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This project has received fundingfrom the EuropeanUnion’s Horizon2020 research and Innovation programme
under grant agreem...
www.IndustRE.eu
Contents
Slide 2
Part I How calculating a demand response business case?
Part II The need for a simplified...
www.IndustRE.eu
Contents
Slide 3
Part I How calculating a demand response business case?
Part II The need for a simplified...
www.IndustRE.eu
How can you make money with flexibility?
Part I: What do you need to calculate a demand response business ...
www.IndustRE.eu
What is possible from a legal point of view?
Part I: What do you need to calculate a demand response busin...
www.IndustRE.eu
Which price data is available?
Part I: What do you need to calculate a demand response business case?
Slid...
www.IndustRE.eu
How much flexibility is available?
Part I: What do you need to calculate a demand response business case?
...
www.IndustRE.eu
Calculate the business case
Part I: What do you need to calculate a demand response business case?
Slide 8...
www.IndustRE.eu
Contents
Slide 9
Part I How calculating a demand response business case?
Part II The need for a simplified...
www.IndustRE.eu
Skills for creating a flexibility model …
Part II: The need for a simplified methodology
Slide 10
flexibil...
www.IndustRE.eu
Business case calculation complexity …
Part II: The need for a simplified methodology
Slide 11
business ca...
www.IndustRE.eu
Business case calculation complexity …
Part II: The need for a simplified methodology
Slide 12
business ca...
www.IndustRE.eu
Business case calculation complexity …
Part II: The need for a simplified methodology
Slide 13
business ca...
www.IndustRE.eu
Accuarcy of the business case value
Part II: The need for a simplified methodology
Slide 14
“Building up i...
www.IndustRE.eu
Accuarcy of the business case value
Part II: The need for a simplified methodology
Slide 15
“Building up i...
www.IndustRE.eu
Requirements of a simplified methodology
Part II: The need for a simplified methodology
Slide 16
1 Being c...
www.IndustRE.eu
Requirements of a simplified methodology
Part II: The need for a simplified methodology
Slide 17
1
2
Being...
www.IndustRE.eu
Requirements of a simplified methodology
Part II: The need for a simplified methodology
Slide 18
1
2
3
Bei...
www.IndustRE.eu
Contents
Slide 19
Part I How calculating a demand response business case?
Part II The need for a simplifie...
www.IndustRE.eu
The naïve approach …
Part III: The simplified methodology step-by-step
Slide 20
“Database with many
precal...
www.IndustRE.eu
A smarter approach … in 4 steps
Part III: The simplified methodology step-by-step
Slide 21
1
2
3
map
norma...
www.IndustRE.eu
A smarter approach … in 4 steps
Part III: The simplified methodology step-by-step
Slide 22
1
2
3
map
norma...
www.IndustRE.eu
Example: generic battery model
Part III: The simplified methodology step-by-step
Slide 23
Emax
EPin Pout
E...
www.IndustRE.eu
Example: generic battery model
Part III: The simplified methodology step-by-step
Slide 24
ro
ri
bmax
bmin
...
www.IndustRE.eu
Example: generic battery model
Part III: The simplified methodology step-by-step
Slide 25
ro
ri
bmax
bmin
...
www.IndustRE.eu
A smarter approach … in 4 steps
Part III: The simplified methodology step-by-step
Slide 26
1
2
3
map
norma...
www.IndustRE.eu
Some properties scale very well …
Part III: The simplified methodology step-by-step
Slide 27
1x
“If you ca...
www.IndustRE.eu
Some properties scale very well …
Part III: The simplified methodology step-by-step
Slide 28
1x 20x
“If yo...
www.IndustRE.eu
Some properties scale very well …
Part III: The simplified methodology step-by-step
Slide 29
“If you can e...
www.IndustRE.eu
Some properties scale very well …
Part III: The simplified methodology step-by-step
Slide 30
“If you can e...
www.IndustRE.eu
A smarter approach … in 4 steps
Part III: The simplified methodology step-by-step
Slide 31
1
2
3
map
norma...
www.IndustRE.eu
Making money with a “reference battery” on the day ahead market
Part III: The simplified methodology step-...
