms of risk and bring potential
co-benefits of protecting the envi-
ronment, involving customers and
commercial viability,” he says.
Changes to FITs mean the busi-
ness model must adapt, he adds.
“For corporate-community solar
Heineken’s global sustainable de-
velopment director Michael Dick-
stein. “We first look at our own
02 Increasing the ability
to adapt to the
adverse impacts of climate
operations, but to go one step fur- change, and
ther you have to think beyond the foster climate
perimeters of your own business,” resilience and
he says. “Mid to long term, the low greenhouse
environmental and economic op- gas emissions
portunities of renewable energy development.
exceed the operational challenges,
and can even become a competi-

Raconteur is a leading publisher of special-interest content Hydropower initiative. This groundswell of
Solar PV
and research. Its publications and articles cover a wide range support had a real impact and
of topics, including business, finance, sustainability, health- helped close the deal. The busi-
care, lifestyle and technology. Raconteur special reports are
published exclusively in The Times and The Sunday Times as well
23.7% 0.4% ness community now recognises
Renewable governments are moving from ne-
as online at raconteur.net
electricity Geothermal, gotiation to implementation.”
The information contained in this publication has been ob- concentrated
tained from sources the Proprietors believe to be correct. solar power To date, some 65 companies have
However, no legal liability can be accepted for any errors. No and ocean joined the RE100 initiative in com-
part of this publication may be reproduced without the prior mitting to sourcing 100 per cent of
consent of the Publisher. © Raconteur Media Source: REN21 2016 their electricity through renewa-
bles. Among that number, Marks
stores, with all profits distributed
locally via a dedicated community
benefit fund.
Such pioneering initiatives rep-
resent a test case for the UK mar-
ket and a learning experience
for all concerned, says M&S head
of Property Plan A and facilities
management Munish Datta. “Our
community solar initiative has
taught us that unusual, innovative
03
to succeed in the future, it needs to tive advantage.” Making finance
be financially self-sustaining and It is this mix of strategic vision flow consistent
formulaic,” says Mr Datta. “In the and market ambition that marks with a pathway towards low
next three years the price of solar out corporate leaders navigating greenhouse
is predicted to come down by 40 the future grand transition. For the gas emissions
per cent and installations could future of energy, it seems business and climate-
become 60 per cent lighter. These is good. resilient
developments and applying les- development.
sons learnt will make it easier for Share this article online via
community solar to succeed.” Raconteur.net Source: UNFCCC
At Göss in Austria, innovation on

BUSINESS CULTURE FINANCE HEALTHCARE LIFESTYLE SUSTAINABILITY TECHNOLOGY INFOGRAPHICS raconteur.net/powering-the-future-2016

02 POWERING THE FUTURE raconteur.net 14 / 06 / 2016 RACONTEUR RACONTEUR 14 / 06 / 2016 raconteur.net POWERING THE FUTURE 03

Kitson & Partners

POWERING
THE FUTURE
Clean and green
are now getting
DISTRIBUTED IN

down to business
RACONTEUR

PUBLISHING MANAGER HEAD OF PRODUCTION

Phillipus Putter Natalia Rosek

PRODUCTION EDITOR
DIGITAL CONTENT MANAGER
Sarah Allidina
UK power of the future increasingly looks green as the
Benjamin Chiou
DESIGN renewable energy sector gains backing from businesses
Samuele Motta
signing up to sustainable electricity generation
MANAGING EDITOR
Peter Archer Grant Chapman
Kellie Jerrard

OVERVIEW tor in a policy void, facing thou- 40,000 early-deaths in the UK a

CONTRIBUTORS
JIM M c CLELLAND sands more job losses. The 65 year, and more than 10 per cent
per cent cut to the feed-in tariffs of households in England are lan-

CELESTINE CHEONG
Freelance environment
communications
specialist, she writes
for a range of business
and environmental
publications.
FELICIA JACKSON
Editor at large of Cleantech
magazine and author of
Conquering Carbon,
she specialises in low-
carbon economy.
MIKE SCOTT
Freelance journalist,
specialising in
environment and business,
he writes for the Financial
Times, The Guardian and
2degrees Network.
B
SIÂN CRAMPSIE
Freelance journalist, usiness is good or so it
she covers technology, seems. Growth in renewa-
policy and business ble energy worldwide con-
developments in tinues to rocket, with the
the energy and REN21 Global Status Report record-
environment sectors. ing the largest annual increase in
power capacity as an additional 147
JIM McCLELLAND gigawatts went live in 2015.
Sustainable futurist, his
The megatrend is irresistible,
specialisms include built
says Assaad Razzouk, group chief
environment, corporate
social responsibility and executive and co-founder of Sindi-
ecosystem services. catum Sustainable Resources.
“Investments in renewables were
TIM SMEDLEY
Award-winning freelance
double the spend on new coal and
gas-fired power plants,” he says.
journalist, writing “We will be drowning in junk oil,
on employment and as electric vehicles and solar pur-
sustainability issues, he sue their inexorable advance.”
contributes to The Sunday At first glance, UK numbers seem
Times, The Guardian and
the Financial Times.
similarly conclusive, with govern-
ment figures for renewable elec-
tricity generation up 28.9 per cent.
However, not all fossil fuels had a
(FITs) last December also saw in-
stallation of small solar plummet
this spring.
Mired in delay and doubt, Hin-
kley Point C hangs in the balance
on the Somerset coast, while sup-
port for Tidal Lagoon Swansea Bay
ebbs away. In planning, onshore
wind and solar farms encounter
setbacks, but in a contrasting re-
For all the
excitement about
the deal in Paris,
it only scratches
the surface of CO2
emissions required –
there is much more
to be done
guishing in fuel poverty.
Given such mixed signals on pro-
gress towards a low-carbon econ-
omy, plus persistently low oil and
gas prices, there can be no room 01
for complacency in the clean ener-
gy sector, says Michael Liebreich,
01
founder of Bloomberg New Energy
Babcock Ranch in
Finance. “The scale of the chang- Florida is set to be
COP21 PARIS
es required is really daunting,” he the world’s first so- AGREEMENT
says. “For all the excitement about lar-powered town OBJECTIVES
the deal in Paris, it only scratch- when construction
es the surface of CO 2 emissions finishes next year
required – there is much more to The agreement, signed by
be done.”
At the Paris climate conference
02
UN dignitaries
including secretary
$285.9bn 195 countries at the 21st
Conference of the Parties
(COP21) in December, 195 countries
general Ban Ki
of new investment in
renewable power and fuels
of the United Nations
adopted the first-ever universal, Framework Convention on
legally binding global climate deal
Moon (centre) and
French president
was recorded in 2015 Climate Change (UNFCCC),
to limit global warming below 2C. François Hollande Source: Bloomberg
aims to strengthen the
Six months on from the talks, and (right) celebrate New Energy Finance/
Ren21 2016
global response to the threat
with G7 nations also pledging to the adoption of of climate change by:
end fossil-fuel subsidies by 2025, the global warming
the scales are tipping in the corpo- pact at the COP21

bad 2015. Both oil production (13.4
per cent) and natural gas (7.8 per
cent) were up, with only coal down
(27 per cent).
To muddy waters further, the
picture is changing. Government
pulling the funding plug last July
on its failed Green Deal flagship
left the struggling insulation sec-
versal of fortune, the first frack-
ing operation in England since the
shale ban lifted in 2012 won ap-
proval in North Yorkshire.
Meantime, citizen health and
wellbeing remain a concern, with
outdoor air pollution linked to
01
Climate Confer-
rate world. Limiting the increase
ence in Paris last
Mr Liebreich says: “For main-
December
the part of Heineken is also break- in the global average
stream business, Paris was the start ing new ground creating the first temperature to well below
of a process by which the global carbon-neutral large-scale brew- 2C above pre-industrial
clean energy transition switches ery in the world. Utilising excess levels and to pursue efforts
from unlikely scenario to base case heat from a local sawmill is taking to limit the
for long-term strategic planning.” the beer maker beyond what it has temperature
Business engagement made a done with wind turbines in the increase to 1.5C
big difference to COP21, argues Netherlands, biomass in Vietnam above pre-
and solar panels at Tadcaster. industrial levels.

Getty Images
Companies need to get creative
around carbon reduction, says
RENEWABLE ENERGY SHARE OF GLOBAL ELECTRICITY PRODUCTION 2015

3.7%
02
Wind Damian Ryan, head of inter-
national policy at The Climate
76.3% 2%
Group. “The agreement undoubt-
Non-renewables edly marked a major turning
Although this publication is funded through advertising and
sponsorship, all editorial is without bias and sponsored features Bio-power point,” he says. “Prior to Paris,
are clearly labelled. For an upcoming schedule, partnership in- over 400 major businesses had
made public commitments as
quiries or feedback, please call +44 (0)20 8616 7400 or e-mail
info@raconteur.net
16.6% 1.2% part of the We Mean Business
& Spencer is launching a unique
community-based ethical invest-
ment initiative.
In a first for community ener-
gy, the £2.65-million M&S Ener-
gy Society share offer will raise
capital to install, own and oper-
ate solar panels on the roofs of
collaborations pose challenges in
terms of risk and bring potential
co-benefits of protecting the envi-
ronment, involving customers and
commercial viability,” he says.
Changes to FITs mean the busi-
ness model must adapt, he adds.
“For corporate-community solar
Heineken’s global sustainable de-
velopment director Michael Dick-
stein. “We first look at our own
02 Increasing the ability
to adapt to the
adverse impacts of climate
operations, but to go one step fur- change, and
ther you have to think beyond the foster climate
perimeters of your own business,” resilience and
he says. “Mid to long term, the low greenhouse
environmental and economic op- gas emissions
portunities of renewable energy development.
exceed the operational challenges,
and can even become a competi-

Raconteur is a leading publisher of special-interest content Hydropower initiative. This groundswell of
Solar PV
and research. Its publications and articles cover a wide range support had a real impact and
of topics, including business, finance, sustainability, health- helped close the deal. The busi-
care, lifestyle and technology. Raconteur special reports are
published exclusively in The Times and The Sunday Times as well
23.7% 0.4% ness community now recognises
Renewable governments are moving from ne-
as online at raconteur.net
electricity Geothermal, gotiation to implementation.”
The information contained in this publication has been ob- concentrated
tained from sources the Proprietors believe to be correct. solar power To date, some 65 companies have
However, no legal liability can be accepted for any errors. No and ocean joined the RE100 initiative in com-
part of this publication may be reproduced without the prior mitting to sourcing 100 per cent of
consent of the Publisher. © Raconteur Media Source: REN21 2016 their electricity through renewa-
bles. Among that number, Marks
stores, with all profits distributed
locally via a dedicated community
benefit fund.
Such pioneering initiatives rep-
resent a test case for the UK mar-
ket and a learning experience
for all concerned, says M&S head
of Property Plan A and facilities
management Munish Datta. “Our
community solar initiative has
taught us that unusual, innovative
03
to succeed in the future, it needs to tive advantage.” Making finance
be financially self-sustaining and It is this mix of strategic vision flow consistent
formulaic,” says Mr Datta. “In the and market ambition that marks with a pathway towards low
next three years the price of solar out corporate leaders navigating greenhouse
is predicted to come down by 40 the future grand transition. For the gas emissions
per cent and installations could future of energy, it seems business and climate-
become 60 per cent lighter. These is good. resilient
developments and applying les- development.
sons learnt will make it easier for Share this article online via
community solar to succeed.” Raconteur.net Source: UNFCCC
At Göss in Austria, innovation on

BUSINESS CULTURE FINANCE HEALTHCARE LIFESTYLE SUSTAINABILITY TECHNOLOGY INFOGRAPHICS raconteur.net/powering-the-future-2016

04 POWERING THE FUTURE raconteur.net 14 / 06 / 2016 RACONTEUR RACONTEUR 14 / 06 / 2016 raconteur.net POWERING THE FUTURE 05

Shining bright in quest for cleaner energy...

The power sector is on the cusp of a technology breakthrough with a number of promising developments coming on stream

Enel
INNOVATION IN TECHNOLOGY and in Portugal by Principle Power. Several challenges remain, not least ogy, an important tool for reducing
SIÂN CRAMPSIE Statoil is planning a second demon- developing control strategies that greenhouse gas emissions.
stration project off the coast of Scot- combine HVDC’s fast, digital sys- Engineers at Fuel Cell Energy be-

A
concerted drive to solve
the challenges of the en-
ergy trilemma – energy
access, affordability and
sustainability – coupled with rapid
technological change have spurred
tech firms to debut novel and poten-
tially disruptive power technologies.
DNV GL highlighted the speed
of technological change across all
sectors of the global economy in the
latest version of Technology Out-
look 2025, its five-yearly “crystal
ball” report. Chief executive Remi
Eriksen notes in particular “a new
renaissance in industrial progress”,
with factors such as digitalisation
and advances in materials science
conspiring to create a perfect storm
of innovation.
Recent innovations are already
impacting the power sector, ena-
land, while the French government
has launched a tender for projects
demonstrating floating designs.
These projects will be essential for
the industry to gather data on op-
eration, as well as optimise designs
and cut costs.
According to the Carbon Trust,
floating wind could reach parity
with fixed foundation offshore wind
energy in the 2020s with the right
government support.
Thermal solar power is an emerg-
ing technology pioneered by firms
such as Abengoa. Globally there are
now more than 4.5GW of thermal
solar power plants installed, but
development into cost-reduction
is ongoing.
01 Researchers at Oregon State Uni-
versity (OSU) have demonstrated
in laboratory experiments that the
as electric vehicles and small- efficiency of solar thermal genera-
OXIS Energy
tems with the slower, analogue con-
trols of the AC grid.
Hybrid power plants enable energy
companies to combine two or more
generation technologies to enhance
efficiency, reduce emissions or im-
prove the reliability of power sup-
plies in remote, off-grid regions.
Pioneering projects include a
project in Australia combining so-
lar PV with pumped storage hy-
dropower and Morocco’s Ain Beni
Mathar plant, which combines solar
PV with gas-fired combined-cycle
technology.
More recently, Italy’s Enel inaugu-
rated the Stillwater power plant in
Nevada, which combines geother-
mal energy with solar PV and solar
thermal power generation. “The
lessons we are learning at this ad-
vanced geothermal-solar facility
will be key to the development of
lieve their fuel cells could be used
to extract carbon dioxide from
the exhaust stream of coal-fired
power plants.
Most carbon capture technologies
use a scrubber to absorb the car-
bon dioxide gas emitted from power
plants, but this is an energy-intensive
process. In Fuel Cell Energy’s process,
flue gas is fed to a molten carbonate
fuel cell, which concentrates and cap-
tures carbon dioxide as a side reaction
during power generation. The process
has the added benefits of removing
around 70 per cent of nitrous oxide
emissions and increasing the power
output of the fuel cell.
Fuel Cell Energy believes its
process offers a more economical
pathway for the commercial de-
velopment and application of car-
bon capture technology, and has
strengthened an existing partner-

