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Smart Grid Deployment Framework in the EU –                       How ICT Vendors Can Benefit from Regulatory Changes     ...
Today’s Presenter                  Ewa Tajer, Research Analyst                  Frost & Sullivan•   5 years experience in ...
Focus Points1.   EU Energy Policy:     •   Authorities’ Perspective     •   Regulatory Framework for Smart Grid     •   En...
EU Energy Policy: Authorities’ Perspective             Renewable Energy Sources (RES)                                     ...
Poll QuestionWhich smart grid technology has enjoyed so far the greatest interest of EUregulators?1.   E-vehicles2.   Smar...
Regulatory Framework for Smart Grid                                                     Smart metering                    ...
EU Energy Policy: Energy Companies’ Perspectives               Problems To Be Addressed                                   ...
EU Energy Policy: Energy Companies’ Investment Needs     • Outage management                                              ...
Poll QuestionWhat is the main regulatory obstacle to developing smart grid?1.   Lack of minimum functional standards2.   T...
Main regulatory challenges            Technology                   Customer acceptance                 Business model   • ...
Utilities’ Investment Scope: Country Overview            United Kingdom                                  Sweden   • Renewa...
Summary of Regulatory Challenges      The legal framework for smart grid and smart metering remains incomplete and does no...
Energy system transformation: Key Take-Aways 1   EU regulations as an important driver for smart grid, especially grid bal...
Next StepsDevelop Your Visionary and Innovative Skills       Growth Partnership Service                      Share your gr...
Your Feedback is Important to Us          What would you like to see from Frost & Sullivan?Growth Forecasts?Competitive St...
Follow Frost & Sullivan on Facebook, LinkedIn,SlideShare, and Twitter            http://www.facebook.com/FrostandSullivan ...
For Additional InformationJoanna Lewandowska             Ewa TajerCorporate Communications       Research AnalystICT      ...
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Frost & Sullivan Briefing: Smart Grid Deployment Framework in the EU -How ICT Vendors Can Benefit from Regulatory Changes

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Transcript of "Frost & Sullivan Briefing: Smart Grid Deployment Framework in the EU -How ICT Vendors Can Benefit from Regulatory Changes"

  1. 1. Smart Grid Deployment Framework in the EU – How ICT Vendors Can Benefit from Regulatory Changes Ewa Tajer, Research Analyst ICT 27th November 2012© 2012 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property ofFrost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.
  2. 2. Today’s Presenter Ewa Tajer, Research Analyst Frost & Sullivan• 5 years experience in Energy and Environment with special focus on • Smart grid and smart metering • Renewable energy • Energy efficiency• 4 years primary and secondary research expertise gained in both public and private sector, particularly in: • Existing policy and legal framework analyses • Competitive environment monitoring and analyses 2
  3. 3. Focus Points1. EU Energy Policy: • Authorities’ Perspective • Regulatory Framework for Smart Grid • Energy Companies’ Perspectives • Energy Companies’ Investment Needs2. Main Regulatory Challenges3. Country Overview4. Conclusions • Summary of Regulatory Challenges • Energy System Transformation: Key Take-Aways 3
  4. 4. EU Energy Policy: Authorities’ Perspective Renewable Energy Sources (RES) Security Of Supply Increase Development The Current Energy Efficiency Improvement Energy Policy Reduction Of Dependency On Imports of the EU Reduction of Greenhouse Gas (GHG) Addressing the Growing Energy Demand (2020 targets) Emissions 20% Reduction in GHG 20% Reduction in Primary Energy 20%Share of RES Emissions* Use Smart grids have been recognised as a solution facilitating 20-20-20 goal achievement. (Smart Grid—An upgraded energy network to which two-way digital communication between the supplier and consumer, smart metering and monitoring, and control systems have been added.) Smart grid implementation will Possible output fluctuations have Smart grid implementation will be result in global emissions to be balanced through advanced followed by primary energy decreases of 15% low-voltage automatic. consumption reduction in the EU by 9%. * Compared to 1990 levels Source: European Commission ,Frost & Sullivan analysis.9845-63 4
  5. 5. Poll QuestionWhich smart grid technology has enjoyed so far the greatest interest of EUregulators?1. E-vehicles2. Smart metering3. Customer billing4. Load fluctuation balancing5. Smart homes 5
  6. 6. Regulatory Framework for Smart Grid Smart metering • Metering reflecting actual energy consumption and time of use (if it is technically Directive 2006/32/EC possible and economically justified) • Energy bills based on actual energy consumption • Electricity smart meter rollout cost and benefits analysis by 3 September 2012 Directive 2009/72/EC • Timetable for smart meter implementation • Obligatory rollout of electricity smart meters by 2020 • Obligatory assessment of gas smart meter rollout cost and benefits by 3 Directive 2009/73/EC September 2012 • Timetable for implementation (no obligatory timeframe given) Explicit obligation – Obligatory rollout of electricity smart meters Grid automation/ E-vehicles No explicit obligation Grid automation development driven by the changing energy landscape (implicit obligation resulting from the directives 2009/28/WE and the Energy Efficiency Directive) Source: Directive 2006/32/EC; Frost & Sullivan analysis.9845-63 6
