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IA Special Netherlands office for Science and Technology Smart Grids and Energy Storage Focus on international business and cooperation

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IA SpecialNetherlands office for Science and Technology

Smart Grids and Energy Storage

Focus on international business and cooperation

Smart Grids and Energy Storage

Smart Grids and Energy Storage

SummaryThe rise of decentralised energy generators causes electricity grids to become increasingly more complex and difficult to manage technically. ICT can offer a solution for this issue by means of real-time monitoring of demand and supply and optimal energy management, among other aspects. ICT can also be used to support a more flexible electricity market, in which consumers can switch suppliers at any time, for instance. Smart meters and displays can be used at consumers for efficient invoicing, energy savings, and switching suppliers. Electricity grids that can optimise the management of the electricity network and support the coordination of the energy market by means of advanced ICT are called smart grids. Smart grids are currently already being experimented with on a regional scale. More semi-autonomous local networks, in which supply and demand will be balanced locally, will probably arise in the future. Aspects for which adequate solutions must be found are the anchoring of the security of supply, privacy of consumer data, and laws and regulations concerning smart grids.

IntroductionThe electric power supply in the Netherlands traditionally consists of a limited number of large electric power plants and regional distribution grids. These are connected with each other by a national transport network. Since 2007, the generation and delivery of electricity have been separated from the management of the regional electricity grids. This was done in connection with the liberalisation of the market: room had to be created for multiple suppliers of electricity on the same grid in an open market. Grid operators must keep pace with market developments. The national grid is managed by TenneT. It serves to import and export electricity, to transport it over large distances, and to take care of contingencies such as local power outages. Furthermore, TenneT is responsible for maintaining the balance between supply of and demand for electricity.In the last decades, the number of decentralised electricity generators has been increasing. One example is the Dutch gardeners with Combined Heat & Power (CHP) who return the excess electricity they generated to the grid. In addition, there are an increasing number of sustainable generators, such as wind farms, biomass power plants, solar panels, and micro-CHPs. The integration of all these electricity producers,

increasing uncertainties, and the variation in supply of as well as demand for electricity make the supply of electricity increasingly complex. After all, supply and demand must be permanently balanced with each other in order to prevent outages. These developments give rise to all sorts of questions concerning technical manageability and control, rate setting for decentrally-generated electricity and grid management, and the right to supply to the grid. Who is responsible for the reliability, efficiency, and the management of the electricity supply? And who determines the access to the network and the rates for the electricity supplied? Moreover, there are also sustainability ambitions: the supply must be clean, affordable, and reliable. Smart grids is the designation for electricity grids that function optimally and that make sustainability ambitions achievable in part through the use of ICT. Smart can on the one hand concern the optimal management of the network. For instance, real-time monitoring of supply and demand, sensors for security and tracing malfunctions, energy management in connection with savings and minimal load on the grid. On the other hand, smart can concern the coordination of the electricity market. For instance, support of energy trading with information on e.g. prices and consumption by means of smart meters, apps and displays for invoicing, savings, and free choice of suppliers at any time. A combination of both is ideal. Smart grids allow for a more efficient and more effective response to new market developments.The future will reveal how the management and control will precisely be organised. New legislation will play an important part in defining the roles of the various actors and in providing room for new products and services.

Trends & developmentsDecentralisation of electricity generation and local networks

The functions of the energy grids do change. Self-generation can give rise to situations in which less energy has to be purchased at the level of industrial estates, residential districts or holiday resorts. The function of distribution to end users shifts towards offering possibilities for returning energy or for having parties supply energy to each

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Smart Grids and Energy Storage | Netherlands Office for Science and TechnologySmart Grids and Energy Storage Smart Grids and Energy Storage

other. There is also a possibility for becoming less dependent on the public power supply and less vulnerable to contingencies elsewhere, in combination with energy storage and demand management. In the Netherlands, there are an increasing number of ongoing initiatives in the field of sustainable energy supply, often in combination with functions in the areas of housing, work, and transport. These initiatives at the municipal or regional level usually also target smart grids in order to balance local energy generation with local energy consumption. Some examples are ‘smart cities’ and local sustainable energy initiatives.

Increase in and greater flexibility of the demand for electricity

The flexibility of the demand for electricity will increase, because mobility and heating are increasingly powered by electricity. Examples are local charging of electric vehicles and heating with electric heat pumps instead of gas-fired central heating systems. The challenge of smart grids is to control the demand for electricity and to spread it out over time in such a manner that existing grids require minimal expansion.

