Chris Kimmett, Commercial Manager, Open Energi
The energy system is undergoing a huge transformation away from centralised generation to small-scale, distributed power. National Grid’s Future Energy Scenarios (FES) models indicate that by 2020, small-scale, distributed generation will represent a third of total capacity in the UK and, as a result, speed of response to changes in energy supply and demand will be more important than ever.
And it is not only the increase in distributed generation that will prove challenging for the UK grid. The coal-fired Ferrybridge, Longannet, Fiddler’s Ferry and Rugeley are all expected to come offline this year, and with gas power stations procured under the Capacity Market now in doubt, the cushion between supply and demand is smaller than ever.
A new source of flexibility is urgently required, and storage to provide this flexibility will be an increasingly essential part of a responsive, secure and sustainable energy future for the UK.
Energy storage is commonly understood to mean batteries and pumped hydro systems. While both are valuable, current costs, installation times, and issues around recycling and decommissioning are all prohibitive to wider deployment. But storage exists in a number of forms, including through demand side response (DSR), which takes advantage of latent heat in energy-intensive equipment and devices to create new flexibility for the grid.
If too much energy is supplied at any given time, it doesn’t have to be stored in a battery: instead, Internet of Things (IOT) based forms of demand response can adjust the consumption of energy-intensive devices to make use of power when it is available. In instances when there is not enough power, demand can be deferred rather than drawing from a battery to supplement supply.
This smart DSR approach is ideally suited to heating and cooling assets that have the characteristics of stored energy devices. By harnessing existing everyday equipment, from fridges to furnaces, and invisibly switching them on or off for a few minutes at a time, energy demand can be adjusted to meet available supply in real-time, creating a distributed storage technology.
Take the asphalt plants which manage the complete asphalt production process for road construction as an example. Liquid bitumen for road surfacing is stored in large, well-insulated tanks, and a heater maintains the temperature of the bitumen between a low set point (typically 150 degrees C) and a high set point (typically 180 degrees C).
These tanks have “thermal inertia”, meaning the amount of energy they use can be adjusted and the temperature of the bitumen won’t be immediately affected: Bitumen tanks can be switched off for an hour and the temperature may only fall by between 0.5-15 degrees C.
Using demand response technology, bitumen tanks can deliver a full response to National Grid within two seconds (quicker than traditional thermal generation) and for up to 30 minutes, provided they are within their set-points. The average duration of Open Energi’s switch requests to bitumen tanks is just 3.3 minutes.
Cooling systems such as supermarket refrigeration also provide a distributed storage network that can help to balance UK-wide electricity supply and demand in real-time.
Open Energi estimates that if Dynamic Demand was deployed in the commercial refrigeration assets of the five largest retailers in the UK, it could meet approximately 6% of the UK’s total 1.8GW requirement for Frequency Response, roughly equivalent to 100 MW. This would generate revenues of up to £10 million a year for the asset owners and reduce UK CO2 emissions by around 227,600 tonnes a year.
Other latent heat storage assets include: heating, ventilation, air conditioning, and hot water boilers in commercial property; electric induction furnaces, ovens and melting pots in foundries and metal processing sites; and heaters and aerators at water processing sites.
Because these devices have already been built, it is possible to aggregate the stored thermal energy they contain and build a virtual power station at a fraction of the cost of building a grid scale battery or new generation capacity. The capital cost of building a new peaking power station can be up to £5 million per MW and battery systems in the region of £0.5 million-£1.8 million per MW. A MW of demand response, on the other hand, costs around £200,000 to aggregate.
DSR, coupled with on-site generation and energy storage technologies means that the energy market is no longer a linear value chain driven by fossil fuel production but is becoming decentralised and bi-directional; creating a new energy economy where energy consumers can both take and provide service back to the grid and generate revenue.
To realise the full potential of DSR technology we now need to further understand where the potential for flexibility, including latent heat, lies across the UK’s entire electricity network: assessing both regions and sectors.
In the same way that traditional energy commodities like oil, gas and coal are mapped by geologists to identify resource rich areas, a flexibility mapping process will enable demand response aggregators to identify the DSR ‘hot spots’. This in turn will give business, industry and policy makers the confidence to invest in DSR technology ahead of building additional spinning reserve, and the certainty they need to plan for a future where flexible Demand Response plays an integral role in delivering a secure and resilient energy system.
By using land data from regional authorities, for instance the GLA for London, the industry can develop a better understanding of where the flexibility potential lies, whether that be in heavy industry, commercial buildings or residential areas.
Open Energi is working to map flexible demand in the UK from the bottom up, asset by asset, sector by sector, to model the capacity in the market and demonstrate how much generation can be displaced.
Increasing flexibility on the grid has historically meant building more generation, but latent heat in energy intensive equipment presents a hugely valuable opportunity. And through mapping, this opportunity can be realised at scale for the UK.