The traditional energy system is a centralised network with one-way power flow, with electricity generated by traditional power plants. In order to move away from costly and carbon intensive fossil fuels and incorporate an increased proportion of intermittent generation, a shift towards a decentralised energy system with multi-directional power flow and electricity generated locally by distributed generators is needed.
This change requires an unprecedented amount of data to be processed from the energy system to unlock hidden flexibility on the network.
The shift towards a decentralised energy model
The current UK energy market is a traditional generation stack model. Leading the pack are coal (29GW) and gas (18GW), which also provide the vast majority of system flexibility at 1.8GW and 4.9GW, respectively. This is counter-intuitive as they are the most carbon intensive and expensive energy sources. At the bottom of the stack are assets connected to the distribution network: distributed generation (12GW) and distribution connected wind (9GW) and solar (7GW).
Although significant in size, distributed generation goes unused for grid balancing and sits dumb on the network. Extracting flexibility from distributed generation would require logging and processing of data at a high degree of data granularity in near real-time, which is currently not undertaken. Demand is not a significant contributor to flexibility within this energy mix as energy users are not incentivized to shift or reduce demand at peak times.
Unlocking this combined flexibility of distributed generation and demand is key to shifting towards a decentralised energy model. The reason this flexibility has not yet been harnessed is due to the challenge big data poses. We’ve estimated that the UK energy system currently produces in the region of 1GB of data logged per day, which represents estimated billing and some commercial smart metering. However, in order to extract flexibility from distributed assets and demand, 270,000GB would need to be logged per day.
By 2030, we expect to see major changes in the UK energy stack, namely an almost complete decline in coal and an enormous increase in wind (40GW) and more distributed generation (13GW). We will continue to rely on gas for baseload (27GW) and for flexibility (4.5GW). The greatest increase in flexibility will happen within distributed generation (4.5GW). Demand will become an active contributor to system flexibility (6.6GW). This flexibility could be a factory turning off a manufacturing process for an hour, a business turning off its air conditioning for half an hour or an office building turning its lights on in the evening when the wind is blowing and there is excess supply on the network. Everyone from households to factories to office buildings will be significantly contributing towards grid balancing. Gas will continue to provide significant amounts of flexibility but it will start competing directly with flexibility from demand and distributed, wind and solar generation.
Big data’s contribution to decentralisation
In order to achieve this low carbon energy future, big data needs to be tackled. The benefit of harnessing energy system data is compelling – inactive customers can become active market players, drastically changing the energy system from a centralised network to a decentralised system. It will level the playing field for small market players, providing them with the same market and grid balancing opportunities previously reserved for traditional generation plants.
The transition to becoming active market participants requires distributed generators and businesses to understand their energy usage/export in order for them to change their behaviour intelligently to exploit maximum value from their flexibility.
Technology in the form of monitoring, automation and analytics are needed to allow for rapid response to grid or market signals contributing to overall system robustness and flexibility. By harnessing data, power can literally and figuratively be devolved to small scale distributed generators and businesses.
This marks a major shift in the energy industry.