bling the emergence of the “pro-
sumer”, energy consumers who
produce their own electricity, for
example. Today’s prosumers have
taken advantage of several technol-
ogies, such as solar photovoltaics
(PV), energy storage and smart me-
ters. According to DNV GL, in the
next decade we will increasingly
see advanced technologies being
combined or applied in novel ways
to make a difference to both energy
consumers and energy companies.
Large energy firms are already
taking advantage of one of the most
recent technology innovations – big
data – to create demand response
(DR) programmes.
This is not a new concept, but the
emergence of big data, smart me-
ters and sophisticated software has
enabled the development of novel
DR programmes that allow utilities
to curtail consumers’ loads at a mo-
ment’s notice.
Such programmes have brought a
new level of flexibility to the electro-
lyte grid at a time when renewable
generators are making the job of bal-
ancing supply and demand increas-
ingly difficult. While DR used to be
restricted to a few large, industrial
consumers, it can now be rolled out
to any customer and allows ener-
gy companies to reduce demand at
peak times.
The so-called “negawatt” has,
therefore, become a valuable com-
modity and driven the creation of
sophisticated behavioural DR pro-
grammes that encourage the active
participation of the consumer.
California-based Bidgely has pio-
neered behavioural DR, reporting
success in a recent trial in Australia,
where electricity consumers on av-
erage cut their load by more than 30
per cent at peak times.
Bidgely’s technology analyses ap-
pliance-specific energy use data and
scale renewables. tion can be improved and has won other hybrid plants throughout the ship with oil giant Exxon to refine
All eyes so far have been on Tesla’s funding from the US government to world,” says Enel chief executive the process further.
Powerwall, a small-scale lithium Floating turbines demonstrate its technology. Francesco Starace.
ion battery, but other battery tech-
are among the latest OSU’s research is focused on micro- Another combination of novel Share this article online via
nologies could offer better value in channel technology, which uses ex- technologies could help to reduce Raconteur.net
the long term. Developers of lithi- innovations and tremely small channels and a branch- the cost of carbon capture technol-
um sulfur batteries say theirs is the could open up new ing distribution system to speed the
technology of the future. areas to offshore energy transfer process. This has
Lithium-sulfur batteries have ad- been combined with supercritical
vantages over lithium ion products,
wind energy carbon dioxide as the heat-transfer CASE STUDY: WATLY
including a better energy density development fluid, instead of the molten salts com-
and depth of discharge, lower pro- around the world monly used in solar thermal plants.
02 jected costs – thanks in part to the The technology could open the door communities in developing
use of sulfur – and better safety. to a 15 per cent higher efficiency for nations, but the technology
UK-based OXIS Energy is commer- they also have to be flexible in their solar thermal technology, says OSU. could make an impact in any
01 employs gamification to incentivise cialising lithium sulfur batteries operation and have good speed of re- The European Solar Thermal Elec- region with good sunlight
Enel’s Stillwater customers with goals and rewards. and has teamed up with Anesco for a sponse if they are to deliver value,” tricity Association believes that solar levels, poor infrastructure,
plant, Nevada, From coal to nuclear and beyond, We’re also amongst the select
The technology has been likened to planned launch in the domestic and says Mr Spencer. Battery control sys- thermal electricity could meet up to and demand for water and
combines geother-
fitness apps such as Fitbit as it en- commercial markets this year. tems therefore have to be multi-lay- 6 per cent of the world’s electricity energy. Even US states such
we’ve been at the forefront of UK group of companies awarded
mal energy with
solar PV and solar courages changes in behaviour. But the batteries themselves are ered and integrated with scheduling needs by 2030. Cost-reductions could as California and Texas, where energy innovation for 125 years. the British Safety Council’s
thermal power Energy storage solutions can just part of the solution and there is and forecasting software used by expand the use of solar thermal be- water resources are stretched, Our historic world firsts include Sword of Honour, for our rigorous
generation the combustion plant for the first commitment to safety at work.
also add much needed flexibility much effort being put into the devel- grid operators and generators. They yond the world’s sun-belt regions. Hoping to prove the innovative are key potential markets.
02 to the grid, and domestic storage opment of sophisticated control sys- must also optimise charging, dis- High voltage direct current use of established technologies Watly has launched a commercial nuclear power station
OXIS Energy engi- technologies are becoming a tems for large-scale batteries, says charging and battery life. (HVDC) has become an important can improve access to energy, crowdfunding campaign to in 1956. The positive energy generated
neer preparing lith- disruptive force, revolutionising Dan Spencer of renewable energy This will be no easy feat, but will be element of power grids, particularly water and communications is raise $75 000, but this, says by our experience and passion is
ium-sulfur pouch
cells for their initial the way consumers use energy and consultancy firm OST Energy. an integral part of the energy storage for transporting large quantities of Marco Attisani, founder and Mr Attisani, is just a “social Our ongoing investment into R&D shared by major clients in more
discharge and enhancing the uptake of oth- “Batteries must work in conjunc- success story. power over long distances in India driving force behind Italian experiment”. The serious and low-carbon energy solutions than 30 countries worldwide. It’s
charge cycles er advanced technologies, such tion with the needs of the grid, and In the offshore wind energy sector, and China, for example. startup Watly. money for Watly’s development reflects our dedication to future also supported by the 43,000
floating turbines are among the lat- In Europe, HVDC is being used to The company is pioneering has come from a series of clean energy generation in the UK. strong global Doosan Group.
est innovations and could open up interconnect electricity grids across development of a thermal grants, including funds from
new areas to offshore wind energy borders and to transport wind ener- dynamic computer that the European Commission’s
PROJECTED POWER GENERATION CAPACITY To facilitate the skills essential Which all explains why our name
development around the world. gy generated offshore to mainland operates off-grid, using Horizon 2020 programme, and
BY ENERGY TYPE
Conventional offshore wind tur- grids. As it becomes more integrated the power of sunlight to the firm is currently attempting for a secure energy supply, ranks so powerfully in UK energy.
Clean energy Fossil fuels we’ve become one of the leading Past, present and future.
bines have foundations made of in the main alternating current (AC) purify water and provide to raise €10 million from
300 steel or concrete which fix them grid, the possibility of regional hy- paying customers with private investors. apprentice providers in the UK
to the sea bed. As developers take brid supergrids, combining AC and access to electricity and The technology has so far engineering sector, with the www.doosanbabcock.com
250 wind farms further offshore into DC (direct current) technologies, communications. been demonstrated in a pilot largest workforce of qualified
deeper waters, floating turbines has emerged. The Watly machine scheme in Ghana and the personnel.
offer the prospect of easier installa- Hybrid grids would enable the in- combines solar thermal, solar firm is launching its first pre-
200 tion and lower costs than those with tegration of large amounts of renew- photovoltaics and vapour industrial model in September.
fixed foundations. able energy capacity – for example, compression distillation Watly is already able to accept
150 Japan is a potential key market be- Europe’s planned offshore grid – technologies, and even has its pre-orders, says Mr Attisani,
cause of its deep waters and dense while combining the controllability own drone landing pad, offering and has a number of soft
coastal populations. Other target of DC systems with the flexibility of the possibility of a drone orders on the books. Full-scale
100 markets include the west coast AC networks. airport network to enhance demonstration projects could
of America, North Sea basin, and Recent breakthroughs in HVDC connectivity in remote regions. soon be operating in Nigeria,
50 coastal Atlantic regions in Europe technology, including ABB’s hybrid Obvious markets for Watly Jordan, the UAE and the
and North America. DC circuit breaker, and steadily ris- include remote or suburban United States.
2010 2015 2020 2025 2030
So far floating turbines have been ing HVDC capacities have brought
Source: New Climate Economy/Bloomberg New Energy Finance demonstrated in Norway by Statoil the prospect of hybrid grids closer.
04 POWERING THE FUTURE raconteur.net 14 / 06 / 2016 RACONTEUR RACONTEUR 14 / 06 / 2016 raconteur.net POWERING THE FUTURE 05

Shining bright in quest for cleaner energy...

The power sector is on the cusp of a technology breakthrough with a number of promising developments coming on stream

Enel
INNOVATION IN TECHNOLOGY and in Portugal by Principle Power. Several challenges remain, not least ogy, an important tool for reducing
SIÂN CRAMPSIE Statoil is planning a second demon- developing control strategies that greenhouse gas emissions.
stration project off the coast of Scot- combine HVDC’s fast, digital sys- Engineers at Fuel Cell Energy be-

A
concerted drive to solve
the challenges of the en-
ergy trilemma – energy
access, affordability and
sustainability – coupled with rapid
technological change have spurred
tech firms to debut novel and poten-
tially disruptive power technologies.
DNV GL highlighted the speed
of technological change across all
sectors of the global economy in the
latest version of Technology Out-
look 2025, its five-yearly “crystal
ball” report. Chief executive Remi
Eriksen notes in particular “a new
renaissance in industrial progress”,
with factors such as digitalisation
and advances in materials science
conspiring to create a perfect storm
of innovation.
Recent innovations are already
impacting the power sector, ena-
land, while the French government
has launched a tender for projects
demonstrating floating designs.
These projects will be essential for
the industry to gather data on op-
eration, as well as optimise designs
and cut costs.
According to the Carbon Trust,
floating wind could reach parity
with fixed foundation offshore wind
energy in the 2020s with the right
government support.
Thermal solar power is an emerg-
ing technology pioneered by firms
such as Abengoa. Globally there are
now more than 4.5GW of thermal
solar power plants installed, but
development into cost-reduction
is ongoing.
01 Researchers at Oregon State Uni-
versity (OSU) have demonstrated
in laboratory experiments that the
as electric vehicles and small- efficiency of solar thermal genera-
OXIS Energy
tems with the slower, analogue con-
trols of the AC grid.
Hybrid power plants enable energy
companies to combine two or more
generation technologies to enhance
efficiency, reduce emissions or im-
prove the reliability of power sup-
plies in remote, off-grid regions.
Pioneering projects include a
project in Australia combining so-
lar PV with pumped storage hy-
dropower and Morocco’s Ain Beni
Mathar plant, which combines solar
PV with gas-fired combined-cycle
technology.
More recently, Italy’s Enel inaugu-
rated the Stillwater power plant in
Nevada, which combines geother-
mal energy with solar PV and solar
thermal power generation. “The
lessons we are learning at this ad-
vanced geothermal-solar facility
will be key to the development of
lieve their fuel cells could be used
to extract carbon dioxide from
the exhaust stream of coal-fired
power plants.
Most carbon capture technologies
use a scrubber to absorb the car-
bon dioxide gas emitted from power
plants, but this is an energy-intensive
process. In Fuel Cell Energy’s process,
flue gas is fed to a molten carbonate
fuel cell, which concentrates and cap-
tures carbon dioxide as a side reaction
during power generation. The process
has the added benefits of removing
around 70 per cent of nitrous oxide
emissions and increasing the power
output of the fuel cell.
Fuel Cell Energy believes its
process offers a more economical
pathway for the commercial de-
velopment and application of car-
bon capture technology, and has
strengthened an existing partner-

bling the emergence of the “pro-
sumer”, energy consumers who
produce their own electricity, for
example. Today’s prosumers have
taken advantage of several technol-
ogies, such as solar photovoltaics
(PV), energy storage and smart me-
ters. According to DNV GL, in the
next decade we will increasingly
see advanced technologies being
combined or applied in novel ways
to make a difference to both energy
consumers and energy companies.
Large energy firms are already
taking advantage of one of the most
recent technology innovations – big
data – to create demand response
(DR) programmes.
This is not a new concept, but the
emergence of big data, smart me-
ters and sophisticated software has
enabled the development of novel
DR programmes that allow utilities
to curtail consumers’ loads at a mo-
ment’s notice.
Such programmes have brought a
new level of flexibility to the electro-
lyte grid at a time when renewable
generators are making the job of bal-
ancing supply and demand increas-
ingly difficult. While DR used to be
restricted to a few large, industrial
consumers, it can now be rolled out
to any customer and allows ener-
gy companies to reduce demand at
peak times.
The so-called “negawatt” has,
therefore, become a valuable com-
modity and driven the creation of
sophisticated behavioural DR pro-
grammes that encourage the active
participation of the consumer.
California-based Bidgely has pio-
neered behavioural DR, reporting
success in a recent trial in Australia,
where electricity consumers on av-
erage cut their load by more than 30
per cent at peak times.
Bidgely’s technology analyses ap-
pliance-specific energy use data and
scale renewables. tion can be improved and has won other hybrid plants throughout the ship with oil giant Exxon to refine
All eyes so far have been on Tesla’s funding from the US government to world,” says Enel chief executive the process further.
Powerwall, a small-scale lithium Floating turbines demonstrate its technology. Francesco Starace.
ion battery, but other battery tech-
are among the latest OSU’s research is focused on micro- Another combination of novel Share this article online via
nologies could offer better value in channel technology, which uses ex- technologies could help to reduce Raconteur.net
the long term. Developers of lithi- innovations and tremely small channels and a branch- the cost of carbon capture technol-
um sulfur batteries say theirs is the could open up new ing distribution system to speed the
technology of the future. areas to offshore energy transfer process. This has
Lithium-sulfur batteries have ad- been combined with supercritical
vantages over lithium ion products,
wind energy carbon dioxide as the heat-transfer CASE STUDY: WATLY
including a better energy density development fluid, instead of the molten salts com-
and depth of discharge, lower pro- around the world monly used in solar thermal plants.
02 jected costs – thanks in part to the The technology could open the door communities in developing
use of sulfur – and better safety. to a 15 per cent higher efficiency for nations, but the technology
UK-based OXIS Energy is commer- they also have to be flexible in their solar thermal technology, says OSU. could make an impact in any
01 employs gamification to incentivise cialising lithium sulfur batteries operation and have good speed of re- The European Solar Thermal Elec- region with good sunlight
Enel’s Stillwater customers with goals and rewards. and has teamed up with Anesco for a sponse if they are to deliver value,” tricity Association believes that solar levels, poor infrastructure,
plant, Nevada, From coal to nuclear and beyond, We’re also amongst the select
The technology has been likened to planned launch in the domestic and says Mr Spencer. Battery control sys- thermal electricity could meet up to and demand for water and
combines geother-
fitness apps such as Fitbit as it en- commercial markets this year. tems therefore have to be multi-lay- 6 per cent of the world’s electricity energy. Even US states such
we’ve been at the forefront of UK group of companies awarded
mal energy with
solar PV and solar courages changes in behaviour. But the batteries themselves are ered and integrated with scheduling needs by 2030. Cost-reductions could as California and Texas, where energy innovation for 125 years. the British Safety Council’s
thermal power Energy storage solutions can just part of the solution and there is and forecasting software used by expand the use of solar thermal be- water resources are stretched, Our historic world firsts include Sword of Honour, for our rigorous
generation the combustion plant for the first commitment to safety at work.
also add much needed flexibility much effort being put into the devel- grid operators and generators. They yond the world’s sun-belt regions. Hoping to prove the innovative are key potential markets.
02 to the grid, and domestic storage opment of sophisticated control sys- must also optimise charging, dis- High voltage direct current use of established technologies Watly has launched a commercial nuclear power station
OXIS Energy engi- technologies are becoming a tems for large-scale batteries, says charging and battery life. (HVDC) has become an important can improve access to energy, crowdfunding campaign to in 1956. The positive energy generated
neer preparing lith- disruptive force, revolutionising Dan Spencer of renewable energy This will be no easy feat, but will be element of power grids, particularly water and communications is raise $75 000, but this, says by our experience and passion is
ium-sulfur pouch
cells for their initial the way consumers use energy and consultancy firm OST Energy. an integral part of the energy storage for transporting large quantities of Marco Attisani, founder and Mr Attisani, is just a “social Our ongoing investment into R&D shared by major clients in more
discharge and enhancing the uptake of oth- “Batteries must work in conjunc- success story. power over long distances in India driving force behind Italian experiment”. The serious and low-carbon energy solutions than 30 countries worldwide. It’s
charge cycles er advanced technologies, such tion with the needs of the grid, and In the offshore wind energy sector, and China, for example. startup Watly. money for Watly’s development reflects our dedication to future also supported by the 43,000
floating turbines are among the lat- In Europe, HVDC is being used to The company is pioneering has come from a series of clean energy generation in the UK. strong global Doosan Group.
est innovations and could open up interconnect electricity grids across development of a thermal grants, including funds from
new areas to offshore wind energy borders and to transport wind ener- dynamic computer that the European Commission’s
PROJECTED POWER GENERATION CAPACITY To facilitate the skills essential Which all explains why our name
development around the world. gy generated offshore to mainland operates off-grid, using Horizon 2020 programme, and
BY ENERGY TYPE
Conventional offshore wind tur- grids. As it becomes more integrated the power of sunlight to the firm is currently attempting for a secure energy supply, ranks so powerfully in UK energy.
Clean energy Fossil fuels we’ve become one of the leading Past, present and future.
bines have foundations made of in the main alternating current (AC) purify water and provide to raise €10 million from
300 steel or concrete which fix them grid, the possibility of regional hy- paying customers with private investors. apprentice providers in the UK
to the sea bed. As developers take brid supergrids, combining AC and access to electricity and The technology has so far engineering sector, with the www.doosanbabcock.com
250 wind farms further offshore into DC (direct current) technologies, communications. been demonstrated in a pilot largest workforce of qualified
deeper waters, floating turbines has emerged. The Watly machine scheme in Ghana and the personnel.
offer the prospect of easier installa- Hybrid grids would enable the in- combines solar thermal, solar firm is launching its first pre-
200 tion and lower costs than those with tegration of large amounts of renew- photovoltaics and vapour industrial model in September.
fixed foundations. able energy capacity – for example, compression distillation Watly is already able to accept
150 Japan is a potential key market be- Europe’s planned offshore grid – technologies, and even has its pre-orders, says Mr Attisani,
cause of its deep waters and dense while combining the controllability own drone landing pad, offering and has a number of soft
coastal populations. Other target of DC systems with the flexibility of the possibility of a drone orders on the books. Full-scale
100 markets include the west coast AC networks. airport network to enhance demonstration projects could
of America, North Sea basin, and Recent breakthroughs in HVDC connectivity in remote regions. soon be operating in Nigeria,
50 coastal Atlantic regions in Europe technology, including ABB’s hybrid Obvious markets for Watly Jordan, the UAE and the
and North America. DC circuit breaker, and steadily ris- include remote or suburban United States.
2010 2015 2020 2025 2030
So far floating turbines have been ing HVDC capacities have brought
Source: New Climate Economy/Bloomberg New Energy Finance demonstrated in Norway by Statoil the prospect of hybrid grids closer.
06 POWERING THE FUTURE raconteur.net 14 / 06 / 2016 RACONTEUR RACONTEUR xx xx / 2016
14 / 06 xxxx raconteur.net XXXX
POWERING THE FUTURE 2
07

COMMERCIAL FEATURE

The smart grid is set to get a lot smarter ENERGY MANAGEMENT IN A SMART WORLD
The smart grid is being built bit by bit – it may not arrive with a bang, but one day soon it will be all around us Distributed energy and technology-led innovation are changing the shape of the energy industry as consumers around the
world demand more from their usage

