by Samir Alilat
Samir Alilat of AMT-SYBEX on how the UK energy sector can get smarter about long-term demand management
Things are changing fast for the UK energy sector. Already operating in a complex and fragmented industry, electricity providers are facing unprecedented levels of disruption as the industry shifts towards less centralised power sources, and new demands create ever-greater complexity for distribution network operators (DNOs).
With the rise of renewable energy sources like wind and solar energy, and a corresponding decline in more traditional power sources, comes a shift towards a more decentralised energy network. The distribution networks were not built to accommodate decentralised power generation, and the expansion of solar and wind resources at the edge of the network will necessitate a move to a more actively and locally managed energy system.
At the same time, the increasing adoption of electric vehicles poses both challenges and opportunities for the energy industry. With UK sales of electric vehicles rising by 11% in the last year, and only set to grow further, DNOs must contend with a new, unpredictable and growing source of demand, as well as exploring ways to take advantage of what is essentially a fleet of localised electricity storage devices.
Meanwhile, although smart meter technology represents a major opportunity for more granular network management and fairer consumer pricing, it also presents another administrative and regulatory burden for the energy sector to master.
But while new technology is creating many dilemmas for the UK energy industry, it could also provide the key to more effective network management. AMT-SYBEX are helping create dynamic solutions for flexible asset optimisation and demand forecasting, that will enable energy companies to adapt to the demands of the future.
The ENA Future Worlds Initiative
The Energy Networks Association (ENA) recently launched a major study into the future of the country’s energy sector, entitled the Future Worlds consultation.
The consultation envisages five different ‘worlds’—potential scenarios for how the UK’s energy sector may be structured in the next funding period and beyond. The scenarios range from a world where Distribution System Operators (DSOs) take the most active role in coordinating and facilitating flexibility markets, to one where flexibility markets and services are managed by a new independent market role. Other scenarios feature the DSO and System Operator (SO) sharing these roles and the use of pricing signals to regulate the market.
The consultation will seek industry views on each of these potential scenarios, with a long-term goal of selecting one of them as a consensus model going forward, or reaching a hybrid solution that combines aspects of multiple worlds. The changes made as a result of this consultation are projected to deliver consumer savings across the market as a whole up to £40 billion through industry streamlining and increased network efficiency.
The best of all possible worlds
Whatever the outcome of the Future Worlds consultation, the message is clear: the future of the UK energy network will depend on granular asset management and demand forecasting. These are areas where AMT-SYBEX has much to offer, no matter the precise details of the future network.
For example, one industry trend which will hold regardless of the ENA Future Worlds outcome is the continuing evolution of DNOs into DSOs. This means moving towards managing supply and demand at the distribution network level, making use of decentralised power sources and balancing them with local demand.
The DNO-to-DSO transition is crucial if network operators are to adapt to the future of the national energy system. Western Power Distribution is one example of a DNO currently making this transition, and part of the process is a pioneering project with AMT-SYBEX to develop an Electricity Flexibility and Forecasting System (EFFS). This type of intelligent energy management system will enable DSOs to predict the demand for power within individual areas of their distribution networks over periods ranging from a few hours to a few months, and manage network supply accordingly, potentially even creating local markets for certain types of power.
The EFFS project represents a major stepping-stone for companies wishing to make the DNO-to-DSO transition and will empower operators to take a more proactive role in future energy management.
Here’s to the future
Whatever the results of the ENA Future Worlds consultation, it is clear that the energy industry needs to get smarter about the way it forecasts demand and manages supply. All stakeholders in the UK energy sector have a role to play in the coming changes, and those who don’t engage with the consultation risk being left behind as the sector reshapes itself.
At AMT-SYBEX, we aim to provide energy companies with the ‘investment of least regret’, a set of software platforms and services that will empower stable long-term asset management and provide a basis for sustainable growth. If you would like to learn more about our solutions, or how the ENA Future Worlds consultation could affect your business, get in touch.