www.IndustRE.eu
Making money with a “reference battery” on the day ahead market
Part III: The simplified methodology step-...
www.IndustRE.eu
Making money with a “reference battery” on the day ahead market
Part III: The simplified methodology step-...
www.IndustRE.eu
Making money with a “reference battery” on the day ahead market
Part III: The simplified methodology step-...
www.IndustRE.eu
Making money with a “reference battery” on the day ahead market
Part III: The simplified methodology step-...
www.IndustRE.eu
Making money with a “reference battery” on the day ahead market
Part III: The simplified methodology step-...
www.IndustRE.eu
The normalized business case graph
Part III: The simplified methodology step-by-step
Slide 38
www.IndustRE.eu
A smarter approach … in 4 steps
Part III: The simplified methodology step-by-step
Slide 39
1
2
3
map
norma...
www.IndustRE.eu
Scale back to the real process parameters
Part III: The simplified methodology step-by-step
Slide 40
1x 20...
www.IndustRE.eu
Summary
Part III: The simplified methodology step-by-step
Slide 41
“Starting point is an industrial proces...
www.IndustRE.eu
Summary
Part III: The simplified methodology step-by-step
Slide 42
industrial
process
normalized
reference...
www.IndustRE.eu
Summary
Part III: The simplified methodology step-by-step
Slide 43
industrial
process
normalized
reference...
www.IndustRE.eu
Summary
Part III: The simplified methodology step-by-step
Slide 44
normalized
business
case graph
normaliz...
www.IndustRE.eu
Summary
Part III: The simplified methodology step-by-step
Slide 45
normalized
business
case graph
normaliz...
www.IndustRE.eu
Contents
Slide 46
Part I How calculating a demand response business case?
Part II The need for a simplifie...
www.IndustRE.eu
Configuration
Part IV: On-site renewable energy business case
Slide 47
www.IndustRE.eu
At low wind conditions
Part IV: On-site renewable energy business case
Slide 48
grid to customer 100€/MWh
...
www.IndustRE.eu
At high wind conditions
Part IV: On-site renewable energy business case
Slide 49
wind to customer 40€/MWh
...
www.IndustRE.eu
On-site VRE with the generic battery model
Part IV: On-site renewable energy business case
Slide 50
Emax
E...
www.IndustRE.eu
On-site VRE normalized business case graph RE
Part IV: On-site renewable energy business case
Slide 51
www.IndustRE.eu
On-site VRE normalized business case graph RE
Part IV: On-site renewable energy business case
Slide 52
www.IndustRE.eu
On-site VRE normalized business case graph RE
Part IV: On-site renewable energy business case
Slide 53
www.IndustRE.eu
On-site VRE normalized business case graph RE
Part IV: On-site renewable energy business case
Slide 54
www.IndustRE.eu
On-site VRE normalized business case graph RE
Part IV: On-site renewable energy business case
Slide 55
www.IndustRE.eu
On-site VRE normalized business case graph RE
Part IV: On-site renewable energy business case
Slide 56
www.IndustRE.eu
On-site VRE normalized business case graph RE
Part IV: On-site renewable energy business case
Slide 57
“ …...
www.IndustRE.eu
Contents
Slide 58
Part I How calculating a demand response business case?
Part II The need for a simplifie...
www.IndustRE.eu
Have the requirements been met?
Part V: Conclusions and further steps
Slide 59
1
2
3
Being cost effective ...
www.IndustRE.eu
Have the requirements been met?
Part V: Conclusions and further steps
Slide 60
1
2
3
Being cost effective ...
www.IndustRE.eu
Does this really work for complex cases?
Part V: Conclusions and further steps
Slide 61
BC value ≤ BC4 val...
www.IndustRE.eu
Next steps with the methodology
Part V: Conclusions and further steps
Slide 62
• Methodology will be teste...
www.IndustRE.eu
• Bringing this methodology to the market is
part of the IndustRE project
• A successful webinar was organ...
www.IndustRE.eu
Contact information
Part V: Conclusions and further steps
Jef Verbeeck
Senior Researcher Energy Technology...