  7. 7. EU Energy Policy: Energy Companies’ Perspectives Problems To Be Addressed Possible Solutions Integration of new energy sources and distributed Geographic expansion of the grid generation Trade and energy losses Grid optimisation More Obsolete infrastructure and management systems More More control accurate visibility metering Distributed generation Losses reduction Rising energy demand Changing customer needs Qualitative Energy System Transformation Two-way communication Two-way energy flow Source: Frost & Sullivan analysis.9845-63 7
  8. 8. EU Energy Policy: Energy Companies’ Investment Needs • Outage management • Grid monitoring and control systems • Work force management (especially in the distribution layer) • Fault prevention and Predictive grid • Automatic grid management (Self- maintenance adapting grid) • Fault location and automatic feeder • Virtual Power Plants switching More reliable • Power quality monitoring energy supplies Integration of More renewable and operational decentralized efficiency generation Demand • Asset management for grid management • In-home smart metering systems components • Billing systems for dynamic tariffs • Data analytics for more efficient • Metering data management asset maintenance and investment • Big data transmission and storage planning • Proactive load forecasting • Smart grid cyber security • E-vehicle communication system • Energy theft prevention • In-home power consumption management systems Interconnection and communication between grid elements as basic precondition for grid transformation Operation technologies and ICT synergy as the base of the future business model9845-63 8
  9. 9. Poll QuestionWhat is the main regulatory obstacle to developing smart grid?1. Lack of minimum functional standards2. Technological risk3. Utilities’ business model4. Lack of governmental smart grid strategies 9
  10. 10. Main regulatory challenges Technology Customer acceptance Business model • No binding standards • Lack of knowledge about • Income derived from published yet smart metering benefits regulated tariffs • M/490, M/441, M/468 • Financial Cost Of the • Cost-benefit balance mandates Deployment • Poor state support • Privacy concerns (behavior • Smart meters: • No incentives for innovative patterns) Standards developed at energy technologies • No separate legally binding national level document on metering data development • Grid automation protection issued thus far • Narrow view of cost-efficiency Predominant standard for grid • Poor knowledge about the (smart grid added value not automation used by energy composition of energy prices included) utilities (IEC 61850) and tariffs • Tariff construction Important especially for smart metering and demand management Crucial for all smart energy • Switching from one energy provider to another investment • Answering to price signals Source: Frost & Sullivan analysis.9845-63 10
  11. 11. Utilities’ Investment Scope: Country Overview United Kingdom Sweden • Renewable goal (2020): 15% • Renewable goal (2020): 49% • Energy demand increase: 7% • Energy demand increase: 14% Smart grid focus Smart grid focus Smart metering* Smart metering DSO grid automation DSO grid automation E-vehicles E-vehicles Smart homes Smart homes Germany Poland • Renewable goal (2020): 18% • Renewable goal (2020): 15% • Energy demand increase: (-10%) • Energy demand increase: 12% Smart grid focus Smart grid focus Smart metering Smart metering DSO grid automation DSO grid automation E-vehicles E-vehicles Smart homes Smart homes *Electricity and gas smart meters9845-63 11
  12. 12. Summary of Regulatory Challenges The legal framework for smart grid and smart metering remains incomplete and does not ensure a smooth transition towards a smart energy infrastructure. The most important regulatory challenges are shown below. Regulatory Changes Required for Smart Grid Deployment Minimum Standards for smart functionalities Dedicated data Cyber-security equipment (including for smart privacy and data communication equipment protection protocol) framework Definition of Inclusion of Additional market Fair cost-sharing energy incentives for participants’ model and tariff efficiency in investors roles and regulation energy tariffs responsibilities Source: Frost & Sullivan analysis.9845-63 12
  13. 13. Energy system transformation: Key Take-Aways 1 EU regulations as an important driver for smart grid, especially grid balancing and smart metering. 2 Regulatory framework for smart grid deployment undefined Smart grid usually deployed according to either national (smart meters) or international standards (grid 3 automation) 4 Business model and uneven distribution of costs and benefits as the main restraint 5 Governments do not provide strong support for innovative energy projects 4 Energy utilities need to closely collaborate with ICT suppliers Energy System Operators ICT Companies WHAT ARE THE GOALS? HOW CAN THE GOALS BE ACHIEVED? Energy System Operators to define starting ICT suppliers to provide dedicated solutions and point for the smart grid development process offer constant support 13
  14. 14. Next StepsDevelop Your Visionary and Innovative Skills Growth Partnership Service Share your growth thought leadership and ideas or join our GIL Global Community Join our GIL Community Newsletter Keep abreast of innovative growth opportunities 14
  15. 15. Your Feedback is Important to Us What would you like to see from Frost & Sullivan?Growth Forecasts?Competitive Structure?Emerging Trends?Strategic Recommendations?Other? Please inform us by “Rating” this presentation. 15
  16. 16. Follow Frost & Sullivan on Facebook, LinkedIn,SlideShare, and Twitter http://www.facebook.com/FrostandSullivan http://www.linkedin.com/companies/4506 http://www.slideshare.net/FrostandSullivan http://twitter.com/frost_sullivan 16
  17. 17. For Additional InformationJoanna Lewandowska Ewa TajerCorporate Communications Research AnalystICT ICT+48 22 390 41 46 +48 22 481 62 72joanna.lewandowska@frost.com ewa.tajer@frost.comAdrian Drozd Cyril CromierResearch Director Vice President, SalesICT ICT+44 1865 398 699 +33 1 4281 2244adrian.drozd@frost.com cyril.cromier@frost.com 17
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