SMART GRID
MIKE SCOTT

It is sitting quietly

T
BULK GENERATION STORAGE
waiting for the

he smart grid used to be
the future of electricity –
it was going to create an
interactive, decentralised
world of “prosumers” who sell their
surplus energy as well as buy from
the power network.
At first, it just meant putting in
smart meters, says John Renard,
global lead for utilities at consul-
tancy Cyient. “However, it has also
come to represent the installation of
distributed energy resources across
a network, as well as the presence
of self-healing grids, which organ-
ise disaster recovery and promote
network optimisation within a net-
work,” he says.
Then, like all buzzwords, it seemed
to just fade away. So what happened?
Well, partly, bits of the smart grid
morphed into other, trendier con-
cepts, such as the internet of things,
the idea that all devices and appli-
ances in the home will be part of a
giant network.
“The rollout of the internet of
things in the home and the ‘smart
home’ is finally starting to make trac-
tion with consumers,” says Marlon
Cohen, a technology lawyer at Ad-
dleshaw Goddard. “UK retailers like
Dixons Carphone and John Lewis are
focusing on smart home technology.
This uptake of connected home prod-
ucts, from fridges to real-time energy
displays, will in turn drive the uptake
of smart products such as smart me-
ters on the supply side.”
Partly, it is sitting quietly waiting
for the infrastructure it needs, like
smart meters, to be put in place.
“Things have moved on,” says Stu-
art Cook, head of utility strategy
and regulation at PwC, “but it’s a
bit like a smartphone. It’s no good
having the phone if you don’t have
all the infrastructure as well. The
smart grid is a bit like that. There
is increasing deployment of smart
technology in the grid estate, but it’s
patchy at the moment.”
NEW ENTRANTS
New entrants providing new
services to end-customers
and existing participants
DISTRIBUTION
Increased levels of
innovation, visibility,
automation and control
TRANSMISSION
Demand management
and storage become
key to system
balancing
Customer demand managed
contracts for direct control
By 2020, UK electricity suppliers
have to rollout smart meters that
enable the customer to know, at any
point in time, how much power is
being used. These will combine with
smart appliances to allow a dialogue
between the household and the en-
ergy supplier so that during times of
peak demand, when energy is more
expensive, the meter can tell the ap-
pliance to power down.
But other parts of the smart grid
have simply, but quietly, became part
of the mainstream. Companies such
as Tollgrade, for example, have cre-
Tollgrade
Large-scale intermittent Increased use of distributed
and renewable facilities and grid-connected storage
replacing carbon-
intensive capacity
SMART GRID
DEMAND RESPONSE
through pricing and
ated monitoring platforms made up
of smart grid sensors and predictive
grid analytics software that give util-
ities and distribution system opera-
tors a real-time map of what is hap-
pening on the network. Such systems
enable grid operators to identify
potential faults before they happen,
saving money for operators and re-
ducing power outages for customers.
Meanwhile, the UK power system
is in the process of a radical transfor-
mation that has the smart grid at its
heart. Ageing coal-fired and nuclear
power stations are closing down and
large amounts of renewable power
are coming on to the system as the
cost of technologies such as wind
to balance the system and
manage the grid
RETAIL
High levels of customer
interaction and data-driven
products and services
DISTRIBUTED
GENERATION
Customers increasingly
becoming producers
CUSTOMER
Conscious, engaged
and actively seeking
the best deal
MICROGRIDS
Increasing numbers of
off-grid communities,
campuses and businesses Source: PwC
tors and bringing new players into
the market. A number of companies,
such as Smartest Energy and KiWi
Power, have set themselves up as
aggregators. KiWi Power groups to-
gether industrial and commercial
companies prepared to cut their
power usage at peak times, allowing
system operators such as National
Grid UK to avoid using outdated,
expensive and polluting “peaking”
power stations.
Smartest Energy, by contrast, buys
energy from independently owned,
largely renewable power generators
and supplies it to large businesses
such as Marks & Spencer, John Lew-
is and Toyota. A growing number of
infrastructure it
needs, like smart
meters, to be put
in place
the most exciting thing. The tech-
nology is low risk and it is quick to
deploy. The marginal cost is far
cheaper than anything else. But the
challenge is to incentivise consum-
ers to change the way they behave.”
For the smart grid to be a more co-
herent phenomenon, it will require
some kind of consumer trigger, Mr
Reid agrees, but it is not yet clear
exactly what that will be. “Electric
vehicles (EVs) could be one trigger.
If there is a significant uptake of EVs,
immediately people have an asset
that could provide vehicle-to-grid
power. That will lead them to think
about saving energy in the house,
which will lead to people coming
forward with aggregation services,
which will lead to more progressive
thinking about energy storage. It will
be a cascade effect that the industry
will have to keep up with,” he says.
Another area that needs to keep up
is regulation, which at the moment
is lagging behind the technological
advances the industry is seeing.
“There are quite a few regulatory
barriers at the moment,” says Si-
mon Virley, UK chairman of energy
at KPMG and a former director gen-
eral at the Department of Energy
and Climate Change. One example
of this is that storage is treated as a
generation technology. Under rules
that prevent National Grid from
generating power, it is not allowed
to support energy storage technolo-
gies. “I suspect that it is the technol-
ogy that will drive this, rather than
the regulation,” he adds.
On the supply side, the rollout of
smart grid solutions is taking place
in different ways in different cities in
the UK, and a regional rollout is like-
ly to continue, says Mr Cohen. For
example, Bristol started running the
T
he face of energy is
changing. An explosion of
groundbreaking developments
in technology is changing the way
consumers approach their energy
consumption. Long gone is the
passive consumer of yesterday –
today’s consumer is demanding
choice, control and the option to
use less energy.
A heady combination of
distributed generation, smart
technologies and the growth
of renewables is creating a
fundamental shift in the market,
opening up new opportunities for
energy suppliers.
Speaking at the 2016 World
Summit on Innovation and
Entrepreneurship in New York,
Jorge Pikunic, managing director
of Centrica’s Global Distributed
Energy and Power business, said:
“We’re at the forefront of a new
energy world with intelligent
appliances, demand-side response
and smarter grids that mean
customers now have much greater
ability to control how much energy
they use and when they use it.”
It is a trend that Centrica is
seeking to embrace. In 2015, the
company established the distributed
energy and power business with
the aim of helping large users take
control of their energy usage.
A typical business could
expect to see a potential
saving of up to 15 per
cent off their bills
“We want to help customers to
turn their energy into an opportunity,
whether that is to reduce costs,
improve their site resilience or
reduce their carbon emissions.
What this means in practice is that
large energy users such as hospitals
It is an approach that Mr Pikunic
likens to a shared economy. In
the future individuals may be
asked to switch off their energy
consumption for short periods
of time. The effect of collective
action can have the same impact
as a large power station switching
on, only more sustainably and
potentially cheaper.
It is not only the amount of energy
consumed that is fast changing
in today’s world, but the location
of energy supplies. Increasingly,
energy will be generated closer
to the point of consumption and
the industry is responding to the
emergence of local energy systems
and micro-grids.
A recent study by the World
Economic Forum showed that
58 per cent of the 687 US
organisations surveyed planned to
have at least one facility operate
off the grid within the next
ten years.
Centrica is working with its
customers to provide a package
of solutions to both enhance
and upgrade their energy assets,
including the use of energy storage
01 and on-site generation such as
combined heat and power (CHP)
and renewable technologies.
01
Wrexham With businesses responsible for
Council’s solar nearly half of UK emissions, the
farm, designed opportunity for large energy users
by Centrica to to contribute to decarbonisation is
generate enough a factor that can’t be ignored.
power for 700
homes a year
According to Mr Pikunic,
distributed energy also has the
potential to accelerate access
02
Jorge Pikunic to energy for millions of people
speaking at the worldwide. In 2013, it was
World Summit on
Innovation and
estimated that a staggering 17
Entrepreneurship per cent of the global population
last month did not have access to electricity,
but distributed energy offers
the opportunity to leapfrog the
cost of central generation and
grid systems to create greater
availability. A central power station
and grid system would take years
to build; in contrast a solar farm

and solar continue to drop rapidly.
As energy storage techniques and
technologies continue to mature and
get cheaper, this new wave of decen-
tralised energy will continue to grow.
“The smart grid means moving
from a centralised power distribu-
tion system with generators pump-
ing energy out, to a system where
energy is distributed around the
country and is being stored or pro-
duced when needed,” says Stewart
Reid, future networks and innova-
tion manager at Scottish and South-
ern Energy Power Distribution.
This is shaking up the power gen-
eration sector, threatening the busi-
Installation of Tollgrade smart grid sensors to monitor power flows ness models of the “big six” genera-
big companies are committing to
source all their power from renew-
able energy under projects such as
The Climate Group’s RE100 initia-
tive, so the market is likely to contin-
ue to grow rapidly. A number of com-
panies are also starting to generate
$120bn their own energy by putting solar
panels on the roofs of their facilities
estimated or by turning food waste into biogas.
value of the About £1 billion has been invested
global smart
in distributed energy over the last
grid market by
2020, up from five years, £375 billion of it in 2015
$40 billion alone, says Robert Groves, chief ex-
in 2014 ecutive of Smartest Energy. “If we
are going to move to a smart world,
Source:
Zion Research the first step is to have local gener-
2016 ation. Demand-side management is
Bristol Smart Energy City Collabora-
tion in 2015 where a city-owned ener-
gy company takes responsibility for
smart use, distribution and supply of
energy across Bristol.
Milton Keynes on the other hand
has looked at introducing internet
of things technology in the city to
monitor energy, waste collection
and water systems. This type of re-
gional development is likely to con-
tinue alongside government-led ini-
tiatives such as the smart metering
implementation programme.
Share this article online via
Raconteur.net
or manufacturers can take a more
proactive approach to their energy
use and make it work harder for
them, both from an economic
standpoint and from a carbon point
of view,” says Mr Pikunic.
The rapid advancements in
technology are proving vital in
unlocking sustainability, cost-
efficiencies and reliability for large
energy users and businesses, he says.
Innovation is key and in a world
where consumers have come to
expect a personalised service, it
is inevitable they don’t just want
value for money, but desire their
supply and services to be uniquely
tailored to their needs and nuances.
02
Gaining visibility into real-
time electricity usage is the first
step in the distributed energy
journey. Centrica’s customers
can achieve this through its
pioneering Panoramic Power
solution, which combines wireless
sensor technology and cloud-
based analytics to provide valuable
insights and statistical analysis on
their energy usage.
Having access to complete data,
right down to the individual pieces
of equipment, allows customers to
identify maintenance, operations
and energy opportunities right
across their business footprint.
“If you can’t measure it, then
you can’t manage it. Big data and
analytics give suppliers the ability
to extract meaningful insights
for their customers that can lead
to beneficial changes to their
behaviour,” says Mr Pikunic.
“For many customers, the first
action following that insight is the
installation of new energy efficiency
measures. A typical business could
expect to see a potential saving of
up to 15 per cent off their bills.”
It doesn’t stop there. The
advent of digitisation can also
bring opportunities for businesses
to harness the flexibility of their
assets, using demand-side response
to access new revenue streams.
The principle is for consumers
to connect their on-site energy
infrastructure up to a central
energy control centre and use
Centrica’s in-house trading experts
to get value from them, often by
simply turning assets down or off
for short periods of time with no
impact on their operations.
takes just days or weeks.
Mr Pikunic concludes:
“Distributed energy is economic
today and will become even more
so. Smart meters and technologies
are key in allowing consumers to
become more actively engaged in
reducing and flexing their demand.
“What we are witnessing is the
democratisation of energy, from
a handful of players to tens of
thousands of large energy users and
millions of households and small
companies that will play a vital role
in tomorrow’s energy market.”
For more information please visit
centrica.com/takecontrol
RACONTEUR xx xx / 2016
14 / 06 xxxx raconteur.net XXXX
POWERING THE FUTURE 2
07

COMMERCIAL FEATURE

ENERGY MANAGEMENT IN A SMART WORLD

Distributed energy and technology-led innovation are changing the shape of the energy industry, as consumers around the
world demand more from their usage

T
he face of energy is changing.
An explosion of ground-
breaking developments in
technology is changing the way
consumers approach their energy
consumption. Long gone is the
‘passive consumer’ of yesterday,
today’s consumer is demanding
choice, control and the option to
use less energy.
A heady combination of
changing customer attitudes,
smart technologies and the
growth of renewables is creating
a fundamental shift in the market
and opening up new opportunities
for energy suppliers.
Speaking at the 2016 World
Summit on Innovation and
Entrepreneurship in New York,
Jorge Pikunic, managing director
of Centrica’s global Distributed
Energy & Power business, said:
“We’re at the forefront of a new
energy world with intelligent
appliances, demand-side response
and smarter grids that mean
customers now have much greater
ability to control how much energy
they use and when they use it.”
It is a trend which Centrica
is seeking to embrace. In 2015,
the company established the
Distributed Energy & Power
business with the aim of helping
large users take control of their
energy usage.
Large energy users can
take a more proactive
approach to their
energy use
“We want to help customers
to turn their energy into an
opportunity, whether that be to
reduce costs, improve their site
resilience or reduce their carbon
emissions. What this means in
practice is that large energy users
such as hospitals or manufacturers
can take a more proactive approach
to their energy use and make it
work harder for them,” says Pikunic.
For Pikunic, the rapid
advancements in technology
are proving vital in unlocking
sustainability, cost efficiencies and
reliability for large energy users
and businesses.
Innovation is key; and in a world
where consumers have come to
expect a personalised service, it is
inevitable that they don’t just want
value for money, but desire their
supply and services to be uniquely
tailored to their needs and nuances.
01
02
Gaining visibility into real-
time electricity usage is the first
step in the distributed energy
journey. Centrica’s customers
can achieve this through its
pioneering Panoramic Power
solution, which combines wireless
sensor technology and cloud-
based analytics to provide valuable
insights and statistical analysis on
their energy usage.
Having access to complete data,
right down to the individual pieces
of equipment, allows customers to
identify maintenance, operations
and energy opportunities right
across their business footprint.
“If you can’t measure it, then
you can’t manage it. Big data
and analytics give suppliers the
ability to extract meaningful
insights for their customers that
can lead to beneficial changes to
their behaviour.
“For many customers, the first
action following that insight is the
installation of new energy efficiency
measures,” explains Pikunic.
But it doesn’t stop there. The
advent of digitisation can also
bring opportunities for businesses
to harness the flexibility of their
assets, using demand side response
to access new revenue streams.
01
Wrexham
Council’s solar
farm, designed
by Centrica to
generate enough
power for 700
homes a year
02
Jorge Pikunic
speaking at the
World Summit on
Innovation and
Entrepreneurship
last month
It is an approach that Pikunic
likens to a shared economy; in
the future individuals could opt to
reduce their energy consumption
for short periods of time. The
effect of collective action can have
the same impact as a large power
station switching on, only more
sustainably and potentially cheaper.
It is not only the amount of energy
consumed that is fast changing in
today’s world, but the location of
energy. Increasingly, energy will
be generated closer to the point
of consumption and the industry is
responding to the emergence of local
energy systems and micro-grids.
A recent study by WEF showed
that 58% of the 687 US organisations
surveyed planned to have at least one
facility operate off the grid within the
next 10 years.
Centrica is working with its
customers to provide a package of
solutions to both enhance and upgrade
their energy assets, including the use of
energy storage and onsite generation
such as combined heat and power
(CHP) and renewable technologies.
With businesses responsible for
nearly half of UK emissions, the
opportunity for large energy users
to contribute to decarbonisation is
a factor that can’t be ignored.
Distributed energy also has the
potential to accelerate access
to energy for millions of people
worldwide. In 2013 it was estimated
that a staggering 17% of the global
population did not have access to
electricity, but distributed energy
offers the opportunity to leapfrog
the cost of central generation and
grid systems to create greater
availability. A central power station
and grid system would take years
to build; in contrast a solar farm
would take just days or weeks.
Pikunic concludes: “What we are
witnessing is the democratisation
of energy, from a handful of
players to tens of thousands of
large energy users and millions of
households and small companies
that will play a vital role in
tomorrow’s energy market.”
For more information please visit
centrica.com/takecontrol
08 POWERING THE FUTURE raconteur.net 14 / 06 / 2016 RACONTEUR RACONTEUR 14 / 06 / 2016 raconteur.net POWERING THE FUTURE 09

Developing countries take the lead in clean energy market

The West may have begun the clean energy revolution, but developing countries are no longer playing catch-up – in fact, they are now leading the way as an example to the rest of the world

GREEN INVESTMENT ANTICIPATED GROWTH OF GLOBAL POWER DEMAND, 2012-30 CURRENT/PROJECTED POPULATIONS WITHOUT for opportunities. The big European Efeler geothermal plant in Turkey
TIM SMEDLEY AFRICA AND ASIA ARE PREDICTED TO SEE THE STRONGEST INCREASE ACCESS TO ELECTRICITY (M) projects, such as Germany’s Energie- also received $200 million from
SUB-SAHARAN AFRICA IS THE ONLY REGION IN DEVELOPING AND wende, may have driven the growth the European Bank for Reconstruc-