2016 IndustRE Workshop - 3 DSM Flexibility Assessment Methodology
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2016 IndustRE Workshop - 3 DSM Flexibility Assessment Methodology

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September 2016 Stakeholders Workshop

Simplified methodology to determine the value of industrial flexibility in given electricity market conditions.

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2016 IndustRE Workshop - 3 DSM Flexibility Assessment Methodology

  1. 1. This project has received fundingfrom the EuropeanUnion’s Horizon2020 research and Innovation programme under grant agreement No 646191 - The sole responsibilityfor the content of this presentation lies with the authors. It does not necessarilyreflect the opinion of the European Union. Neither INEA nor the European Commission are responsiblefor any use that may be made of the information containedtherein September 12, 2016 Jef Verbeeck - VITO/EnergyVille Methodology for optimal valorization of industrial flexible electricity consumption stakeholder meeting: “Demand side flexibility business case estimation made easy … ”
  2. 2. www.IndustRE.eu Contents Slide 2 Part I How calculating a demand response business case? Part II The need for a simplified methodology Part III The simplified methodology step-by-step Part IV On-site renewable energy business case Part V Conclusions and further steps
  3. 3. www.IndustRE.eu Contents Slide 3 Part I How calculating a demand response business case? Part II The need for a simplified methodology Part III The simplified methodology step-by-step Part IV On-site renewable energy business case Part V Conclusions and further steps
  4. 4. www.IndustRE.eu How can you make money with flexibility? Part I: What do you need to calculate a demand response business case? Slide 4 flexibility model business models regulation market data Business model Commodity Network charges Commodity Network charges FC reserve FR reserve R reserve Imbalance optimization On-site VRE optimization Standard contract optimization Day-ahead optimization Reserve capacity BE FR DE IT ES UK
  5. 5. www.IndustRE.eu What is possible from a legal point of view? Part I: What do you need to calculate a demand response business case? Slide 5 “Although EU guidelines are quite clear, implementation pace is different…” flexibility model business models regulation market data Business model Commodity       Network charges       Commodity       Network charges       FC reserve       FR reserve       R reserve                   BE FR DE IT ES UK Standard contract optimization Day-ahead optimization Reserve capacity Imbalance optimization On-site VRE optimization  business case is viable in exisiting regulatory framework  business case limited viability/restricted in current regulatory framework  business case impossible in existing regulatory framework
  6. 6. www.IndustRE.eu Which price data is available? Part I: What do you need to calculate a demand response business case? Slide 6 flexibility model business models regulation market data Business model Commodity       Network charges       Commodity       Network charges       FC reserve       FR reserve       R reserve                   BE FR DE IT ES UK Standard contract optimization Day-ahead optimization Reserve capacity Imbalance optimization On-site VRE optimization public price data available bilateral price data estimates available (bilateral) price data not available
  7. 7. www.IndustRE.eu How much flexibility is available? Part I: What do you need to calculate a demand response business case? Slide 7 flexibility model business models regulation market data + flexgraph total flexgraph 1 flexgraph 2 flexgraph 3 flexibility modelling flexibility modelling flexibility modelling +total energy consumption inflexible consumption
  8. 8. www.IndustRE.eu Calculate the business case Part I: What do you need to calculate a demand response business case? Slide 8 flexibility model business models regulation market data business case business case calculation Business model Commodity  PP  PP  PP  PP  PP  PP Network charges  PP  PP  PP  PP  PP  PP Commodity  PP  PP  PP  PP  PP  PP Network charges  PP  PP  PP  PP  PP  PP FC reserve  C  C  C  -  -  C FR reserve  -  C/PP  C/PP  -  -  C R reserve  C  C  C/PP  -  -  C  DIP  DIP  PP DIP/PP DIP  DIP  DS  DS  DS  DS  -  DS Standard contract optimization Day-ahead optimization Reserve capacity Imbalance optimization On-site VRE optimization BE FR DE IT ES UK PP DS DIP C Price profile optimization method (energy + peak) Dual supplier optimization method (supplier + own production + peak ) Dual imbalance price optimization Total costs optimization method (capacity only)