ICT and smart metersIn the case of ICT, it namely concerns the development of network architectures, algorithms, and control concepts. In the first instance, smart meters can be used for remotely measuring energy consumption. The added value increases when smart meters can also be used for energy management by means of real-time measurement, up-to-date information, advice, and control of systems and equipment. ICT can also support the administrative processes in the energy market. As a result, consumers can gain insight in the energy prices of various suppliers at any time and they can switch suppliers at any moment. Smart grids can save a lot of energy, on the one hand through real-time monitoring and network management and on the other hand by making market and pricing information available.

Integration of energy function with other functions such as housing and electric transport

There are common grounds between smart grids and domotics, ICT in support of residential functions. For instance, ICT can support occupants in their energy consumption. Nowadays, there are also smart household appliances that activate when the electricity is inexpensive. With smart agents technology and in an extensively liberalised market, consumers will be able in the future to consume at any time the cheapest power from the concerned local or regional supplier.There are also common grounds with the charging of electric vehicles in or near houses. Charging can be done at night when the electricity is the most inexpensive. This reduces the peak load on the grid. Furthermore, there are possibilities to use the vehicle’s battery to return energy to the grid in the case of an energy shortage and a higher price. Together with other vehicles’ batteries, the vehicle’s battery can possibly also serve as a storage medium to maintain a stable electric power supply.

Challenges for smart grids in the future

The challenges for smart grids reside namely at the regional level. It is a matter of designing the electric power supply on the basis of a new philosophy, reasoning not just from the perspective of centralised production to local consumers but also from the perspective of broad social involvement and participation. The evolution of the electric power supply will experience a stronger influence from institutional and social innovation. The supply will increasingly shift to end users, who will organise themselves locally. It will become a combination of centralised and decentralised production, which will work together efficiently and effectively. The relevant players in the development of smart grids for the future are the knowledge institutions, energy companies, regional grid operators, ICT and energy technology companies, decentralised producers, special interest groups, and citizens.

According to Han Slootweg, the professor occupying the endowed chair for Smart Grids, the technical and administrative design of the future electric power supply is not a technical and economic debate, but rather a political and social one, as values such as sustainability, efficiency, autonomy, privacy, safety, and reliability play a considerable role in that respect (H. Slootweg, page 11). Interests also play a role, as consumers, grid operators, and producers can have conflicting interests. ICT offers a lot of possibilities to have the overall system function optimally. These are possibilities for optimal management from the perspective of energy efficiency and sustainability as well as for the functioning of the electricity market and real-time pricing and invoicing. To what extent all this will work out will depend on institutional innovation and political choices, laid down in new laws.

The following aspects are important in the future structure of the energy supply:

Security of supplyIn spite of all the possibilities for decentralised generation and storage, the security of the electric power supply must remain guaranteed. This topic still requires a lot of research. One question is which ICT architectures best ensures this security of supply, including the ‘cyber security’. Another question is where the responsibility in that respect will reside and/or how the responsibilities can best be assigned among the players in electric power supply. The design of a smart grid will also have to be such that the physical components of the electric power supply remain operational in a default safe mode in the event of failure of parts of the ICT.

PrivacyReal-time monitoring of consumers’ electricity consumption involves privacy-sensitive data. Due to this aspect, the mandatory introduction of smart meters has been stopped by the Lower House of the Dutch Parliament. Careful consideration should be given to how and where what information from the smart meters and other sensors will be stored

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Smart Grids and Energy Storage

and processed, to prevent undesirable effects. An example of an undesirable effect is criminals being able to see when the energy consumption is reduced. Based on this information, they can infer when homeowners are absent.

Legislation and regulationsLegislation and regulations are important for the proper organisation of future smart grids. It is not yet clear how this will have to be done. In 2011, at the request of the Ministry of Economic Affairs, Agriculture, and Innovation (Economische Zaken, Landbouw en Innovatie, EL&I), NL Agency commissioned ‘Guidelines for the application of laws and regulations’ (Handvatten voor toepassing van wet- en regelgeving) for pilot projects, such as the Smart Grids Innovation Programme (Innovatieprogramma Intelligente Netten, IPIN). Various parties are now exploring the possibilities for streamlining, optimising, and modernising the 1998 Electricity Act (Elektriciteitswet 1998) and the Gas Act (Gaswet), as well as developments in European legislation.