R
enewable energy used to be
deemed unaffordable for
developing countries. Wind
and solar were rich country
luxuries, while third world economies
could only be expected to grow on
a diet of dirty fossil fuels. As recent-
ly as June 2014, Bill Gates blogged:
“Poor countries... can’t afford today’s
expensive clean energy solutions and
we can’t expect them to wait for the
technology to get cheaper.”
However, the past two years have
seen this received wisdom turned
on its head. Latest figures from the
United Nations Environment Pro-
gramme and Bloomberg New Ener-
gy Finance (BNEF) show that in 2015
total clean energy investment in
developing countries actually sur-
passed that of developed countries
for the first time at $156 billion com-
pared with $130 billion.
The biggest renewable investors
included Chile ($3.5 billion, up 157
per cent) South Africa ($4.5 billion,
up 329 per cent) and Morocco ($2 bil-
lion, up from almost zero in 2014).
India saw investments rise 22 per
cent to $10.2 billion while China,
now the world’s biggest investor in
renewable technology, spent $102.9
billion on renewables (36 per cent of
EMERGING MARKETS THAT IS EXPECTED TO SEE AN INCREASE IN in renewable energy technology,
says Ms Hamilton, but recent polit-
THE NUMBER OF PEOPLE WITHOUT ACCESS TO ELECTRICITY
ical flip-flopping has seen investors
2009 2030 “head to the least risky countries”.
30 10
LATIN
AMERICA
India’s prime minister Narendra
Modi launched a global solar alli-
ance at the Paris climate confer-
ence in December, with his own
country aiming to increase solar
NORTH installations from just below 5GW
1 1 AFRICA to 100GW by 2022. To put that into
perspective, the UK’s entire nucle-
ar capacity is currently 10GW. This
would be more than double the
present solar capacity of current
586 645 SUB-SAHARAN
AFRICA global leader China.
The project might sound far-fetched,
but it is already underway. SB Ener-
gy, a joint Japanese-Taiwanese ven-
ture, recently won a bid for a 350MW
MIDDLE project in India’s Andhra Pradesh
21 5 EAST
province. The Institute for Energy
Economics and Financial Analysis
describes India as “executing one of
the most radical energy sector trans-
formations ever undertaken”.
289 154 INDIA Ronan O’Regan, director of renew-
ables at PwC, believes that for net
Weakest 8 0 CHINA
+ + +
Weak - - -
Developing
countries can now
afford renewable
energy and the
major energy
corporations
can’t afford to
miss out on these
growth markets
importers of fossil fuel such as In-
dia, investing in renewables is eco-
nomically and politically attractive
in developing countries. The cost
of renewables generation also con-
tinues to fall, particularly in solar
photovoltaics. In the second half of
2015, the global average cost of solar
PV was $122 per MWh, down from
$143 in 2014. Wind is even cheaper,
at $83 per MWh in late-2015 com-
pared with $96 per MWh in 2009.
Developing countries can now af-
ford renewable energy and the ma-
jor energy corporations can’t afford
to miss out on these growth mar-
kets. “It is a logical play for the re-
newables businesses to start to look
much more expansively in terms of
geographies,” says Mr O’Regan.
tion and Development, while the
International Finance Corporation
loaned the money to build a 36MW
wind farm in Jamaica.
“Development banks have an im-
portant role to play in terms of pro-
viding liquidity,” says Mr O’Regan.
“They go into projects first, take a
bit more risk, help to make projects
bankable and that gives confidence
to local commercial investors to co-
fund on projects and who themselves
gain knowledge and understand the
risks. So by the next project, you no
longer need the development bank.”
It is a role they may not need to play
for long. Stock market investors and
venture capital are already moving
into renewables projects in emerging
markets. In Uruguay, one of South
America’s leading wind markets,
2015 saw equity raised on the Mon-
tevideo stock market to help finance
local wind projects. While Indian re-
newable energy companies attracted
$548 million in venture capital and
private equity funding in 2015.
“Investments in renewables are
today almost exclusively market
driven,” says Enel’s Mr Starace. “In-
itially governments, by establishing
renewables targets and feed-in tar-
iffs mechanisms, played a key role.
However, the private sector has

the world total).
If you consider investments rela-
tive to annual GDP, the top five in-
vestors globally were actually Mauri-
tania, Honduras, Uruguay, Morocco
and Jamaica. Meanwhile, Costa Rica
is remarkably close to becoming the
first developing country to have 100
per cent renewable electricity.
“Wind and solar power are now
being adopted in many developing
countries as a natural and substan-
tial part of the generation mix,” says
Michael Liebreich, chairman of the
advisory board at BNEF. “They can
be produced more cheaply than often
high wholesale power prices; they re-
duce a country’s exposure to expect-
ed future fossil fuel prices and, above
all, they can be built very quickly.”
While Europe is looking to more
expensive offshore wind options to
appease not-in-my-back-yard vot-
2/3
Strong In the early-2000s, Italian-head- spearheaded this revolution.”
quartered Enel, one of the biggest As for the specific types of renew-
Strongest
REST OF energy companies in the world, was able technology that developing
No data 329 221 DEVELOPING ASIA
energy demand focused on fossil fuel generation countries are investing in, solar and
growth through to 2030 in the northern hemisphere. Since wind are the top two by far, at $80
is likely to come from 2009, however, it has transformed billion and $60 billion spent in 2015
developing countries
into the world’s largest producer of respectively. Small-scale hydro is
Source: Bloomberg New Energy Finance 2016 Source: International Energy Agency renewable energy, with the major- the only real significant other at $4
ity of new business coming from billion. The likes of biomass, bio-
TOP EMERGING MARKETS FOR CLEAN GLOBAL NEW INVESTMENT IN RENEWABLES, BY REGION WORLD ELECTRICITY ACCESS AND LACK OF ACCESS, emerging markets. Its 2016-19 stra- fuel, waste-to-energy and offshore
ENERGY INVESTMENT BY REGION tegic plan commits around 50 per wind remain of more interest to
cent of investment to renewables in wealthier nations.
RANKING MEASURES CLEAN ENERGY INVESTMENT, $BN World total 3% emerging and developing markets. “There are not that many geog-
AVAILABILITY OF LOCAL FUNDS, COST OF DEBT
Developed countries OTHERS Enel’s chief executive Francesco raphies that are pursuing offshore
286
150%
AND GREEN MICROFINANCE ACTIVITY 300
China, India and Brazil 279 Starace says: “Mature markets such wind,” says Mr O’Regan. “It is sig-
273
as Europe are affected by oversup- nificantly more expensive than
HONDURAS Other developing countries 257
1 250
increase expected ply and flat, if not decreasing, elec-
tricity demand. On the contrary,
onshore wind. If you were advising
a developing country on their re-
239 in new electricity
234
2
BOLIVIA 53% 44% capacity in non-OECD an increasing number of emerging newable energy strategy, even if
SUB- DEVELOPING countries by 2030 countries are discovering the ben- you had access to sufficient offshore
NEPAL 83% SAHARAN ASIA
Source:
efits of renewables and attracting resource and the ability to grid-con-
3 200
182 WITH ACCESS AFRICA Pew Charitable Trusts 2015 new investments. They are faster to nect, it would still be one of the last
179 build and easier to operate. On av- things you’d look at.”
GUATEMALA

156
191

ers, many developing countries are 4 erage a typical wind project can be There is also a success story of
happy with cheaper on-shore and
150
154
17% completed in 12 to 18 months, ver- off-grid micro generation rapidly
164

CHINA WITHOUT
solar options. This in turn means
5 sus four to five years for a coal-fired spreading through the developing
131
151

the companies selling those tech- ACCESS plant of a similar size.” world. Some 89 million people in
142

112
136

nologies are increasingly looking PANAMA This is very attractive to investors Africa and Asia already own at least
106

6
130
123

98

towards emerging markets. Total of all sizes. He says: “Emerging and one solar-powered product, accord-
20%
114

100
87
108

renewable investment in Europe NIGERIA developing markets alone repre- ing to the World Bank Group; about
7 URBAN
75

1bn
actually slipped 21 per cent to $48.8 73 sent a $5-trillion potential market, 15 million off-grid households will
64
60
83

billion in 2015 and today’s growth of which more than $300 billion is have solar-powered TVs by 2020.
CHILE
8
46

market is in the global south. 50 expected to go to the energy sector.” West African mini-hydro options
Kirsty Hamilton, an expert in 80% people are not expected Development banks have also could soon provide up to 70 per cent
53

29

to have access
20

URUGUAY RURAL
renewable energy investment at
9 to electricity by 2030, played a part in getting large-scale of rural electricity.
Chatham House, outlines the mix down from 1.3 billion projects up and running. Mexico,
of factors at play, including cost-re- INDONESIA in 2009 for example, has been helped by
ductions, strong government poli- 10 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: International funding from development bank
Share this article online via
Raconteur.net
cies and investors actively looking Source: Bloomberg New Energy Finance 2016 Source: Bloomberg New Energy Finance/UN Environment Programme 2016 Source: International Renewable Energy Agency 2015 Energy Agency Nafin for nine wind projects. The
08 POWERING THE FUTURE raconteur.net 14 / 06 / 2016 RACONTEUR RACONTEUR 14 / 06 / 2016 raconteur.net POWERING THE FUTURE 09

Developing countries take the lead in clean energy market

The West may have begun the clean energy revolution, but developing countries are no longer playing catch-up – in fact, they are now leading the way as an example to the rest of the world

GREEN INVESTMENT ANTICIPATED GROWTH OF GLOBAL POWER DEMAND, 2012-30 CURRENT/PROJECTED POPULATIONS WITHOUT for opportunities. The big European Efeler geothermal plant in Turkey
TIM SMEDLEY AFRICA AND ASIA ARE PREDICTED TO SEE THE STRONGEST INCREASE ACCESS TO ELECTRICITY (M) projects, such as Germany’s Energie- also received $200 million from
SUB-SAHARAN AFRICA IS THE ONLY REGION IN DEVELOPING AND wende, may have driven the growth the European Bank for Reconstruc-

R
enewable energy used to be
deemed unaffordable for
developing countries. Wind
and solar were rich country
luxuries, while third world economies
could only be expected to grow on
a diet of dirty fossil fuels. As recent-
ly as June 2014, Bill Gates blogged:
“Poor countries... can’t afford today’s
expensive clean energy solutions and
we can’t expect them to wait for the
technology to get cheaper.”
However, the past two years have
seen this received wisdom turned
on its head. Latest figures from the
United Nations Environment Pro-
gramme and Bloomberg New Ener-
gy Finance (BNEF) show that in 2015
total clean energy investment in
developing countries actually sur-
passed that of developed countries
for the first time at $156 billion com-
pared with $130 billion.
The biggest renewable investors
included Chile ($3.5 billion, up 157
per cent) South Africa ($4.5 billion,
up 329 per cent) and Morocco ($2 bil-
lion, up from almost zero in 2014).
India saw investments rise 22 per
cent to $10.2 billion while China,
now the world’s biggest investor in
renewable technology, spent $102.9
billion on renewables (36 per cent of
EMERGING MARKETS THAT IS EXPECTED TO SEE AN INCREASE IN in renewable energy technology,
says Ms Hamilton, but recent polit-
THE NUMBER OF PEOPLE WITHOUT ACCESS TO ELECTRICITY
ical flip-flopping has seen investors
2009 2030 “head to the least risky countries”.
30 10
LATIN
AMERICA
India’s prime minister Narendra
Modi launched a global solar alli-
ance at the Paris climate confer-
ence in December, with his own
country aiming to increase solar
NORTH installations from just below 5GW
1 1 AFRICA to 100GW by 2022. To put that into
perspective, the UK’s entire nucle-
ar capacity is currently 10GW. This
would be more than double the
present solar capacity of current
586 645 SUB-SAHARAN
AFRICA global leader China.
The project might sound far-fetched,
but it is already underway. SB Ener-
gy, a joint Japanese-Taiwanese ven-
ture, recently won a bid for a 350MW
MIDDLE project in India’s Andhra Pradesh
21 5 EAST
province. The Institute for Energy
Economics and Financial Analysis
describes India as “executing one of
the most radical energy sector trans-
formations ever undertaken”.
289 154 INDIA Ronan O’Regan, director of renew-
ables at PwC, believes that for net
Weakest 8 0 CHINA
+ + +
Weak - - -
Developing
countries can now
afford renewable
energy and the
major energy
corporations
can’t afford to
miss out on these
growth markets
importers of fossil fuel such as In-
dia, investing in renewables is eco-
nomically and politically attractive
in developing countries. The cost
of renewables generation also con-
tinues to fall, particularly in solar
photovoltaics. In the second half of
2015, the global average cost of solar
PV was $122 per MWh, down from
$143 in 2014. Wind is even cheaper,
at $83 per MWh in late-2015 com-
pared with $96 per MWh in 2009.
Developing countries can now af-
ford renewable energy and the ma-
jor energy corporations can’t afford
to miss out on these growth mar-
kets. “It is a logical play for the re-
newables businesses to start to look
much more expansively in terms of
geographies,” says Mr O’Regan.
tion and Development, while the
International Finance Corporation
loaned the money to build a 36MW
wind farm in Jamaica.
“Development banks have an im-
portant role to play in terms of pro-
viding liquidity,” says Mr O’Regan.
“They go into projects first, take a
bit more risk, help to make projects
bankable and that gives confidence
to local commercial investors to co-
fund on projects and who themselves
gain knowledge and understand the
risks. So by the next project, you no
longer need the development bank.”
It is a role they may not need to play
for long. Stock market investors and
venture capital are already moving
into renewables projects in emerging
markets. In Uruguay, one of South
America’s leading wind markets,
2015 saw equity raised on the Mon-
tevideo stock market to help finance
local wind projects. While Indian re-
newable energy companies attracted
$548 million in venture capital and
private equity funding in 2015.
“Investments in renewables are
today almost exclusively market
driven,” says Enel’s Mr Starace. “In-
itially governments, by establishing
renewables targets and feed-in tar-
iffs mechanisms, played a key role.
However, the private sector has

the world total).
If you consider investments rela-
tive to annual GDP, the top five in-
vestors globally were actually Mauri-
tania, Honduras, Uruguay, Morocco
and Jamaica. Meanwhile, Costa Rica
is remarkably close to becoming the
first developing country to have 100
per cent renewable electricity.
“Wind and solar power are now
being adopted in many developing
countries as a natural and substan-
tial part of the generation mix,” says
Michael Liebreich, chairman of the
advisory board at BNEF. “They can
be produced more cheaply than often
high wholesale power prices; they re-
duce a country’s exposure to expect-
ed future fossil fuel prices and, above
all, they can be built very quickly.”
While Europe is looking to more
expensive offshore wind options to
appease not-in-my-back-yard vot-
2/3
Strong In the early-2000s, Italian-head- spearheaded this revolution.”
quartered Enel, one of the biggest As for the specific types of renew-
Strongest
REST OF energy companies in the world, was able technology that developing
No data 329 221 DEVELOPING ASIA
energy demand focused on fossil fuel generation countries are investing in, solar and
growth through to 2030 in the northern hemisphere. Since wind are the top two by far, at $80
is likely to come from 2009, however, it has transformed billion and $60 billion spent in 2015
developing countries
into the world’s largest producer of respectively. Small-scale hydro is
Source: Bloomberg New Energy Finance 2016 Source: International Energy Agency renewable energy, with the major- the only real significant other at $4
ity of new business coming from billion. The likes of biomass, bio-
TOP EMERGING MARKETS FOR CLEAN GLOBAL NEW INVESTMENT IN RENEWABLES, BY REGION WORLD ELECTRICITY ACCESS AND LACK OF ACCESS, emerging markets. Its 2016-19 stra- fuel, waste-to-energy and offshore
ENERGY INVESTMENT BY REGION tegic plan commits around 50 per wind remain of more interest to
cent of investment to renewables in wealthier nations.
RANKING MEASURES CLEAN ENERGY INVESTMENT, $BN World total 3% emerging and developing markets. “There are not that many geog-
AVAILABILITY OF LOCAL FUNDS, COST OF DEBT
Developed countries OTHERS Enel’s chief executive Francesco raphies that are pursuing offshore
286
150%
AND GREEN MICROFINANCE ACTIVITY 300
China, India and Brazil 279 Starace says: “Mature markets such wind,” says Mr O’Regan. “It is sig-
273
as Europe are affected by oversup- nificantly more expensive than
HONDURAS Other developing countries 257
1 250
increase expected ply and flat, if not decreasing, elec-
tricity demand. On the contrary,
onshore wind. If you were advising
a developing country on their re-
239 in new electricity
234
2
BOLIVIA 53% 44% capacity in non-OECD an increasing number of emerging newable energy strategy, even if
SUB- DEVELOPING countries by 2030 countries are discovering the ben- you had access to sufficient offshore
NEPAL 83% SAHARAN ASIA
Source:
efits of renewables and attracting resource and the ability to grid-con-
3 200
182 WITH ACCESS AFRICA Pew Charitable Trusts 2015 new investments. They are faster to nect, it would still be one of the last
179 build and easier to operate. On av- things you’d look at.”
GUATEMALA

156
191

ers, many developing countries are 4 erage a typical wind project can be There is also a success story of
happy with cheaper on-shore and
150
154
17% completed in 12 to 18 months, ver- off-grid micro generation rapidly
164

CHINA WITHOUT
solar options. This in turn means
5 sus four to five years for a coal-fired spreading through the developing
131
151

the companies selling those tech- ACCESS plant of a similar size.” world. Some 89 million people in
142

112
136

nologies are increasingly looking PANAMA This is very attractive to investors Africa and Asia already own at least
106

6
130
123

98

towards emerging markets. Total of all sizes. He says: “Emerging and one solar-powered product, accord-
20%
114