  9. 9. www.IndustRE.eu Contents Slide 9 Part I How calculating a demand response business case? Part II The need for a simplified methodology Part III The simplified methodology step-by-step Part IV On-site renewable energy business case Part V Conclusions and further steps
  10. 10. www.IndustRE.eu Skills for creating a flexibility model … Part II: The need for a simplified methodology Slide 10 flexibility model A flexibility model is the result of a 2 stage process: selection stage: • identification of flexibility during a site survey or audit • requires good top-level understanding of industrial processes with focus on energy flows modelling stage: • construction of a mathematical model which describes production process and constraints from energy consumption point of view • requires understanding of modelling and optimization techniques The combination of skills is not so obvious
  11. 11. www.IndustRE.eu Business case calculation complexity … Part II: The need for a simplified methodology Slide 11 business case calculation
  12. 12. www.IndustRE.eu Business case calculation complexity … Part II: The need for a simplified methodology Slide 12 business case calculation
  13. 13. www.IndustRE.eu Business case calculation complexity … Part II: The need for a simplified methodology Slide 13 business case calculation
  14. 14. www.IndustRE.eu Accuarcy of the business case value Part II: The need for a simplified methodology Slide 14 “Building up interest in demand response is for many companies a long, time consuming, multi-stage process…”
  15. 15. www.IndustRE.eu Accuarcy of the business case value Part II: The need for a simplified methodology Slide 15 “Building up interest in demand response is for many companies a long, time consuming, multi-stage process…” … but an order of magnitude business case estimation is enough to plant a seed”
  16. 16. www.IndustRE.eu Requirements of a simplified methodology Part II: The need for a simplified methodology Slide 16 1 Being cost effective and time efficient
  17. 17. www.IndustRE.eu Requirements of a simplified methodology Part II: The need for a simplified methodology Slide 17 1 2 Being cost effective and time efficient Order of magnitude accuracy estimation is good enough
  18. 18. www.IndustRE.eu Requirements of a simplified methodology Part II: The need for a simplified methodology Slide 18 1 2 3 Being cost effective and time efficient Order of magnitude accuracy estimation is good enough No specific modelling and optimization knowledge and tools needed
  19. 19. www.IndustRE.eu Contents Slide 19 Part I How calculating a demand response business case? Part II The need for a simplified methodology Part III The simplified methodology step-by-step Part IV On-site renewable energy business case Part V Conclusions and further steps
  20. 20. www.IndustRE.eu The naïve approach … Part III: The simplified methodology step-by-step Slide 20 “Database with many precalculated business cases”
  21. 21. www.IndustRE.eu A smarter approach … in 4 steps Part III: The simplified methodology step-by-step Slide 21 1 2 3 map normalize select 4 scale
  22. 22. www.IndustRE.eu A smarter approach … in 4 steps Part III: The simplified methodology step-by-step Slide 22 1 2 3 map normalize select 4 scale
  23. 23. www.IndustRE.eu Example: generic battery model Part III: The simplified methodology step-by-step Slide 23 Emax EPin Pout Emin generic battery model
  24. 24. www.IndustRE.eu Example: generic battery model Part III: The simplified methodology step-by-step Slide 24 ro ri bmax bmin b P Emax EPin Pout Emin generic battery model buffered industrial process
  25. 25. www.IndustRE.eu Example: generic battery model Part III: The simplified methodology step-by-step Slide 25 ro ri bmax bmin b P Emax EPin Pout Emin generic battery model buffered industrial process CHP with a hot water storage tank
  26. 26. www.IndustRE.eu A smarter approach … in 4 steps Part III: The simplified methodology step-by-step Slide 26 1 2 3 map normalize select 4 scale
