Spain has a great success story to tell, having fully converted the domestic sector to smart meters at the end of last year. The country’s major utilities are now embarking on an ambitious agenda to digitalise the grid using the new capabilities and data available from the smart meters. Engerati asked aelēc president Marina Serrano for her insights into the energy transition.
E: Spain had a very successful smart meter rollout programme. What can other countries learn from that?
MS: Back in 2009, the European Commission ordered all member states in the EU to ensure at least 80% of its meters as “smart” by 2020. Spain, following Sweden, Italy, Finland and Malta is one of the European countries who has decided to replace 100% of domestic devices, and has already achieved it in December 2018. There are now 28 million of these new devices in our grids with functionalities such as load management, remote firmware upgrade, quality control or fraud detection. But there is more. There is an ambitious initiative by the Spanish utility companies that complements the legal obligation to change meters with an extensive modernisation and digitalisation of the electricity grid. The Spanish smart metering architecture solution is a great case of success and is based on a fully interoperable design, using multi-vendor devices, based on open standards which are exchangeable at any time and place. This architecture is designed in a way to both connect the customers and enable the medium voltage-low voltage monitoring and control: apart from the smart meters located in households, there are concentrators located at the secondary substations which receive data from the closest smart meters and there is a central data management system at the utility end which receive all data from the concentrators.
E: Are energy companies making use of the new data arising from smart meters?
MS: With 28 million new devices, billions of data needs to be managed. From a company perspective data from meters allow them to monitor and remotely and automatically control the electricity grid, enabling it to stay ahead of potential incidents and improve the quality of the service it provides to customers. This available information also enables the electricity distribution grid to be operated more efficiently, reducing losses and increasing safety.
Companies have designed mobile apps and dedicated websites where customers can consult their daily, weekly and monthly consumption curves, their peak power demand and much more. The data provided by the smart meters reveals how the electricity consumption is distributed for more efficient use and helps customers to decide which tariff rate suits better for their profile. Remote management enables immediate execution of any services the customer requires, such as changes of contracted power, unscheduled meter readings, contract acceptance and cancellation.
E: Are smart meters already changing customer behaviour?
MS: At present, the access tariffs in Spain in the low voltage level do not include price discrimination. This is obviously an important barrier that impedes customers to properly behave as a result of efficient signals to use the networks. The regulator is presently working in the design of a new methodology that should take the existence of smart meters into account. Now, as already mentioned, new devices are able to differentiate among periods on a daily and monthly basis.
In the same sense, the day-ahead market price is on an hourly basis, as in the majority of European power markets. The regulator changed the regulated price for low voltage customers by introducing an hourly differentiation. So, this type of price discrimination signal is completely feasible because of the smart meters and it is time now to see if the customer is interested in changing its behaviour. In the near future, with the massive penetration of e-mobility, heat pumps and other uses of electricity the customer will be more and more interested in optimally managing its electricity consumption by using efficient price signals.
E: What regulatory challenges remain for deeper penetration of digitalisation?
MS: Network management is going to change dramatically in the following years. The present grid operation task is to be replaced by an intelligent platform optimizer. And this is only feasible if further digitalisation is introduced in the grids, one of the two main challenges of the electricity sector with the transition to a decarbonised and electrified economy. Thus, the digitalisation can be accelerated in the regulatory framework with the use of specific incentives for these purposes. Furthermore, specific regulatory initiatives, also known as regulatory sandboxes, may be optimal tools for developing projects to better manage congestions or accommodate DER in the grid. So, we are moving to a regulatory framework that is to be active on a case-by-case basis in order to check appropriate initiatives rather than past general and common measures for grid operators.
E: How quickly do you envisage electric cars becoming mainstream in Spain and what incentives are there?
MS: Currently, electric vehicles are still more expensive than conventional ones, and do not meet the characteristics to be the first option for all potential users (due to a lower autonomy and lack of recharging infrastructure). For these reasons, aids for the purchase of vehicles should be focused on promoting the electrification of transport in a way that would ensure long-term transport sustainability, as well as reducing the environmental impact of internal combustion engine vehicles, thus avoiding the use of vehicles that still burn fossil fuels (LPG, CNG, plug-in hybrid, etc.). At the same time, they should address the installation of charging infrastructure that encourages the effective take-off of the market.
To ensure a deployment of sufficient and efficient charging infrastructures, it is necessary that funds will be allocated for the deployment of a national charging infrastructure plan. This should be developed in order to allow EVs to become mainstream as soon as possible.
E: How will the system operators need to adapt to changing demand patterns and more renewable generation?
MS: One of the main differences between the past electricity sector based on thermal assets and the new electricity sector based on renewables assets is the change of the generation pattern. The intermittency of the RES definitely transforms the way in which TSOs and DSOs must match supply and demand every second. In order to do that the most useful tool is the use of the market, as enabler of electricity buys and sells through prices. This is also part of the spirit of the Clean Energy Package: we must rely on markets so as to gain efficiencies in the energy transition period. But, in addition to this, TSOs and DSOs must act as independent market facilitators by using the network as a platform to integrate more RES, DER and change the customer to play an active role. The flexibility of networks, specifically at the low voltage level, is one of the main challenges for the next decade. So, network system operators and more especially DSOs must be at the forefront to adequately manage the changing demand and generation patterns.
E: On 11th June aelēc will host its first association congress – what do you expect to be the main talking points at the event?
MS: The meeting will approach the energy transition process to a decarbonised world from the point of view of the distribution power networks.
The congress will cover different subjects during several round tables on the power companies’ vision for the energy transition, networks as a meeting point of the new energy model, the political view of this process or the distribution networks as facilitators of the energy transition. A technical paper about the nanotechnology for a sustainable development or the power energy in the Spanish doctrine and jurisprudence will be also talking points.
This event will assemble the main actors in the Spanish power sector: public administration, representatives from power companies, consumer organisations, several sector associations, regulatory bodies, representatives of different political parties, leading figures from the judicial world, etc. Teresa Ribera, Minister for Ecological Transition, will be in the opening ceremony; while Miguel Arias Cañete, European Commissioner for Climate Action & Energy, will be responsible for the closure of the congress.
E: What are aelēc’s main activities?
MS: Aelēc is a Spanish association of utilities focusing on the dissemination and promotion of the technical and regulatory aspects of the electric activities, in particular, distribution. We also work to become a key actor able to help to develop an adequate energy transition in Spain. Aelēc brings together the five main utilities in Spain (EDP, Endesa, Iberdrola, Naturgy and Viesgo) who are widely present in the electricity value chain. Aelēc aims to promote its associated companies’ activity whose experience and know-how explains the high quality of Spanish electric supply.
Aelēc’s first congress on “Electrification and networks: binomial for energy transition” will be held on 11th June in Madrid.