PolicyFrom 2002, a lot of fundamental research into the various technical aspects of smart grids has been performed within the Innovative Research Programme for Electromagnetic Power Technology (Innovatieve OnderzoeksProgramma Elektromagnetische Vermogenstechniek, IOP-EMVT). Examples of aspects covered are the supply from uncertain sources of electricity, techniques for grid stability and voltage quality, standards for the quality of the grid voltage in connection with interference from decentralised generators and equipment, the remote measuring of power flows and their regulation by means of smart sensors, and the algorithmic forecasting of uncertain demand.From 2005, a lot of research into smart grids has been performed within the Energy Research Subsidy (Energie Onderzoek Subsidie, EOS) programme, in which attention was devoted to the ICT side, network management, consumer behaviour, as well as social and market aspects. Various concepts have been developed for smart grid architectures,

with attention to the energy infrastructure as well as the ICT infrastructure. IOP-EMVT and EOS have established a solid technological foundation for the design of smart grids. (IPIN) was formed in 2009 in order to acquire experience in smart local grids. This involves all relevant actors, such as end users, grid operators, suppliers of ICT and (smart) equipment, and housing corporations. Twelve pilot projects have been financed, which will run until 2015. Important aspects are the experiences with monitoring consumer behaviour, laws and regulations, new products and services, and income models. With the 2011 Energy Report (Energierapport 2011), the Ministry of EL&I offers the pilot projects the opportunity to deviate locally and temporarily from the existing laws and regulations for the purpose of experimenting with smart grids. For instance, it could be desirable to work with an allocation of roles among market parties that does not fully fit in with the current legal framework. In those cases, exceptions to the Electricity and Gas Acts will be granted for the duration of the pilot project, in consultation with the Netherlands Competition Authority (Nederlandse Mededingingsautoriteit, NMa) and if necessary, with the European Commission.

The challenge of smart grids is to control the demand for electricity and to spread it out over time in such a manner that existing grids require minimal expansion.

The current policy is mainly focused on further setting up the innovation system for smart grids, organising the players involved, the cooperation with local initiatives, international cooperation, laws and regulations, and the development of (usually international) standards.

In the context of the policy on top sectors, the Smart Grids Knowledge & Innovation Top Consortium (Topconsortium Kennis & Innovatie, TKI) will be formed within the top sector of Energy. A TKI is a public-private partnership in line with the Technological Centres of Excellence (Technologische Topinstituten). A smart grids innovation contract was prepared prior to the formation of the TKI for Smart Grids. The objectives of this contract are to get closer to the objectives of the Top Sector of Energy for a clean, affordable, and reliable energy supply: 1. reducing the costs for grid reinforcements; 2. 5% reduction of the energy consumption at end users of smart grids; 3. increase in activities of the business community in that respect. Experts are anticipating large-scale use of smart grids from 2020. The business model assumes, given an increasingly flexible energy supply, that end users and business will gain freedom of choice in the purchase and sale of energy and that they will obtain new products and services. Specifically, this will concern new products and services in the field of energy management, demand management, energy storage, integration of energy functions with residential functions, and charging services for electric vehicles. The focus is on the development of these products and services. In addition, the physical and virtual infrastructure will also be emphasised. The former will pertain to e.g. storage and sensors. The latter will concern e.g. ICT, ICT architectures, smart agents, and data mining methods. The innovation contract also devotes attention to the social and institutional innovation required for a sustainable energy supply with smart grids. Two calls for projects have recently been put out.

Literature• M.J. Kleijn, A. Mackloet & H. van der Kroon,

Green IT: quick scan. IIC PowerPoint presenta-

tion, April 2009.

• ICT-Office, ‘Vergroening door ICT levert tot 2030

besparing op van 2,8 miljard euro’, 20 June 2012.

• J.M. Meij (ed.), Stroomversnelling – de volgende

elektrische innovatiegolf, 1999.

• L. van der Sluis, Opgewekt door de buurt – smart-

gridonderzoek in Nederland, 2011.

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Smart Grids and Energy Storage | Netherlands Office for Science and TechnologySmart Grids and Energy Storage Smart Grids and Energy Storage

• Han Slootweg, Smart grids – fundament voor de

toekomstige energievoorziening, 2010.

• M.J. Blom et al, Maatschappelijke kosten en

baten van Intelligente Netten, 2012.

• Taskforce Intelligente Netten, Op weg naar

intelligente netten in Nederland, 2011.

• Innovatietafel Smart Grids, Innovation Contract

Smart Grids, 2012.