  27. 27. www.IndustRE.eu Some properties scale very well … Part III: The simplified methodology step-by-step Slide 27 1x “If you can earn 20€/year by trading electricity on the day-ahead market with 1 car battery … “ Pin = 2 kW Pout = 2 kW Emax = 1 kWh
  28. 28. www.IndustRE.eu Some properties scale very well … Part III: The simplified methodology step-by-step Slide 28 1x 20x “If you can earn 20€/year by trading electricity on the day-ahead market with 1 car battery … “ Pin = 2 kW Pout = 2 kW Emax = 1 kWh “… you can earn 400€/year with 20 car batteries!“ Pin = 40 kW Pout = 40 kW Emax = 20 kWh
  29. 29. www.IndustRE.eu Some properties scale very well … Part III: The simplified methodology step-by-step Slide 29 “If you can earn 2.000€/year by shifting electricity consumption from day to night … “ 89€/MWh 104€/MWh 15€/MWh
  30. 30. www.IndustRE.eu Some properties scale very well … Part III: The simplified methodology step-by-step Slide 30 “If you can earn 2.000€/year by shifting electricity consumption from day to night … “ “… you can earn 4.000€/year in case the price difference doubles …“ 89€/MWh 104€/MWh 15€/MWh 30€/MWh 79€/MWh 109€/MWh
  31. 31. www.IndustRE.eu A smarter approach … in 4 steps Part III: The simplified methodology step-by-step Slide 31 1 2 3 map normalize select 4 scale
  32. 32. www.IndustRE.eu Making money with a “reference battery” on the day ahead market Part III: The simplified methodology step-by-step Slide 32 “Day ahead electricity price for 1 day …”
  33. 33. www.IndustRE.eu Making money with a “reference battery” on the day ahead market Part III: The simplified methodology step-by-step Slide 33 “Buy electricity when cheap …”
  34. 34. www.IndustRE.eu Making money with a “reference battery” on the day ahead market Part III: The simplified methodology step-by-step Slide 34 “Well electricity when expensive …”
  35. 35. www.IndustRE.eu Making money with a “reference battery” on the day ahead market Part III: The simplified methodology step-by-step Slide 35 “Keep within the battery upper and lower limit”
  36. 36. www.IndustRE.eu Making money with a “reference battery” on the day ahead market Part III: The simplified methodology step-by-step Slide 36 “Start and stop with a 50% charged battery”
  37. 37. www.IndustRE.eu Making money with a “reference battery” on the day ahead market Part III: The simplified methodology step-by-step Slide 37 • For 1 day in this example: profit = 66,16€ • For whole year: profit = 19.240€/year • … or an average profit of 2,2€/MW/h • In case you double the battery size, but not the Pin and Pout, unfortunately this doesn’t scale very well “But why not putting it in a graph?”
  38. 38. www.IndustRE.eu The normalized business case graph Part III: The simplified methodology step-by-step Slide 38
  39. 39. www.IndustRE.eu A smarter approach … in 4 steps Part III: The simplified methodology step-by-step Slide 39 1 2 3 map normalize select 4 scale
  40. 40. www.IndustRE.eu Scale back to the real process parameters Part III: The simplified methodology step-by-step Slide 40 1x 20x “If you can earn 20€/year by trading electricity on the day-ahead market with 1 car battery … “ Pin = 2 kW Pout = 2 kW Emax = 1 kWh “… you can earn 400€/year with 20 car batteries!“ Pin = 40 kW Pout = 40 kW Emax = 20 kWh
  41. 41. www.IndustRE.eu Summary Part III: The simplified methodology step-by-step Slide 41 “Starting point is an industrial process …” industrial process
  42. 42. www.IndustRE.eu Summary Part III: The simplified methodology step-by-step Slide 42 industrial process normalized reference process “ … which will be mapped on a reference process …”
  43. 43. www.IndustRE.eu Summary Part III: The simplified methodology step-by-step Slide 43 industrial process normalized reference process “ … which is normalized to an 1MW equivalent …”
  44. 44. www.IndustRE.eu Summary Part III: The simplified methodology step-by-step Slide 44 normalized business case graph normalized business case graph normalized business case graph industrial process normalized reference process normalized business case normalized business case graph normalized business case graph referenceprocesses business cases normalized business case graph “ … select the correct normalized business case graph and value … ”
