The UK’s energy system is undergoing significant changes to provide a reliable, low-carbon future. The integration of renewable and nuclear generation to the traditional energy mix, and the decentralisation and digitalisation of the energy market, so far, are some of the most notable shifts in the sector that are helping this future become a reality.
Critical to balancing these three elements is flexibility. Flexibility represents a range of simple energy solutions (for example, Demand Side Response and storage) that ensure the power we generate and deliver always matches the amount we consume. In other words, it is the point at which a decentralised, decarbonised and digitalised future becomes a practical solution that can deliver real benefits not only to those who contribute to it, but also to the wider economy.
Digitalisation is already improving the efficiency and sustainability of our current energy system. Through monitoring systems like our PowerNow platform, businesses are now better able to understand what they consume down to a single asset level, therefore highlighting new energy saving opportunities.
But digital technologies are set to make energy systems around the world even more intelligent and reliable; identifying who needs energy and delivering it at the lowest cost – the system otherwise known as Demand Side Response (DSR).
Energy usage data has already enabled the grid and its fluctuating energy demands to be supported by businesses that are able to be flexible with their consumption. With a better forecasting of the total amount of energy that will be demanded from the grid at any one point, as well as better understanding of the amount of energy demand which is flexible, businesses that are able to shift or reduce their consumption during times of peak demand are rewarded, either in payment or a reduced energy bill.
But if we are to meet the expected increase in global electricity demand over the next decade, while increasing the share of energy from renewable sources, then flexibility needs to become a priority for more businesses and consumers. Globally, electricity demand is expected to grow by over 20%, with renewable sources expected to make up more than half of the global capacity. If this is the case, the ability of the power system to adapt and flex to the fluctuations in demand will become an integral part of our energy future.
Flexibility is especially important as we move towards a low-carbon future, where intermittent sources such as wind and solar may place a greater stress on the grid’s capacity to match supply to demand.
One area of flexibility that has often been discussed in recent years is the rise of electric vehicles. The uptake of electric vehicles will increasingly place new demands on the grid, difficult to forecast in terms of location and volume – something that will only grow if the government’s target for at least 50 percent of new cars and 40 percent of new vans being electric by 2030 is realised. Yet we already have the technology in place to ease the stress placed on the grid. Energy solutions such as vehicle to grid (V2G) technology, which enables power to be drawn from car batteries and fed back into the grid when not in use, will be vital to support demand.
Given consumers and businesses are playing a more active role in the energy market – shifting from centralised generation towards a decentralised future – flexibility has also had an impact on the traditional relationship between energy providers and consumers.
So where does all of this leave energy providers of the future?
We expect energy providers to deliver an end-to-end approach to energy management; a world in which asset engineering, energy management technologies, and access to wholesale markets are all offered under one roof.
That is why we have engaged in a partnership with UK-based energy technology provider, Upside Energy, and have acquired engineering services firm Imtech, enabling us to carry out this kind of end-to-end proposition to optimise the energy consumption of our customers and partners.
Innovation hubs like our Blue Lab are also playing an important role in helping us continue to drive developments in flexibility technologies. Working with a number of start-ups, we have been able to accelerate the transition to a sustainable, low-carbon society by bringing together the brightest minds in the sector.
It’s undeniable that we are at a very exciting time in the energy sector, where collaboration is providing fantastic opportunities to transform our future relationship with energy for the better.
Only this month we signed a unique deal with Anesco, the UK’s leading energy storage provider, to optimise a combined 16MW of solar and battery assets at their Clayhill solar farm.
Together, we have committed to enhancing the efficiency and profitability of Clayhill’s solar assets, by providing access to the full suite of revenues stack for such assets, through grid services and direct access to wholesale markets. This, together with EDF Energy’s long experience of energy trading, has allowed us to guarantee a minimum remuneration (floor price). We hope that this proves to be a shining example of how cross-industry collaboration can help us to transition to a low-carbon economy in a reliable and profitable way.
Focusing solely on the cost-saving potential of flexibility fails to recognise its greatest potential; it is our gateway to a sustainable, circular economy, where income is generated by turning waste into resource.
Vincent de Rul, Director of Energy Solutions at EDF Energy