• Ministerie van EL&I, De slimme meter

– Informatie over de nieuwe energiemeter, 2011.

• AgentschapNL, Handvatten voor toepassing van

wet- en regelgeving, 2011.

• KEMA, Laat zien wat je in huis hebt? De noodzaak

van een display in een woning als aanvulling op

de slimme meter, 2011.

• KEMA, Smart meters in the Netherlands. Revised

financial advice and policy advice, 2010.

More informationPeter van den Berg & Olivier Ongkiehong

www.nlinovatie.nl

Or contact your local NOST office at the Embassy.

The Netherlands

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Smart Grids and Energy Storage

Micro-grid Bronsbergen holiday resort in Zutphen

Grid operator Liander has installed a semi-autonomous electric power supply on the premises of the Bronsbergen holiday resort. This project is financed by Liander and the EU. Electricity is supplied by three thousand square metres of solar panels on more than 100 holiday homes. The unused energy is

stored in batteries. There are experi-ments with smart grid management and maintaining the voltage level and voltage quality. In practice, tests are performed of what the models predict theoretically. The grid is now functio-ning properly and can start itself up, switch over to and back from the public

electricity grid. The electric power supplies of the public grid and of the autonomous system are so attuned to each other that the grid losses are minimal. Through this ‚micro-grid‘, a unique testing site has been developed. Meanwhile, Liander has tested storage in houses as well as the use of flywheels.

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PowerMatching City

PowerMatching City is one of the smart grids pilot projects. In 2009, a smart energy grid pilot project was launched in Hoogkerk in Groningen, a worldwide first. This grid comprised 22 house-holds, condensing boilers, hybrid water pumps, solar photovoltaic systems, smart devices, and two electric vehicles. KEMA, Gasunie, a software company, an energy supplier, a grid operator, and a few knowledge institutions were among

the participants in the project. Moreover, a market model was linked to the grid, in which consumers could freely exchange electricity and the energy prices changed every five minutes. The second phase of the project assesses how smart grids can be fitted into the processes of the energy company, from meter reading to invoicing. Furthermore, attention is devoted to capacity management of the

grid as far as the supply from sustaina-ble sources is concerned. This typically is a demonstration project and an open innovation system, in which various matters are tested, from the require-ments and preferences of consumers to the chips for charging electric scooters and ICT for communication between all parts of the energy grid.

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ColophonThis is a publication of:NL AgencyNL EVD International

Visiting addressPrinses Beatrixlaan 22595 AL Den HaagT (088) 602 15 04E [email protected]

Postal addressPO Box 931442509 AC The HagueThe Netherlands

© Rijksoverheid | November 2012ISSN: 1572-6045

NL Agency is a department of the Dutch Ministry of Economic Affairs, that implements government policy for sustainability, innovation, and international business and cooperation. It is the contact point for businesses, educational institutions and government bodies for information and advice, financing, networking and regulatory matters.

The division NL EVD International stimulates international business and cooperation and promotes a positive image of the Netherlands abroad.

NOST NetworkThe Netherlands Office for Science and Technology (NOST) Network or in DutchTechnisch Wetenschappelijke Attaché Netwerk/IA Netwerk, is a collective of officers working for the internationalisation of Dutch R&D. The NOST offices, always part of a Netherlands embassy or consulate, are stationed in France, Germany, Israel, Russia, USA (incl. Canada), Brazil, China, India, Japan, Taiwan, Singapore, South Korea, and at the

EU. The NOST Network offers Dutch companies and research institutes a free subscription on the Nieuwsbrief IA Netwerk and IA Special. These items will inform on international technology developments through articles written by the Officers.

Quoting & referringPlease note that you are free to quote or refer to this document provided you mention the source in your publication and inform the Central Office for Science & Technology at the NL EVD International by sending a copy to:Agency NLNL EVD InternationalCentral Office for Science & Technology (IA Netwerk)PO Box 931442509 AC The Hague THE NETHERLANDS(Email: [email protected])

Illustrations, and tables The quality of tables, diagrams, web links and illustrations in thispublication, cannot be guaranteed. You may wish to enquire aboutfurther details or background information do not hesitate to contact usor the Netherlands Science & Technology Officer in your country orpart of the world.

Further information If you have any question due to this publication or event, please let us know. You can send an email or call directly to the officer concerned. Or use the “Ask your question” module of our website: www.ianetwerk.nl by clicking on “Stel uw vraag”. You can also email your question to the NOST/IA central office in The Hague. They will forward your question to the appropriate NOST officer.

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