100
87
108

renewable investment in Europe NIGERIA developing markets alone repre- ing to the World Bank Group; about
7 URBAN
75

1bn
actually slipped 21 per cent to $48.8 73 sent a $5-trillion potential market, 15 million off-grid households will
64
60
83

billion in 2015 and today’s growth of which more than $300 billion is have solar-powered TVs by 2020.
CHILE
8
46

market is in the global south. 50 expected to go to the energy sector.” West African mini-hydro options
Kirsty Hamilton, an expert in 80% people are not expected Development banks have also could soon provide up to 70 per cent
53

29

to have access
20

URUGUAY RURAL
renewable energy investment at
9 to electricity by 2030, played a part in getting large-scale of rural electricity.
Chatham House, outlines the mix down from 1.3 billion projects up and running. Mexico,
of factors at play, including cost-re- INDONESIA in 2009 for example, has been helped by
ductions, strong government poli- 10 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: International funding from development bank
Share this article online via
Raconteur.net
cies and investors actively looking Source: Bloomberg New Energy Finance 2016 Source: Bloomberg New Energy Finance/UN Environment Programme 2016 Source: International Renewable Energy Agency 2015 Energy Agency Nafin for nine wind projects. The
10 POWERING THE FUTURE
Turn down the demand to balanc e the supply
Demand-side response, a scheme in which customers are incentivised financially to lower or shift their electricity use at peak times, is changing
the dynamics of the UK energy market
DEMAND RESPONSE
FELICIA JACKSON
L
ast month the UK gener-
ated zero coal-fired power
for the first time in a hun-
dred years. This is the lat-
est sign that our electricity markets
are undergoing a paradigm shift,
but one that increases challenges to
grid management.
An increasingly popular solution
is to develop demand-side response
(DSR). This takes control and man-
agement away from generators. But
what does that actually mean, and
how can industry, manufacturing
and other sectors make the most of
the opportunity?
Even aside from changes to gen-
eration, the structure of the elec-
tricity market is complex, involv-
ing a mix of energy market actors,
including the system operator, dis-
tribution network operators, small
and large suppliers, aggregators,
and third parties.
At the same time the UK faces
a changing generation portfolio,
shifting policy and growing concern
that brownouts (reductions in volt-
age) might affect productivity, with
the UK expected to lose 10 per cent
of its baseload generation in the next
few years.
The UK must find a way to pro-
vide baseload power, balance in-
termittent generation and remain
flexible enough to meet demand at
need, and integrate new and future
forms of generation and storage.
As system operator, responsible for
minute-by-minute balancing, fre-
quency, capacity and transmission
services, National Grid urgently
requires more flexibility to manage
the network.
ENERGY EFFICIENCY/DEMAND REDUCTION MEASURES
COMPANIES ARE CONSIDERING
79%
53% 53%
Lighting Building Behaviour
controls change
raconteur.net
National Grid also has its Triad sys-
tem, the transmission and distribu-
tion component of the electricity bill,
The UK faces which can be reduced by curtailing
a changing consumption in winter afternoons,
generation by encouraging industry consump-
tion shifts through higher prices.
portfolio, shifting Another option is frequency re-
policy and growing sponse, an automatic load-shedding
concern that arrangement based on frequency
brownouts might signals of the electricity supply and
there are local schemes run by dis-
affect productivity tribution network operators.
But what is needed for DSR to
make a real impact on the UK elec-
A number of schemes already exist tricity market? Simple, high loads of
to help. One option is STOR (Short- accessible, flexible generation.
Term Operating Reserve), a scheme So National Grid has put its stake
run by National Grid to cover against in the ground with its Power Re-
short variations in supply-demand sponsive campaign, which is in-
balance through power plant failure, tended to encourage industry take-
cold wave, TV pick-up and so on. up of demand-side solutions, with
the aim that DSR will make up 30 to
50 per cent of balancing actions by
2020. Given that National Grid al-
ready spends around £850 million
each year on balancing services,
this provides exciting opportuni-
ties for industry, from the chance
to generate extra income, to re-
duced monthly power bills, and
42% avoiding damage of costly machin-
ery and equipment.
37% Barry Cressie, smart grids director
at Schneider Electric, points out that
factories, hospitals, and universities
can shift usage on the basis of price.
He says: “The profile of usage is con-
stantly changing, from generation
profile to failures of equipment, re-
routing of power to managing inter-
mittency. Complex systems that can
manage and analyse vast quantities
of data are required, and the growth
On-site Demand
of the internet of things is opening
generation response/
up far wider opportunities.”
reduction
This means any sector can help
Source: Energyst Media 2016 provide, and benefit from, DSR. What
14 / 06 / 2016 RACONTEUR
matters is having load or generation shiftable, United Utilities expects to
that can be made flexible. Using in- be able to offer a total of 500MW of
depth data analysis and sensor net- flexible capacity and reduce carbon
works, and combining these with an emissions by 100,000 tonnes a year.
understanding of business process, Energy Pool works with steel mills,
aggregators can manage a client’s abrasives companies, pulp and pa-
internal power networks, managing per producers, and cement manu-
to turn down usage without impact- facturers. REstore’s portfolio mean-
ing productivity. while includes a former Tata Steel
Aggregators such as Energy Pool, site (now owned by Sahaviriya Steel
Open Energi, KiWi Power, Reactive Industries UK), Barclays’ real es-
Technologies and many more can tate portfolio, oxygen and hydrogen
create and then aggregate individ- manufacturer Praxair, and quick-
ual loads at a site, from a pump, an lime producer Lhoist.
air conditioning unit or a back-up Chris Kimmett, commercial man-
generator, and combine them with ager at Open Energi, says: “Research
others to provide a flexible service has shown that the UK has 6GW of
for which National Grid pays a range easily accessible flexible power.” This
of service fees. is equivalent to 12 UK power stations
According to Louis Burford, UK and not only represents a cut of 3GW
vice president at REstore, providing off peak demand, but could also cut
Getty Images
primary reserve can earn a company the cost of providing power from
between £50,000 and £75,000 an- roughly £700,000 per megawatt for
nually, and has the smallest impact a new gas-fired power plant to
as a call to turn down demand – an around £350,000 a megawatt.
activation – typically lasts no longer A 2015 report from Energyst Me-
than four to five minutes. dia, however, showed that 67 per
For example, Open Energi works cent of businesses weren’t partici-
with United Utilities. Successful pating in DSR because they didn’t
operation of its DSR scheme is crit- understand the products and ser-
ical to the water supply for a large vices available or they felt they
swathe of the country, as the tech- were too small to make a differ-
nology controls equipment respon- ence. This is the biggest challenge
sible for regulating ammonia levels facing DSR.
in drinking water. Paul Lowbridge, Power Responsive
But by working with an aggregator programme manager at National
that understands what processes are
business critical and which are time
Grid, says: “National Grid is well
placed to bring the industry together
CASE STUDY: MINISTRY OF DEFENCE
Early findings were this had an impact
on usage levels and reduced demand,
albeit to a limited extent, as the scheme
is in its early days. But the indications
are that it works.
The importance of MoD sites to
national security and to assist civil
authorities means the estate must
have a resilient energy profile to
enable operations to continue during
a crisis. The distribution network
operator’s demand reduction
programme has, therefore, forced the
MoD to take a more lateral approach
The Ministry of Defence (MoD) is taking a to energy usage, encouraging more
robust approach to demand-side response efficient use of assets, as well as
(DSR) to cut the cost of infrastructure reduced usage and maintenance costs
investment and overall usage. of the estate.
The MoD’s estates branch carried out As the DSR process continues to
its annual Triad stand-down campaign develop, the MoD will have
to pursue
to reduce transmission charges, both energy and asset efficiency further
along with an innovative Red Tuesday to enable release of reserve energy
DUoS (Distribution Use of System) capacity or demonstrate why this
competition to encourage personnel should not be done. Similar issues affect
to hold meetings or alter their working other government-funded bodies,
hours to avoid using IT and other especially fixed-asset rich organisations
equipment during the “red” peak phase such as the NHS, schools, colleges
of pricing. and universities.
RACONTEUR xx xx / 2016
14 / 06 xxxx
TOP REASONS WHY COMPANIES HAVE NOT CONSIDERED A
DEMAND-SIDE RESPONSE
Equipment/processes are
not suitable
Concerned about disruption and
impact on business performance
Don’t understand enough about
the market and different options
Return on investment not
attractive enough
Lack of trust in a third party
having control over your kit
Not aware of it
Does not count towards
carbon reductions
given its pivotal role in the UK’s en-
ergy market. The challenge for Power
Responsive is to exploit the opportu-
nities to radically evolve our energy
system, by changing the way we de-
mand and consumer electricity.
“We already use a lot of these prod-
ucts to balance the system minute
by minute. Improvements in tech-
nology allow companies to speak to
each other in evermore sophisticat-
ed ways, and now energy systems
can be more sophisticated and re-
sponsive, allowing them to be flexi-
ble. There are financial benefits and
it can be a low carbon option.”
Turning down demand is not
enough alone,
however. National
Grid is currently
trialling the con-
cept of turning up
If just 5 per cent
demand in a pilot
called Demand of peak demand is
Turn Up (DTU). met by demand-side
When, for exam- response solutions,
ple, there are sig-
nificantly high
it could benefit
levels of renewable consumers by
generation on a approximately
windy, sunny day,
one question is
£500 million
where to put power
which could over-
load the grid. The DTU programme
is being trialled up to September
2016 and consists of 309MW of
turn-up power.
It sees National Grid joining forces
with a regional distribution network
operator to co-ordinate its delivery,
meeting the needs of both the na-
tional power system and local power
networks at the same time. The ser-
vice will essentially be shared with
Western Power Distribution cover-
ing the Midlands, South West and
Wales, and can either encourage us-
ers to shift their power use or reduce
their generation.
There is a benefit for consumers
as well. According to National Grid,
if just 5 per cent of peak demand is
46%
27%
25%
22%
22%
17%
5%
Source: Energyst Media 2015
met by DSR solutions, it could ben-
efit consumers by approximately
£500 million. And DSR, which is
currently targeted at large-scale
customers, could benefit retail con-
sumers directly in the future. Many
of the early trials were in the retail
consumer market, but the margins
were low due to the lack of infra-
structure. Yet the current rollout
of smart meters around the UK, as
well as sensor-enabled white goods,
means the market will eventually
move in that direction.
Naturally, making this effective
will require action on more than one
front. According to Dr Harald Heu-
baum at SOAS, Uni-
versity of London:
“Rolling out smart
metres across the
UK can only ever
be one part of the
solution. Another
has to be targeted
regulation to en-
able consumers
to play an active
and full role in the
market, engaging
directly with ag-
gregation service
providers and in
doing so stimu-
lating competition between them.
Regulation should treat demand
response in the same way it treats
different forms of energy generation
and energy storage.”
Until then, however, aggregators
are offering UK industry a chance
to make the most of the opportuni-
ties available. And the more pow-
er consumers join up, increasing
the depth and breadth of the pool,
the more they generate income –
and the UK is well on the way to
creating a new approach to its en-
ergy system.
Share this article online via
Raconteur.net
raconteur.net
RESTORE WINS LANDMARK
£6M DSR CONTRACT WITH
NATIONAL GRID
D
emand-side response (DSR)
provides an opportunity for
consumers to play a significant
role in balancing the electricity grid
by reducing or enhancing their usage
for very short periods in response to
instructions sent by National Grid. In
return, consumers receive significant
cash payments.
In late-2015, National Grid’s chief
executive Steve Holliday announced the
power network intends to have 30 to 50
per cent of its grid balancing services
provided through DSR by 2020, with
more than 50 per cent by 2030. Such
a strong and immediate target changes
the game for DSR and potentially the
future of the UK energy market. The
target says the UK is serious about using
new ways of providing power as and
when it is needed.
REstore is one of the main
technology players in this field and the
market leader in providing such services
to National Grid in the UK. It recently
won the largest DSR contract in the
UK’s FFR (firm frequency response)
auctions, at 48 megawatts and worth £6
million. REstore co-chief executive Jan-
Willem Rombouts and Louis Burford,
who heads up REstore’s UK operation,
describe how the market is changing.
“What DSR manages to do is solve
structural problems in the UK energy
market,” says Mr Burford. Large energy
utilities have been hit by a perfect
storm, especially in Europe – energy
producers are making losses as thermal
power plants are ‘out of the money’,
while energy suppliers are trapped in
low-margin commodity sales.”
Now, however, cutting-edge software,
complex algorithms, improved forecasting
and an internet of things approach
to managing assets have combined
in such a way that new downstream
activities such as DSR can be provided.
REstore’s FlexpondTM platform
connects to thousands of sensors in
THREE MYTHS ABOUT DSR
Myth 1 - That an industrial user or
manufacturer has no flexibility in
its systems.
Reality - Most systems have
flexibility, even if only in the
parameters within which they
effectively operate. For any large
organisation, operating across ten
to fifteen sites, there is likely to be
significant flexibility. Some 250MW
has been identified in London alone,
enough to replace a peaking power
plant. Organisations can earn seven-
figure sums in a year simply by
taking advantage of such flexibility
and with no impact on output.
COMMERCIAL FEATURE
industries and buildings to provide data
from equipment such as arc furnaces,
cold stores and air conditioning units,
turning them into smart devices which
can react instantly to the changing
balance of power on the grid and free
up capacity on the network.
Mr Rombouts points out that the
patented Flexpond platform is based on
respecting industrial process conditions.
He says: “At the heart of our cloud-
based platform are industrial loads with
strict boundary conditions – operational
boundaries such as maximum
temperature, minimal pressure levels
or volumes of intermediate stock that
need to be met at all times, otherwise
activation won’t happen.”
There is a reason why REstore
has a Europe-wide DSR pool of 1.5
gigawatts, of which 500MW are
constantly available at 98 per cent.
The company has deep understanding
of industrial processes, with team
members harking from Honeywell, SSI
Steel, INEOS, BASF and elsewhere. It
also deploys a network of former plant
managers in order to identify flexible
power on the shopfloor.
One of the challenges for
aggregators, transmission system
operators and power utilities is there are
many perceived risks around DSR among
Myth 2 - Loss of control over
production process.
Reality - The calls for DSR through
REstore’s Flexpond platform
are controlled by the boundary
conditions set by the business. If
a certain system cannot go below
a certain temperature without
affecting production, it never will.
In fact, it’s worth noting that the
average call for turn-down is three
minutes, with no call longer than
five minutes – not long enough to
affect the temperature in a fridge if
you turned it down that long with
the door closed.
XXXX
POWERING THE FUTURE 2
11
© REstore
plant and facility managers. However,
in reality, DSR is a way to earn money,
minimise energy costs and reduce
CO2 emissions. Basically, companies
get to do good and make money,
but that does no one any good if the
operators think it’s too good to be true.
Not only are there genuine
benefits for commercial and industrial
consumers, but the response times
for DSR are far faster than traditional
generation. DSR achieves responses to
calls for power in less than 30 seconds,
regardless of total power volume, faster
than a spinning combined-cycle gas
turbine. This means that as it spreads,
DSR can begin to help balance demand
and supply in real time.
UK energy transition requires
consumption increasingly to be
responsive and flexible. For many
years, REstore has been the leader in
encouraging consumers to take steps in
that direction.
Today, REstore launches a three-
month project to recruit large
industrial and commercial consumers
to participate in its £6-million DSR
initiative together with National
Grid. “We’re just looking for the right
commercial and industrial electricity
consumers to share the multi-million-
pound cheque with,” says Mr Burford.
Myth 3 - That DSR could impact
productivity.
Reality - All systems have
inherent flexibility built into
them – there are natural buffers
in any system and if sufficient
attention is paid to the limiting
factors, then platforms such
as Flexpond manages all the
intelligence in real time.
?
10 POWERING THE FUTURE
Turn down the demand to balanc e the supply
Demand-side response, a scheme in which customers are incentivised financially to lower or shift their electricity use at peak times, is changing
the dynamics of the UK energy market
DEMAND RESPONSE
FELICIA JACKSON
L
ast month the UK gener-
ated zero coal-fired power
for the first time in a hun-
dred years. This is the lat-
est sign that our electricity markets
are undergoing a paradigm shift,
but one that increases challenges to
grid management.
An increasingly popular solution
is to develop demand-side response
(DSR). This takes control and man-
agement away from generators. But
what does that actually mean, and
how can industry, manufacturing
and other sectors make the most of
the opportunity?
Even aside from changes to gen-
eration, the structure of the elec-
tricity market is complex, involv-
ing a mix of energy market actors,
including the system operator, dis-
tribution network operators, small
and large suppliers, aggregators,
and third parties.
At the same time the UK faces
a changing generation portfolio,
shifting policy and growing concern
that brownouts (reductions in volt-
age) might affect productivity, with
the UK expected to lose 10 per cent
of its baseload generation in the next
few years.
The UK must find a way to pro-
vide baseload power, balance in-
termittent generation and remain
flexible enough to meet demand at
need, and integrate new and future
forms of generation and storage.
As system operator, responsible for
minute-by-minute balancing, fre-
quency, capacity and transmission
services, National Grid urgently
requires more flexibility to manage
the network.
ENERGY EFFICIENCY/DEMAND REDUCTION MEASURES
COMPANIES ARE CONSIDERING
79%
53% 53%
Lighting Building Behaviour
controls change
raconteur.net
National Grid also has its Triad sys-
tem, the transmission and distribu-
tion component of the electricity bill,
The UK faces which can be reduced by curtailing
a changing consumption in winter afternoons,
generation by encouraging industry consump-
tion shifts through higher prices.
portfolio, shifting Another option is frequency re-
policy and growing sponse, an automatic load-shedding
concern that arrangement based on frequency
brownouts might signals of the electricity supply and
there are local schemes run by dis-
affect productivity tribution network operators.
But what is needed for DSR to
make a real impact on the UK elec-
A number of schemes already exist tricity market? Simple, high loads of
to help. One option is STOR (Short- accessible, flexible generation.
Term Operating Reserve), a scheme So National Grid has put its stake
run by National Grid to cover against in the ground with its Power Re-
short variations in supply-demand sponsive campaign, which is in-
balance through power plant failure, tended to encourage industry take-
cold wave, TV pick-up and so on. up of demand-side solutions, with
the aim that DSR will make up 30 to
50 per cent of balancing actions by