  45. 45. www.IndustRE.eu Summary Part III: The simplified methodology step-by-step Slide 45 normalized business case graph normalized business case graph normalized business case graph industrial process normalized reference process normalized business case normalized business case graph normalized business case graph referenceprocesses business cases normalized business case graph “ … and scale back to the correct business case value.” business case
  46. 46. www.IndustRE.eu Contents Slide 46 Part I How calculating a demand response business case? Part II The need for a simplified methodology Part III The simplified methodology step-by-step Part IV On-site renewable energy business case Part V Conclusions and further steps
  47. 47. www.IndustRE.eu Configuration Part IV: On-site renewable energy business case Slide 47
  48. 48. www.IndustRE.eu At low wind conditions Part IV: On-site renewable energy business case Slide 48 grid to customer 100€/MWh wind to customer 40€/MWh
  49. 49. www.IndustRE.eu At high wind conditions Part IV: On-site renewable energy business case Slide 49 wind to customer 40€/MWh wind to grid
  50. 50. www.IndustRE.eu On-site VRE with the generic battery model Part IV: On-site renewable energy business case Slide 50 Emax E Emin generic battery model inflexible load+ +
  51. 51. www.IndustRE.eu On-site VRE normalized business case graph RE Part IV: On-site renewable energy business case Slide 51
  52. 52. www.IndustRE.eu On-site VRE normalized business case graph RE Part IV: On-site renewable energy business case Slide 52
  53. 53. www.IndustRE.eu On-site VRE normalized business case graph RE Part IV: On-site renewable energy business case Slide 53
  54. 54. www.IndustRE.eu On-site VRE normalized business case graph RE Part IV: On-site renewable energy business case Slide 54
  55. 55. www.IndustRE.eu On-site VRE normalized business case graph RE Part IV: On-site renewable energy business case Slide 55
  56. 56. www.IndustRE.eu On-site VRE normalized business case graph RE Part IV: On-site renewable energy business case Slide 56
  57. 57. www.IndustRE.eu On-site VRE normalized business case graph RE Part IV: On-site renewable energy business case Slide 57 “ … and if you plot it differently, you even see that there are optimal ratio’s …”
  58. 58. www.IndustRE.eu Contents Slide 58 Part I How calculating a demand response business case? Part II The need for a simplified methodology Part III The simplified methodology step-by-step Part IV On-site renewable energy business case Part V Conclusions and further steps
  59. 59. www.IndustRE.eu Have the requirements been met? Part V: Conclusions and further steps Slide 59 1 2 3 Being cost effective and time efficient Order of magnitude accuracy estimation is good enough No specific modelling and optimization knowledge and tools needed
  60. 60. www.IndustRE.eu Have the requirements been met? Part V: Conclusions and further steps Slide 60 1 2 3 Being cost effective and time efficient Order of magnitude accuracy estimation is good enough No specific modelling and optimization knowledge and tools needed “ Under the condition that the industrial process can be mapped on a relevant reference process, the approach is very straightforward “
  61. 61. www.IndustRE.eu Does this really work for complex cases? Part V: Conclusions and further steps Slide 61 BC value ≤ BC4 value + BC6 value
  62. 62. www.IndustRE.eu Next steps with the methodology Part V: Conclusions and further steps Slide 62 • Methodology will be tested and refined (if needed) during a number of case studies • Case studies will take place Q4-2016 till Q2- 2017 in the 6 target countries
  63. 63. www.IndustRE.eu • Bringing this methodology to the market is part of the IndustRE project • A successful webinar was organised as a first information session, showing the potential of the methodology • Mid 2017, a hands-on workshop will be organized  we’ll keep you informed! Next steps with the methodology Part V: Conclusions and further steps Slide 63
  64. 64. www.IndustRE.eu Contact information Part V: Conclusions and further steps Jef Verbeeck Senior Researcher Energy Technology +32 14 33 59 17 jef.verbeeck@energyville.be Steven Van Deun Business Development EnergyVille +32 14 33 58 37 steven.vandeun@energyville.be Thor Park 8310 | 3600 Genk | Belgium Daan Six Project Manager Energy Technology +32 14 33 58 47 daan.six@energyville.be Slide 64

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