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Smart Grid Challenges

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Andreas Sumper
CITCEA-UPC

WORKSHOP: “DEFINING SMART GRIDS: CONDITIONS FOR SUCCESSFUL IMPLEMENTATION”
SESSION 2: SMART GRIDS CHALLENGES: THE VISION OF TECHNOLOGICAL CENTRES
Barcelona, 9th February 2017
Organised by TR@NSENER Consortium.
TR@NSENER - European cooperation Network on Energy Transition in Electricity

Published in: Technology
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Smart Grid Challenges

  1. 1. European cooperation Network on Energy Transition in Electricity Andreas Sumper CITCEA-UPC SESSION 2: SMART GRIDS CHALLENGES: THE VISION OF TECHNOLOGICAL CENTRES WORKSHOP “DEFINING SMART GRIDS: CONDITIONS FOR SUCCESSFUL IMPLEMENTATION” Barcelona, 9th February 2017
  2. 2. 2 Will the electricity system look very different 20 years from now?
  3. 3. 3 Smart, connected products are changing how value is created for customers, how companies compete, and the boundaries of competition itself. These shifts will affect virtually every industry,directly or indirectly. Michael E. Porter and James E. Heppelmann, Harvard Busines Reviews: Is every “thing” now going SMART? • Electricity is a connected product • Smartness is creating a non-commodity • The value is shifting to the customers (Prosumers) • Competition is changing in the electricity sector • The electricity sector is heavily impacted
  4. 4. • The prosumer is inevitably an energy market participant • The prosumer is an economically motivated entity • A potential co-player or an adversary to the establishment • A collection of prosumers can execute significant market power Prosumers
  5. 5. The case for change… … and why it might still not happen Rapidly increasing volatility of electricity markets, creating the need for flexible response of the system A few big infrastructure investments could mitigate volatility – and destroy the business case for alternatives Price differences in 2025 Summer Winter Denmark Norway Denmark Norway Average price (€/MWh) 52.0 50.3 59.1 60.1 Minimum price (€/MWh) 42.9 39.6 46.3 54.8 Maximum price (€/MWh) 57.9 55.6 70.9 64.2 Difference max-min (€/MWh) 15.0 16.1 24.6 9.4 McKinsey 2011
  6. 6. The case for change… … and why it might still not happen Significant value creation from smart grid for all stakeholders – utilities, regulators, customers and equipment vendors Business cases are highly dependent on local specifics and regulatory environment Source: http://facilityexecutive.com/2009/07/power-supply-trends-powering-up/
  7. 7. The case for change… … and why it might still not happen Innovative products and solutions across the whole value chain – many with multiple impact on the overall power system Capturing the value often requires complex partnerships or integrated solution approaches Source: Bremdal, SRG Symposium, Barcelona
  8. 8. The case for change… … and why it might still not happen Attractive business models in the making – opening opportunities for „unorthodox“ coalitions and new players‘ entries Both established and new players might lack sufficient clout and speed to really change the market Smart Grid Smart Home/ Internet of Things Service in the cloud Source: Bremdal, SRG Symposium, Barcelona
  9. 9. The case for change… … and why it might still not happen Disruptive technologies under development such as electric vehicles – attracting talent, capital and attention Breakeven points to reach economically attractivebusiness cases might be too far out to be reached The Smart Rural Grid Concept Bottom-up development Local market Local market Normal operation DSO Island operation Data flow
  10. 10. • Digital revolution is changing the value chain. • Prosumers will gain market force. • For the target of decarbonisation the electricity system is crucial. • The DSO is core of the digitalization, decarbonisation and decentralization strategy. Digital- ization De- carbon- isation DSO De- central- ization

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