2020. Given that National Grid al-
ready spends around £850 million
each year on balancing services,
this provides exciting opportuni-
ties for industry, from the chance
to generate extra income, to re-
duced monthly power bills, and
42% avoiding damage of costly machin-
ery and equipment.
37% Barry Cressie, smart grids director
at Schneider Electric, points out that
factories, hospitals, and universities
can shift usage on the basis of price.
He says: “The profile of usage is con-
stantly changing, from generation
profile to failures of equipment, re-
routing of power to managing inter-
mittency. Complex systems that can
manage and analyse vast quantities
of data are required, and the growth
On-site Demand
of the internet of things is opening
generation response/
up far wider opportunities.”
reduction
This means any sector can help
Source: Energyst Media 2016 provide, and benefit from, DSR. What
14 / 06 / 2016 RACONTEUR
matters is having load or generation shiftable, United Utilities expects to
that can be made flexible. Using in- be able to offer a total of 500MW of
depth data analysis and sensor net- flexible capacity and reduce carbon
works, and combining these with an emissions by 100,000 tonnes a year.
understanding of business process, Energy Pool works with steel mills,
aggregators can manage a client’s abrasives companies, pulp and pa-
internal power networks, managing per producers, and cement manu-
to turn down usage without impact- facturers. REstore’s portfolio mean-
ing productivity. while includes a former Tata Steel
Aggregators such as Energy Pool, site (now owned by Sahaviriya Steel
Open Energi, KiWi Power, Reactive Industries UK), Barclays’ real es-
Technologies and many more can tate portfolio, oxygen and hydrogen
create and then aggregate individ- manufacturer Praxair, and quick-
ual loads at a site, from a pump, an lime producer Lhoist.
air conditioning unit or a back-up Chris Kimmett, commercial man-
generator, and combine them with ager at Open Energi, says: “Research
others to provide a flexible service has shown that the UK has 6GW of
for which National Grid pays a range easily accessible flexible power.” This
of service fees. is equivalent to 12 UK power stations
According to Louis Burford, UK and not only represents a cut of 3GW
vice president at REstore, providing off peak demand, but could also cut
Getty Images
primary reserve can earn a company the cost of providing power from
between £50,000 and £75,000 an- roughly £700,000 per megawatt for
nually, and has the smallest impact a new gas-fired power plant to
as a call to turn down demand – an around £350,000 a megawatt.
activation – typically lasts no longer A 2015 report from Energyst Me-
than four to five minutes. dia, however, showed that 67 per
For example, Open Energi works cent of businesses weren’t partici-
with United Utilities. Successful pating in DSR because they didn’t
operation of its DSR scheme is crit- understand the products and ser-
ical to the water supply for a large vices available or they felt they
swathe of the country, as the tech- were too small to make a differ-
nology controls equipment respon- ence. This is the biggest challenge
sible for regulating ammonia levels facing DSR.
in drinking water. Paul Lowbridge, Power Responsive
But by working with an aggregator programme manager at National
that understands what processes are
business critical and which are time
Grid, says: “National Grid is well
placed to bring the industry together
CASE STUDY: MINISTRY OF DEFENCE
Early findings were this had an impact
on usage levels and reduced demand,
albeit to a limited extent, as the scheme
is in its early days. But the indications
are that it works.
The importance of MoD sites to
national security and to assist civil
authorities means the estate must
have a resilient energy profile to
enable operations to continue during
a crisis. The distribution network
operator’s demand reduction
programme has, therefore, forced the
MoD to take a more lateral approach
The Ministry of Defence (MoD) is taking a to energy usage, encouraging more
robust approach to demand-side response efficient use of assets, as well as
(DSR) to cut the cost of infrastructure reduced usage and maintenance costs
investment and overall usage. of the estate.
The MoD’s estates branch carried out As the DSR process continues to
its annual Triad stand-down campaign develop, the MoD will have
to pursue
to reduce transmission charges, both energy and asset efficiency further
along with an innovative Red Tuesday to enable release of reserve energy
DUoS (Distribution Use of System) capacity or demonstrate why this
competition to encourage personnel should not be done. Similar issues affect
to hold meetings or alter their working other government-funded bodies,
hours to avoid using IT and other especially fixed-asset rich organisations
equipment during the “red” peak phase such as the NHS, schools, colleges
of pricing. and universities.
RACONTEUR xx xx / 2016
14 / 06 xxxx
TOP REASONS WHY COMPANIES HAVE NOT CONSIDERED A
DEMAND-SIDE RESPONSE
Equipment/processes are
not suitable
Concerned about disruption and
impact on business performance
Don’t understand enough about
the market and different options
Return on investment not
attractive enough
Lack of trust in a third party
having control over your kit
Not aware of it
Does not count towards
carbon reductions
given its pivotal role in the UK’s en-
ergy market. The challenge for Power
Responsive is to exploit the opportu-
nities to radically evolve our energy
system, by changing the way we de-
mand and consumer electricity.
“We already use a lot of these prod-
ucts to balance the system minute
by minute. Improvements in tech-
nology allow companies to speak to
each other in evermore sophisticat-
ed ways, and now energy systems
can be more sophisticated and re-
sponsive, allowing them to be flexi-
ble. There are financial benefits and
it can be a low carbon option.”
Turning down demand is not
enough alone,
however. National
Grid is currently
trialling the con-
cept of turning up
If just 5 per cent
demand in a pilot
called Demand of peak demand is
Turn Up (DTU). met by demand-side
When, for exam- response solutions,
ple, there are sig-
nificantly high
it could benefit
levels of renewable consumers by
generation on a approximately
windy, sunny day,
one question is
£500 million
where to put power
which could over-
load the grid. The DTU programme
is being trialled up to September
2016 and consists of 309MW of
turn-up power.
It sees National Grid joining forces
with a regional distribution network
operator to co-ordinate its delivery,
meeting the needs of both the na-
tional power system and local power
networks at the same time. The ser-
vice will essentially be shared with
Western Power Distribution cover-
ing the Midlands, South West and
Wales, and can either encourage us-
ers to shift their power use or reduce
their generation.
There is a benefit for consumers
as well. According to National Grid,
if just 5 per cent of peak demand is
46%
27%
25%
22%
22%
17%
5%
Source: Energyst Media 2015
met by DSR solutions, it could ben-
efit consumers by approximately
£500 million. And DSR, which is
currently targeted at large-scale
customers, could benefit retail con-
sumers directly in the future. Many
of the early trials were in the retail
consumer market, but the margins
were low due to the lack of infra-
structure. Yet the current rollout
of smart meters around the UK, as
well as sensor-enabled white goods,
means the market will eventually
move in that direction.
Naturally, making this effective
will require action on more than one
front. According to Dr Harald Heu-
baum at SOAS, Uni-
versity of London:
“Rolling out smart
metres across the
UK can only ever
be one part of the
solution. Another
has to be targeted
regulation to en-
able consumers
to play an active
and full role in the
market, engaging
directly with ag-
gregation service
providers and in
doing so stimu-
lating competition between them.
Regulation should treat demand
response in the same way it treats
different forms of energy generation
and energy storage.”
Until then, however, aggregators
are offering UK industry a chance
to make the most of the opportuni-
ties available. And the more pow-
er consumers join up, increasing
the depth and breadth of the pool,
the more they generate income –
and the UK is well on the way to
creating a new approach to its en-
ergy system.
Share this article online via
Raconteur.net
raconteur.net
RESTORE WINS LANDMARK
£6M DSR CONTRACT WITH
NATIONAL GRID
D
emand-side response (DSR)
provides an opportunity for
consumers to play a significant
role in balancing the electricity grid
by reducing or enhancing their usage
for very short periods in response to
instructions sent by National Grid. In
return, consumers receive significant
cash payments.
In late-2015, National Grid’s chief
executive Steve Holliday announced the
power network intends to have 30 to 50
per cent of its grid balancing services
provided through DSR by 2020, with
more than 50 per cent by 2030. Such
a strong and immediate target changes
the game for DSR and potentially the
future of the UK energy market. The
target says the UK is serious about using
new ways of providing power as and
when it is needed.
REstore is one of the main
technology players in this field and the
market leader in providing such services
to National Grid in the UK. It recently
won the largest DSR contract in the
UK’s FFR (firm frequency response)
auctions, at 48 megawatts and worth £6
million. REstore co-chief executive Jan-
Willem Rombouts and Louis Burford,
who heads up REstore’s UK operation,
describe how the market is changing.
“What DSR manages to do is solve
structural problems in the UK energy
market,” says Mr Burford. Large energy
utilities have been hit by a perfect
storm, especially in Europe – energy
producers are making losses as thermal
power plants are ‘out of the money’,
while energy suppliers are trapped in
low-margin commodity sales.”
Now, however, cutting-edge software,
complex algorithms, improved forecasting
and an internet of things approach
to managing assets have combined
in such a way that new downstream
activities such as DSR can be provided.
REstore’s FlexpondTM platform
connects to thousands of sensors in
THREE MYTHS ABOUT DSR
Myth 1 - That an industrial user or
manufacturer has no flexibility in
its systems.
Reality - Most systems have
flexibility, even if only in the
parameters within which they
effectively operate. For any large
organisation, operating across ten
to fifteen sites, there is likely to be
significant flexibility. Some 250MW
has been identified in London alone,
enough to replace a peaking power
plant. Organisations can earn seven-
figure sums in a year simply by
taking advantage of such flexibility
and with no impact on output.
COMMERCIAL FEATURE
industries and buildings to provide data
from equipment such as arc furnaces,
cold stores and air conditioning units,
turning them into smart devices which
can react instantly to the changing
balance of power on the grid and free
up capacity on the network.
Mr Rombouts points out that the
patented Flexpond platform is based on
respecting industrial process conditions.
He says: “At the heart of our cloud-
based platform are industrial loads with
strict boundary conditions – operational
boundaries such as maximum
temperature, minimal pressure levels
or volumes of intermediate stock that
need to be met at all times, otherwise
activation won’t happen.”
There is a reason why REstore
has a Europe-wide DSR pool of 1.5
gigawatts, of which 500MW are
constantly available at 98 per cent.
The company has deep understanding
of industrial processes, with team
members harking from Honeywell, SSI
Steel, INEOS, BASF and elsewhere. It
also deploys a network of former plant
managers in order to identify flexible
power on the shopfloor.
One of the challenges for
aggregators, transmission system
operators and power utilities is there are
many perceived risks around DSR among
Myth 2 - Loss of control over
production process.
Reality - The calls for DSR through
REstore’s Flexpond platform
are controlled by the boundary
conditions set by the business. If
a certain system cannot go below
a certain temperature without
affecting production, it never will.
In fact, it’s worth noting that the
average call for turn-down is three
minutes, with no call longer than
five minutes – not long enough to
affect the temperature in a fridge if
you turned it down that long with
the door closed.
XXXX
POWERING THE FUTURE 2
11
© REstore
plant and facility managers. However,
in reality, DSR is a way to earn money,
minimise energy costs and reduce
CO2 emissions. Basically, companies
get to do good and make money,
but that does no one any good if the
operators think it’s too good to be true.
Not only are there genuine
benefits for commercial and industrial
consumers, but the response times
for DSR are far faster than traditional
generation. DSR achieves responses to
calls for power in less than 30 seconds,
regardless of total power volume, faster
than a spinning combined-cycle gas
turbine. This means that as it spreads,
DSR can begin to help balance demand
and supply in real time.
UK energy transition requires
consumption increasingly to be
responsive and flexible. For many
years, REstore has been the leader in
encouraging consumers to take steps in
that direction.
Today, REstore launches a three-
month project to recruit large
industrial and commercial consumers
to participate in its £6-million DSR
initiative together with National
Grid. “We’re just looking for the right
commercial and industrial electricity
consumers to share the multi-million-
pound cheque with,” says Mr Burford.
Myth 3 - That DSR could impact
productivity.
Reality - All systems have
inherent flexibility built into
them – there are natural buffers
in any system and if sufficient
attention is paid to the limiting
factors, then platforms such
as Flexpond manages all the
intelligence in real time.
?
12 POWERING THE FUTURE
ENERGY STORAGE
JIM M c CLELLAND
W
hat do you get the
business mogul who
has everything?
Strangely enough,
the answer is somewhat less
exotic than you might expect – en-
ergy storage.
The new Breakthrough Energy
Coalition has declared storage an
investment and innovation pri-
ority. Spearheaded by Bill Gates,
this billionaires’ coalition boasts a
stellar roster of backers, including
Jeff Bezos of Amazon, Mark Zuck-
erberg of Facebook plus Sir Richard
Branson. Not surprisingly, the mar-
ket approves.
According to IHS Technology,
grid-connected energy storage is
set to explode, with annual instal-
lations forecast in excess of 6 giga-
watts in 2017, then skyrocketing
up to more than 40GW by 2022.
The final quarter of 2015 alone
showed a 45 per cent increase in
the global pipeline. Storage is big
and hot.
Storage is also diverse. In North-
ern Ireland, Gaelectric is using €6.5
million of European Union funding
to convert excess energy from renew-
ables into compressed air to store in
salt caverns, almost a mile under-
ground, along the Antrim coast. Its
compressed air energy storage at
Larne will provide 330 megawatts of
power for up to six hours.
By contrast, a $55-million 50MW
facility planned for the Nevada
Desert features a train. Advanced
rail energy storage moves millions
of pounds of mass uphill against
gravity on railroad shuttles. This
process can store enough energy
to power a medium-sized city for
hours, when the train comes back
down the track.
For UK home and business mar-
kets, though, the technology that
figures most in the present energy
debate is battery storage for electric
cars and microgeneration. Entre-
preneur Elon Musk even provides
a certain celebrity sparkle as his
premium electric car brand Tesla
pumps the media profile of its home
battery product Powerwall. Storage
is sexy, almost.
Taking a systemic view of UK
capacity, the Investing in UK Elec-
CASE STUDY: RASA HYDROGEN CAR
This February, a pioneering
Welsh company launched
a clean and green road
machine with a difference
– hydrogen.
Batteries are included
in this game-changer
Storing energy is transforming the UK power market,
changing home and business consumers’ relationship with
consumption while offering the potential to slash bills
GLOBAL INSTALLED DISTRIBUTED ENERGY STORAGE SYSTEMS FORECAST (MW)
14,000 Commercial
Residential
12,000
Community
10,000
8,000
6,000
4,000
2,000
0
2014 2015 2016
Designed from scratch,
Riversimple’s two-seater
Rasa is billed as the most
efficient car in the world for
ordinary road-going use.
With no tailpipe emissions
but water, the hydrogen-
powered FCEV (fuel cell
electric vehicle) refuels in
just three minutes, for
300 miles.
Adding to six-figure EU,
Welsh and UK government
backing, crowdfunding
investors can now take a
2017 2018 2019
stake in the project and a
technology market is up
for grabs, says Riversimple
founder Hugo Spowers.
“Hydrogen cars and
infrastructure are a great
opportunity for the UK to
re-establish leadership in
the car of the future. We
have better skills – and
more of them.”
Available in 2018 through
a unique sale-of-service
model – where customers
pay a fixed monthly
raconteur.net
2020 2021 2022 2023 2024
Source: Navigant Research 2015
amount to cover all costs,
including fuel – the Rasa is
revolutionary, concludes
Dave Hampton, carbon
coach and radio presenter.
He says: “Everything
must change, starting
with how we think. And
Riversimple have rethought
everything – the entire
automotive personal-
mobility dream. The Rasa
is tomorrow’s disruptive
technology on the
road today.”
tricity Storage report by Eunomia
Research & Consulting provides
the first dedicated market fore-
casts. From a relatively low start
point of just over 26MW of capac-
ity spread across 24 sites, find-
ings predict exponential year-on-
year growth to more than 1.6GW
in 2020.
According to principal author
Chloe Bines, the real step-change
anticipated is when National Grid
enhanced frequency response
(EFR) contracts come online in
2017. “We expect to see a number
of battery projects successfully se-
curing contracts as a result of the
EFR tender,” she says. “That’s im-
portant because it helps improve
investor confidence.”
This will benefit both the industry
and its customers, Ms Bines adds.
“EFR is a new way that ‘behind the
meter’ storage can save businesses
money. Not only do they avoid peak
electricity costs, but they can also
make an income from storage while
helping make the grid more resil-
ient,” she says.
Storage can also increase
self-consumption of residential
solar, and the market is excited
about prospects for smart tariffs
and meters to help reduce home-
owners’ bills. Although Ms Bines
tempers this optimism with a note
of caution. “If we’re going to see
residential energy storage take off,
it will depend on time-of-use tar-
iffs becoming available. A differ-
ential between peak and off-peak
14 / 06 / 2016 RACONTEUR
For UK home and
business markets,
the technology
that figures most is
battery storage for
electric cars
and microgeneration
pricing means there’s opportunity
to make a saving through storage,
but it would need to be significant
to become economic at this small
scale,” she says.
In an influential deal struck in
advance of the EFR, National Grid
has signed a four-year contract
with Renewable Energy Systems
(RES) to provide 20MW of frequen-
cy response from battery storage.
The project will prove the effec-
tiveness of storage to act to stabi-
lise the grid, ensuring it continues
to operate close to 50 hertz (cycles
per second).
The battery will respond in less
than one second to any devia-
tion and RES group business de-
velopment director Rob Sauven
describes how the system works.
“Connected to the transmission
system, storage can inject and suck
energy in and out of the grid to
stabilise it during periods of rapid
change of demand or generation.
When connected to distribution,
it can support a congested part of
the grid such as a substation. This
removes the need to invest in up-
grading,” he explains.
Greater grid efficiency could
cut costs all round. If savings are
passed on to small businesses and
especially homeowners, storage
should put money back in consum-
ers’ pockets, argues Joe Warren,
managing director of Powervault,
the UK’s first fully integrated home
energy storage system provider. He
says: “Storage is predicted to cre-
ate billions of pounds of value to
the UK energy system – contracts
like EFR will realise potential by
ensuring the value flows back to
those who invest.”
Powervault has just launched
its second-generation products
and closed its third Crowdcube
fundraising, overfunded to more
than £1.3 million. For Mr War-
ren, storage is the missing piece
of the puzzle for renewables in
a post-subsidy world. “The way
forward for the home renewables
market is to deliver smart bundles
of products which maximise sav-
ings and make life easy for con-
sumers. We’ve already bundled
our product with solar panels and
LED lights to deliver maximum
value,” he says. “We believe that
energy storage will become as
commonplace as a dishwasher in
the home.”
While we may not all become bil-
lionaires like Bill Gates, storage
might still promise to make us at
least a little energy richer.
Share this article online via
raconteur.net
RACONTEUR xx xx / 2016
14 / 06 xxxx raconteur.net XXXX
POWERING THE FUTURE 2
13
COMMERCIAL FEATURE
INTEGRATING ENERGY MANAGEMENT
AND PROCUREMENT SERVICES
With energy commodity prices at their lowest for nearly a decade, what should businesses be doing to take advantage?
Conversely, non-commodity charges – 56 per cent of electricity and 32 per cent of gas costs – are at an all-time high, so how
should businesses limit their impact?
CURRENT MARKET CONDITIONS Energy, we believe that a choice of
Energy commodity prices hit their suppliers is imperative for increased
lowest point at the turn of the year competition and our frameworks
BREAKDOWN OF ELECTRICITY PRICES
following the reduction in oil prices cater for this.
and have since risen with increased 1% 1%
volatility. Weaker sterling, unplanned OUTSOURCING Transmission losses Supplier charges
system maintenance, sooner than UTILITIES MANAGEMENT
expected coal plant closures and a In addition to lowering costs through 2% 1%
rise in oil prices have all fed into price energy procurement, savings can also be Contracts for difference Capacity market
increases in the short and long term. made by fully validating utility invoices,
At STC Energy, part of Inspired streamlining invoice management and
2% 1%
BSUoS Elexon/AAHEDC
Energy plc, we encouraged our accounts payable processes. Since
customers, who were risk averse, 2005, STC has recovered more than
4%
to forward purchase their energy £142 million-worth of utility billing
contracts during this nine-year low errors for its clients.
Distribution losses
point. Those who renewed on fixed- While bureau services create many 5% AVOIDING PEAK TIMES
price contracts have benefited by intrinsic benefits, they also generate Feed-in tariff With the introduction of the capacity
securing price certainty for their direct cost-saving opportunities. market, reducing energy usage during
entire contract. Customers that By employing a dedicated provider, 6% peak times is crucial. Our analysis of
are less risk averse and chose a businesses will be able to identify Climate profile data can assist with identifying
flexible pass-through contract will all billing errors and ensure that all change levy periods of consumption that could be
still benefit from periods of low raw overcharges are correctly refunded, 44% reduced during peak times. Peak times
6% Wholesale
energy costs, but could be exposed thus saving money by outsourcing are typically 4pm to 7pm, Monday
electricity cost
to some price volatility. utilities management. Transmission to Friday business days between
use of system November and February. However,
EXPLORING THE MARKET KNOWING YOUR PORTFOLIO 13% peak times can vary by region.
With supplier costs typically The first port of call is to establish Distribution
representing 1 to 3 per cent of the exactly the scope of the energy and use of system STAYING COMPLIANT
final delivered energy spend, it makes water portfolio, and create a cleansed 14% Although the CRC energy efficiency
sense to shop around and explore database of all utility supply points. This Renewables scheme is nearing its demise in 2019,
obligation
the whole market. We would always in itself can highlight opportunities annual returns and audits will still be
recommend a full market tender to for savings, such as identifying non- required. Savings can be made by
the whole market, not just the big six. consolidated supplies billed on default ensuring that estimated invoices are
Results are then evaluated on cost or out-of-contract rates. kept to a minimum by using profile
and product functionality with a firm data and automatic or self-read meter
recommendation provided in line with ONLY PAYING FOR WHAT YOU USE Source: STC Energy readings. This will save an uplift of
the customers’ requirements. Utility suppliers’ contracts and 10 per cent on estimated data when
The majority of flexible invoices can be very complex and purchasing allowances.
procurement frameworks only offer difficult to understand. As a result it is be missed by customers. With flexible payable files and loaded directly into ABOVE RIGHT
one energy supplier; however, at STC inevitable that some billing errors will and energy-only contracts becoming accounting software. This process Alan Little Finally, like any commodity market,
Business develop-
a more popular way of buying energy, further reduces the time internal wholesale energy prices can go up and
ment manager
additional validation is required to staff spend processing invoices and down having an impact on costs. So cost
STC Energy
Source: STC Energy balance reconciliation statements also ensures duplicate or incorrect difference between supplier offers is
BRENT OIL PRICES
from suppliers and check the growing payments are eliminated. not only due to supplier and consultant
JULY 2014 to JUNE 2016, $ per barrel
number of third-party charges. margins, but also product type and
In STC’s experience, between 3 and HIGHLIGHTING WASTAGE structure. Innovative product ranges,
120 5 per cent of utility expenditure can To combat energy waste and other procurement solutions and added-
be saved by fully validating supplier exceptional consumption, STC value services have become more vital
invoices. Further savings can also be recommends setting consumption in today’s competitive market. The
100 achieved by reducing time spent by targets and undertaking proactive energy market can be complicated, but
internal staff dealing with utility issues. monitoring of individual supplies using with the right energy partner it can be
80
This type of saving can often outweigh traffic-light reporting and profile much easier to navigate.
the cost of an energy bureau service, alerts. Dedicated software can form a Using a third-party intermediary,
which should equate to less than 0.5 picture of a site’s consumption profile, further savings can be achieved by
60 per cent of total utility expenditure. which is then automatically monitored implementing some or all of these
for exceptions. Any deviations trigger recommendations.
FASTER SOLUTIONS, an e-mail alert and can be viewed on If you would like to find out more
40
ACCURATE RESULTS map-based site exception dashboards. about how STC Energy can help you,
Switching from paper to electronic Reports quickly highlight which sites get in touch today.
20 billing and using a system that can are over target, allowing for fast
import and validate invoice files corrective action. For solutions and services that work
provides a much more efficient way of Profile alerts are very successful in use STC Energy
processing utility invoices. Validated identifying energy waste directly and Call us on 0208 466 2915
Jul 14
Aug 14
Sep 14
Oct 14
Nov 14
Dec 14
Jan 15
Feb 15
Mar 15
Apr 15
May 15
Jun 15
Jul 15
Aug 15
Sep 15
Oct 15
Nov 15
Dec 15
Jan 16
Feb 16
Mar 16
Apr 16
May 16
Jun 16
invoices can be automatically in suggesting behavioural changes that E-mail us on info@stcenergy.com
compiled into consolidated accounts can be implemented to reduce wastage. www.stcenergy.com
12 POWERING THE FUTURE
ENERGY STORAGE
JIM M c CLELLAND
W
hat do you get the
business mogul who
has everything?
Strangely enough,
the answer is somewhat less
exotic than you might expect – en-
ergy storage.
The new Breakthrough Energy
Coalition has declared storage an
investment and innovation pri-
ority. Spearheaded by Bill Gates,
this billionaires’ coalition boasts a
stellar roster of backers, including
Jeff Bezos of Amazon, Mark Zuck-
erberg of Facebook plus Sir Richard
Branson. Not surprisingly, the mar-
ket approves.
According to IHS Technology,
grid-connected energy storage is
set to explode, with annual instal-
lations forecast in excess of 6 giga-
watts in 2017, then skyrocketing
up to more than 40GW by 2022.
The final quarter of 2015 alone
showed a 45 per cent increase in
the global pipeline. Storage is big
and hot.
Storage is also diverse. In North-
ern Ireland, Gaelectric is using €6.5
million of European Union funding
to convert excess energy from renew-
ables into compressed air to store in
salt caverns, almost a mile under-
ground, along the Antrim coast. Its
compressed air energy storage at
Larne will provide 330 megawatts of
power for up to six hours.
By contrast, a $55-million 50MW
facility planned for the Nevada
Desert features a train. Advanced
rail energy storage moves millions
of pounds of mass uphill against
gravity on railroad shuttles. This
process can store enough energy
to power a medium-sized city for
hours, when the train comes back
down the track.
For UK home and business mar-
kets, though, the technology that
figures most in the present energy
debate is battery storage for electric
cars and microgeneration. Entre-
preneur Elon Musk even provides
a certain celebrity sparkle as his
premium electric car brand Tesla
pumps the media profile of its home
battery product Powerwall. Storage
is sexy, almost.
Taking a systemic view of UK
capacity, the Investing in UK Elec-
CASE STUDY: RASA HYDROGEN CAR
This February, a pioneering
Welsh company launched
a clean and green road
machine with a difference
– hydrogen.
Batteries are included
in this game-changer
Storing energy is transforming the UK power market,
changing home and business consumers’ relationship with
consumption while offering the potential to slash bills
GLOBAL INSTALLED DISTRIBUTED ENERGY STORAGE SYSTEMS FORECAST (MW)
14,000 Commercial
Residential
12,000
Community
10,000
8,000
6,000
4,000
2,000
0
2014 2015 2016
Designed from scratch,
Riversimple’s two-seater
Rasa is billed as the most
efficient car in the world for
ordinary road-going use.
With no tailpipe emissions
but water, the hydrogen-
powered FCEV (fuel cell
electric vehicle) refuels in
just three minutes, for
300 miles.
Adding to six-figure EU,
Welsh and UK government
backing, crowdfunding
investors can now take a
2017 2018 2019
stake in the project and a
technology market is up
for grabs, says Riversimple
founder Hugo Spowers.
“Hydrogen cars and
infrastructure are a great
opportunity for the UK to
re-establish leadership in
the car of the future. We
have better skills – and
more of them.”
Available in 2018 through
a unique sale-of-service
model – where customers
pay a fixed monthly
raconteur.net
2020 2021 2022 2023 2024
Source: Navigant Research 2015
amount to cover all costs,
including fuel – the Rasa is
revolutionary, concludes
Dave Hampton, carbon
coach and radio presenter.
He says: “Everything
must change, starting
with how we think. And
Riversimple have rethought
everything – the entire
automotive personal-
mobility dream. The Rasa
is tomorrow’s disruptive
technology on the
road today.”
tricity Storage report by Eunomia
Research & Consulting provides
the first dedicated market fore-
casts. From a relatively low start
point of just over 26MW of capac-
ity spread across 24 sites, find-
ings predict exponential year-on-
year growth to more than 1.6GW
in 2020.
According to principal author
Chloe Bines, the real step-change
anticipated is when National Grid
enhanced frequency response
(EFR) contracts come online in
2017. “We expect to see a number
of battery projects successfully se-
curing contracts as a result of the
EFR tender,” she says. “That’s im-
portant because it helps improve
investor confidence.”
This will benefit both the industry
and its customers, Ms Bines adds.
“EFR is a new way that ‘behind the
meter’ storage can save businesses
money. Not only do they avoid peak
electricity costs, but they can also
make an income from storage while
helping make the grid more resil-
ient,” she says.
Storage can also increase
self-consumption of residential
solar, and the market is excited
about prospects for smart tariffs
and meters to help reduce home-
owners’ bills. Although Ms Bines
tempers this optimism with a note
of caution. “If we’re going to see
residential energy storage take off,
it will depend on time-of-use tar-
iffs becoming available. A differ-
ential between peak and off-peak
14 / 06 / 2016 RACONTEUR
For UK home and
business markets,
the technology
that figures most is
battery storage for
electric cars
and microgeneration
pricing means there’s opportunity
to make a saving through storage,
but it would need to be significant
to become economic at this small
scale,” she says.
In an influential deal struck in
advance of the EFR, National Grid
has signed a four-year contract
with Renewable Energy Systems
(RES) to provide 20MW of frequen-
cy response from battery storage.
The project will prove the effec-
tiveness of storage to act to stabi-
lise the grid, ensuring it continues
to operate close to 50 hertz (cycles
per second).
The battery will respond in less
than one second to any devia-
tion and RES group business de-
velopment director Rob Sauven
describes how the system works.
“Connected to the transmission
system, storage can inject and suck
energy in and out of the grid to
stabilise it during periods of rapid
change of demand or generation.
When connected to distribution,
it can support a congested part of
the grid such as a substation. This
removes the need to invest in up-
grading,” he explains.
Greater grid efficiency could
cut costs all round. If savings are
passed on to small businesses and
especially homeowners, storage
should put money back in consum-
ers’ pockets, argues Joe Warren,
managing director of Powervault,
the UK’s first fully integrated home
energy storage system provider. He
says: “Storage is predicted to cre-
ate billions of pounds of value to
the UK energy system – contracts
like EFR will realise potential by
ensuring the value flows back to
those who invest.”
Powervault has just launched
its second-generation products
and closed its third Crowdcube
fundraising, overfunded to more
than £1.3 million. For Mr War-
ren, storage is the missing piece
of the puzzle for renewables in
a post-subsidy world. “The way
forward for the home renewables
market is to deliver smart bundles
of products which maximise sav-
ings and make life easy for con-
sumers. We’ve already bundled
our product with solar panels and
LED lights to deliver maximum
value,” he says. “We believe that
energy storage will become as
commonplace as a dishwasher in
the home.”
While we may not all become bil-
lionaires like Bill Gates, storage
might still promise to make us at
least a little energy richer.
Share this article online via
raconteur.net
RACONTEUR xx xx / 2016
14 / 06 xxxx raconteur.net XXXX
POWERING THE FUTURE 2
13
COMMERCIAL FEATURE
INTEGRATING ENERGY MANAGEMENT
AND PROCUREMENT SERVICES
With energy commodity prices at their lowest for nearly a decade, what should businesses be doing to take advantage?
Conversely, non-commodity charges – 56 per cent of electricity and 32 per cent of gas costs – are at an all-time high, so how
should businesses limit their impact?
CURRENT MARKET CONDITIONS Energy, we believe that a choice of
Energy commodity prices hit their suppliers is imperative for increased
lowest point at the turn of the year competition and our frameworks
BREAKDOWN OF ELECTRICITY PRICES
following the reduction in oil prices cater for this.
and have since risen with increased 1% 1%
volatility. Weaker sterling, unplanned OUTSOURCING Transmission losses Supplier charges
system maintenance, sooner than UTILITIES MANAGEMENT
expected coal plant closures and a In addition to lowering costs through 2% 1%
rise in oil prices have all fed into price energy procurement, savings can also be Contracts for difference Capacity market
increases in the short and long term. made by fully validating utility invoices,
At STC Energy, part of Inspired streamlining invoice management and
2% 1%
BSUoS Elexon/AAHEDC
Energy plc, we encouraged our accounts payable processes. Since
customers, who were risk averse, 2005, STC has recovered more than
4%
to forward purchase their energy £142 million-worth of utility billing
contracts during this nine-year low errors for its clients.
Distribution losses
point. Those who renewed on fixed- While bureau services create many 5% AVOIDING PEAK TIMES
price contracts have benefited by intrinsic benefits, they also generate Feed-in tariff With the introduction of the capacity
securing price certainty for their direct cost-saving opportunities. market, reducing energy usage during
entire contract. Customers that By employing a dedicated provider, 6% peak times is crucial. Our analysis of
are less risk averse and chose a businesses will be able to identify Climate profile data can assist with identifying
flexible pass-through contract will all billing errors and ensure that all change levy periods of consumption that could be
still benefit from periods of low raw overcharges are correctly refunded, 44% reduced during peak times. Peak times
6% Wholesale
energy costs, but could be exposed thus saving money by outsourcing are typically 4pm to 7pm, Monday
electricity cost
to some price volatility. utilities management. Transmission to Friday business days between
use of system November and February. However,
EXPLORING THE MARKET KNOWING YOUR PORTFOLIO 13% peak times can vary by region.
With supplier costs typically The first port of call is to establish Distribution
representing 1 to 3 per cent of the exactly the scope of the energy and use of system STAYING COMPLIANT
final delivered energy spend, it makes water portfolio, and create a cleansed 14% Although the CRC energy efficiency
sense to shop around and explore database of all utility supply points. This Renewables scheme is nearing its demise in 2019,
obligation
the whole market. We would always in itself can highlight opportunities annual returns and audits will still be
recommend a full market tender to for savings, such as identifying non- required. Savings can be made by
the whole market, not just the big six. consolidated supplies billed on default ensuring that estimated invoices are
Results are then evaluated on cost or out-of-contract rates. kept to a minimum by using profile
and product functionality with a firm data and automatic or self-read meter
recommendation provided in line with ONLY PAYING FOR WHAT YOU USE Source: STC Energy readings. This will save an uplift of
the customers’ requirements. Utility suppliers’ contracts and 10 per cent on estimated data when
The majority of flexible invoices can be very complex and purchasing allowances.
procurement frameworks only offer difficult to understand. As a result it is be missed by customers. With flexible payable files and loaded directly into ABOVE RIGHT
one energy supplier; however, at STC inevitable that some billing errors will and energy-only contracts becoming accounting software. This process Alan Little Finally, like any commodity market,
Business develop-
a more popular way of buying energy, further reduces the time internal wholesale energy prices can go up and
ment manager
additional validation is required to staff spend processing invoices and down having an impact on costs. So cost
STC Energy
Source: STC Energy balance reconciliation statements also ensures duplicate or incorrect difference between supplier offers is
BRENT OIL PRICES
from suppliers and check the growing payments are eliminated. not only due to supplier and consultant
JULY 2014 to JUNE 2016, $ per barrel
number of third-party charges. margins, but also product type and
In STC’s experience, between 3 and HIGHLIGHTING WASTAGE structure. Innovative product ranges,
120 5 per cent of utility expenditure can To combat energy waste and other procurement solutions and added-
be saved by fully validating supplier exceptional consumption, STC value services have become more vital
invoices. Further savings can also be recommends setting consumption in today’s competitive market. The
100 achieved by reducing time spent by targets and undertaking proactive energy market can be complicated, but
internal staff dealing with utility issues. monitoring of individual supplies using with the right energy partner it can be
80
This type of saving can often outweigh traffic-light reporting and profile much easier to navigate.
the cost of an energy bureau service, alerts. Dedicated software can form a Using a third-party intermediary,
which should equate to less than 0.5 picture of a site’s consumption profile, further savings can be achieved by
60 per cent of total utility expenditure. which is then automatically monitored implementing some or all of these
for exceptions. Any deviations trigger recommendations.
FASTER SOLUTIONS, an e-mail alert and can be viewed on If you would like to find out more
40
ACCURATE RESULTS map-based site exception dashboards. about how STC Energy can help you,
Switching from paper to electronic Reports quickly highlight which sites get in touch today.
20 billing and using a system that can are over target, allowing for fast
import and validate invoice files corrective action. For solutions and services that work
provides a much more efficient way of Profile alerts are very successful in use STC Energy
processing utility invoices. Validated identifying energy waste directly and Call us on 0208 466 2915
Jul 14
Aug 14
Sep 14
Oct 14
Nov 14
Dec 14
Jan 15
Feb 15
Mar 15
Apr 15
May 15
Jun 15
Jul 15
Aug 15
Sep 15
Oct 15
Nov 15
Dec 15
Jan 16
Feb 16
Mar 16
Apr 16
May 16
Jun 16
invoices can be automatically in suggesting behavioural changes that E-mail us on info@stcenergy.com
compiled into consolidated accounts can be implemented to reduce wastage. www.stcenergy.com
14 POWERING THE FUTURE raconteur.net 14 / 06 / 2016 RACONTEUR RACONTEUR 14 / 06 / 2016 raconteur.net POWERING THE FUTURE 15

Msheireb Properties
Cities must be

Getty Images
smartened up
to save energy
Cities where technology measures and manages
the use of green energy are a smart step towards
sustainability in the 21st century

SMART CITIES what you cannot measure. This is true

CELESTINE CHEONG of energy management and genera-
tion. Everything must be connected.

S
mart can mean a connection
to an ecosystem of devices,
software and services. With
smart cities, the internet
of things – devices that collect and
transmit data via the internet – will
make cities more energy efficient.
Each smart city concept is dif-
ferent. There’s the ambitious pro-
jects to build shiny new things
on green fields or in the desert,
all hooked up to anything digital.
Or there’s the challenge of retro-
fitting technology in established
cities to make them more dynam-
ic places. In all cases, technology
aims to manage the urban environ-
However, Richard Kirkman, Veo-
lia’s technical director, does not be-
lieve there is a city that exists where
a single unified monitoring system
has been deployed. It is done in si-
los and by different organisations.
“No one really controls everything
at the same time. They have always
devolved to be handled by separate
organisations. The collaboration of 04
investment in networks is the next
evolutionary step for smart cities,”
he says.
Yet this might happen in Singapore. 02 3,500
Forced towards digital technology
because of its geographical restric-
tions and dense population, in 2014 presentation and aesthetics were all approach to smart cities with the
its government launched Smart Na- considered with the traditional Qatari most basic of internet of things sen-
Getty Images

ment better.
One of the more renowned smart
cities is Masdar in Abu Dhabi. It is
built on a raised platform where wa-
ter pipes with sensors and a fibre op-
tic network sit below. Above ground,
it features driverless cars and ener-
gy-efficient buildings with cooling
technologies to resist the scorching
heat. Initiated in 2006 as the world’s
first planned sustainable city, Mas-
dar was touted as a model for a green
mixed-urban landscape and global
hub for the clean tech industry.
However, a decade on only a frac-
tion of the town has been built. In-
stead of its 45,000 planned homes,
there are just 300 students living
on the site. Held back by the recent
world economic crisis, and a lack of
businesses and people who want to
live there, its completion date was
this year pushed back to 2030. But
tion, a programme that will see an in mind”. sory technology and metering being
3,000
undetermined number of sensors and So perhaps the more successful The collaboration installed to monitor water, energy
cameras deployed across the island 01 smart cities will be those that have and waste. The algorithms and tools
state. Everything from the flushing grown organically, with a top-
of investment in to mine the data being collected will
of toilets to the precise movement of down and bottom-up approach, networks is the next also evolve.
every locally registered vehicle will be smart city is still an aspiration. 01
Reflective panels
putting people’s needs and aspira- evolutionary step
monitored in real time. “This isn’t a big surprise. While situated over solar tions first.
for smart cities Share this article online via
2,500
Dassault Systèmes’ John Stokoe, cross-industry collaboration has panels in Masdar Within the next ten to fifteen years, raconteur.net
head of strategic business devel- promoted truly radical innova- we are likely to see a phased project
opment, who is building a 3D plat- tions, bridging the differing tech- 02
Artist’s illustra-
form in the cloud to manage the nical languages, regulations, pro-
tion of Msheireb,
environment, says: “Integrated cedural norms and complex value Qatar, a new smart
and accurate data is the founda- chains is difficult. city that is pre-
tion of sustainability.” “Civil engineers plan, design and serving existing NUMBER OF CONNECTED DEVICES IN SMART CITIES (M)
heritage sites 2,000
build the physical urban environ- Smart commercial buildings Transport Utilities
ment. To achieve our goal of creat- 03
ing evermore sustainable, attractive Smart homes Public services Others Healthcare
Driverless electric
and efficient cities where people pod in Masdar to
want to live, we need to better un- transport students
from parking areas
derstand and embrace computer to the university 1,500
sciences, and work across wider do- campus
mains to leverage the opportunities
$1.39 trn offered by technology.” 04
Getty Images

not all smart cities are like Masdar.
Asked how a successful smart
city can be built from scratch, Neil
Thompson, who leads the Construc-
tion Industry Council’s BIM2050
(Building Information Modelling)
digital integration task group, says:
“To have a master plan of the future,
we are bounded by today’s technolo-
gy. There is no point putting in fancy
technology for the sake of doing so. We
need to know what problems need to
be solved. Knowing what the design
outcomes are to make a city ‘smart’ is
a first step.”
These might include the manage-
ment of air quality, waste, water con-
sumption, transportation and noise
pollution. But you cannot manage
estimated value of the
global smart city market by
2020, up from $387 billion
in 2014
Source:
Mordor Intelligence 2015
Given some of the complexities
involved, are smart cities still an
aspiration rather than a reality?
Andrew Comer, fellow of the Insti-
tution of Civil Engineers, says of the
link between the technology and
construction industry: “It’s taken
the technology industry a long time
to grasp the complexity of the real
estate and construction industry,
and is one of the reasons that the
One of the biggest barriers of all
is not the technology itself; it is
people. In June 2015, India’s prime
minister Narendra Modi launched
a national competition to find
the best smart city proposal, with
funding for phased development.
Mott MacDonald’s Anne Kerr,
who worked on the proposed plans
to regenerate the historic city of
Jaipur in Rajasthan, says: “The
greatest challenge was to hear, cap-
ture, and interpret the needs and
aspirations of Jaipur’s citizens; an
exercise requiring widespread and
detailed community outreach and
stakeholder communication.”
Schneider Electric’s director of
smart city development Gordon
Wind tower in
Masdar, designed
to circulate cool
air downwards 03
through walkways
Falconer points out another social
issue. “One of the biggest barriers to
realising the potential of smart cit-
ies is culture. We have the technolo-
gy in abundance, but we need to do
more to educate councils, industry,
businesses and the wider commu-
nity about the transformational po-
tential of a truly smart city,” he says.
The United Arab Emirates has
since applied the wisdom of lessons
learnt from Masdar. This can be
seen in Msheireb, the world’s largest
regeneration project in Doha, Qatar.
1,000
Tackling the issue of culture early in
its plans, Msheireb’s architectural
designs are built on the principles
of preserving existing heritage sites.
According to Carl Castellino, director 500
of facilities management at Msheireb
Properties: “It prioritises culture for
the Qataris. It makes sure it is a fu-
turistic city while echoing the past.”
He adds that apart from having the
largest concentration of LEED (Lead- 0
ership in Energy and Environmen-
2015 2016 2017 2018
tal Design) certified buildings in the
world, “the patterns, the colours, the Source: Gartner 2015
14 POWERING THE FUTURE raconteur.net 14 / 06 / 2016 RACONTEUR RACONTEUR 14 / 06 / 2016 raconteur.net POWERING THE FUTURE 15

Msheireb Properties
Cities must be

Getty Images
smartened up
to save energy
Cities where technology measures and manages
the use of green energy are a smart step towards
sustainability in the 21st century

SMART CITIES what you cannot measure. This is true

CELESTINE CHEONG of energy management and genera-
tion. Everything must be connected.

S
mart can mean a connection
to an ecosystem of devices,
software and services. With
smart cities, the internet
of things – devices that collect and
transmit data via the internet – will
make cities more energy efficient.
Each smart city concept is dif-
ferent. There’s the ambitious pro-
jects to build shiny new things
on green fields or in the desert,
all hooked up to anything digital.
Or there’s the challenge of retro-
fitting technology in established
cities to make them more dynam-
ic places. In all cases, technology
aims to manage the urban environ-
However, Richard Kirkman, Veo-
lia’s technical director, does not be-
lieve there is a city that exists where
a single unified monitoring system
has been deployed. It is done in si-
los and by different organisations.
“No one really controls everything
at the same time. They have always
devolved to be handled by separate
organisations. The collaboration of 04
investment in networks is the next
evolutionary step for smart cities,”
he says.
Yet this might happen in Singapore. 02 3,500
Forced towards digital technology
because of its geographical restric-
tions and dense population, in 2014 presentation and aesthetics were all approach to smart cities with the
its government launched Smart Na- considered with the traditional Qatari most basic of internet of things sen-
Getty Images

ment better.
One of the more renowned smart
cities is Masdar in Abu Dhabi. It is
built on a raised platform where wa-
ter pipes with sensors and a fibre op-
tic network sit below. Above ground,
it features driverless cars and ener-
gy-efficient buildings with cooling
technologies to resist the scorching
heat. Initiated in 2006 as the world’s
first planned sustainable city, Mas-
dar was touted as a model for a green
mixed-urban landscape and global
hub for the clean tech industry.
However, a decade on only a frac-
tion of the town has been built. In-
stead of its 45,000 planned homes,
there are just 300 students living
on the site. Held back by the recent
world economic crisis, and a lack of
businesses and people who want to
live there, its completion date was
this year pushed back to 2030. But
tion, a programme that will see an in mind”. sory technology and metering being
3,000
undetermined number of sensors and So perhaps the more successful The collaboration installed to monitor water, energy
cameras deployed across the island 01 smart cities will be those that have and waste. The algorithms and tools
state. Everything from the flushing grown organically, with a top-
of investment in to mine the data being collected will
of toilets to the precise movement of down and bottom-up approach, networks is the next also evolve.
every locally registered vehicle will be smart city is still an aspiration. 01
Reflective panels
putting people’s needs and aspira- evolutionary step
monitored in real time. “This isn’t a big surprise. While situated over solar tions first.
for smart cities Share this article online via
2,500
Dassault Systèmes’ John Stokoe, cross-industry collaboration has panels in Masdar Within the next ten to fifteen years, raconteur.net
head of strategic business devel- promoted truly radical innova- we are likely to see a phased project
opment, who is building a 3D plat- tions, bridging the differing tech- 02
Artist’s illustra-
form in the cloud to manage the nical languages, regulations, pro-
tion of Msheireb,
environment, says: “Integrated cedural norms and complex value Qatar, a new smart
and accurate data is the founda- chains is difficult. city that is pre-
tion of sustainability.” “Civil engineers plan, design and serving existing NUMBER OF CONNECTED DEVICES IN SMART CITIES (M)
heritage sites 2,000
build the physical urban environ- Smart commercial buildings Transport Utilities
ment. To achieve our goal of creat- 03
ing evermore sustainable, attractive Smart homes Public services Others Healthcare
Driverless electric
and efficient cities where people pod in Masdar to
want to live, we need to better un- transport students
from parking areas
derstand and embrace computer to the university 1,500
sciences, and work across wider do- campus
mains to leverage the opportunities
$1.39 trn offered by technology.” 04
Getty Images

not all smart cities are like Masdar.
Asked how a successful smart
city can be built from scratch, Neil
Thompson, who leads the Construc-
tion Industry Council’s BIM2050
(Building Information Modelling)
digital integration task group, says:
“To have a master plan of the future,
we are bounded by today’s technolo-
gy. There is no point putting in fancy
technology for the sake of doing so. We
need to know what problems need to
be solved. Knowing what the design
outcomes are to make a city ‘smart’ is
a first step.”
These might include the manage-
ment of air quality, waste, water con-
sumption, transportation and noise
pollution. But you cannot manage
estimated value of the
global smart city market by
2020, up from $387 billion
in 2014
Source:
Mordor Intelligence 2015
Given some of the complexities
involved, are smart cities still an
aspiration rather than a reality?
Andrew Comer, fellow of the Insti-
tution of Civil Engineers, says of the
link between the technology and
construction industry: “It’s taken
the technology industry a long time
to grasp the complexity of the real
estate and construction industry,
and is one of the reasons that the
One of the biggest barriers of all
is not the technology itself; it is
people. In June 2015, India’s prime
minister Narendra Modi launched
a national competition to find
the best smart city proposal, with
funding for phased development.
Mott MacDonald’s Anne Kerr,
who worked on the proposed plans
to regenerate the historic city of
Jaipur in Rajasthan, says: “The
greatest challenge was to hear, cap-
ture, and interpret the needs and
aspirations of Jaipur’s citizens; an
exercise requiring widespread and
detailed community outreach and
stakeholder communication.”
Schneider Electric’s director of
smart city development Gordon
Wind tower in
Masdar, designed
to circulate cool
air downwards 03
through walkways
Falconer points out another social
issue. “One of the biggest barriers to
realising the potential of smart cit-
ies is culture. We have the technolo-
gy in abundance, but we need to do
more to educate councils, industry,
businesses and the wider commu-
nity about the transformational po-
tential of a truly smart city,” he says.
The United Arab Emirates has
since applied the wisdom of lessons
learnt from Masdar. This can be
seen in Msheireb, the world’s largest
regeneration project in Doha, Qatar.
1,000
Tackling the issue of culture early in
its plans, Msheireb’s architectural
designs are built on the principles
of preserving existing heritage sites.
According to Carl Castellino, director 500
of facilities management at Msheireb
Properties: “It prioritises culture for
the Qataris. It makes sure it is a fu-
turistic city while echoing the past.”
He adds that apart from having the
largest concentration of LEED (Lead- 0
ership in Energy and Environmen-
2015 2016 2017 2018
tal Design) certified buildings in the
world, “the patterns, the colours, the Source: Gartner 2015
 Distributed in

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