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Investing for Grid Flexibility: Exclusive Interview with Steve Atkins, DSO Transition Manager at Scottish and Southern Electricity Networks - [an Energy Central Power Perspectives™ Interview]

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image credit: Steve Atkins
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Matt Chester 185541
Energy Analyst Chester Energy and Policy

Official Energy Central Community Manager of Generation and Energy Management Networks. Matt is an energy analyst in Orlando FL (by way of Washington DC) working as an independent energy...

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Flexibility has quickly become one of the pillar grid assets that utility companies are looking to leverage when building the grid of the future. No longer do leaders envision an energy system run entirely by a central power plant with electricity sold and distributed directly to end-user, and in its place is a more interconnected, quick to adjust, a partnership that sees flexibility as key.

This transition to a more decentralized and distributed grid cannot happen overnight, though, and the need for smart investing, forward-looking decisions, and overall leadership is still robust. These needs are going to be the focus of Steve Atkins’ presentation at the upcoming Smart Grid Flexibility 2019 conference this week. Steve, a DSO Transition Manager with Scottish and Southern Electricity Networks, will share his talk entitled “Investing for Flexibility – developing a robust investment decision-making framework for weighing up flexibility investments with traditional grid reinforcement.”

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To give a sneak preview of his talk, Steven spared a few moments to discuss this hot topic with me to share his insights with the Energy Central community:

 

Matt Chester: The Smart Grid Flexibility Conference proves to be one with some of the most knowledgeable and experienced people in the world of utility data and technology. Can you give us a background of how you fit it? What’s your background in the utility space and how did you get involved in data-driven decision making for the industry?

Steve Atkins: My role is to understand the role of the DNO in the emerging smart grid, and data is absolutely fundamental to its future.  It is key to unlocking system and consumer benefits and managing the transition to a low carbon economy.  With energy increasingly decentralized, millions of assets – solar panels, batteries, electric vehicle charge-points, and heat pumps – will need to be able to communicate with system operators and market platforms. Transparent, accessible, interoperable, and accurate data will allow the markets to develop that will put consumers at the heart of this change while allowing system operators to support the proliferation of new business models and technologies.

 

MC: The overarching idea behind your presentation is the work you’ve done towards creating a framework for evaluating options around network capex investments to support ta wider industry approach. Why is this an area in which you see a valuable opening? What is currently being uncaptured due to utilities not embracing this type of tool?

SA: As a natural monopoly, system operators need to be able to facilitate the emerging flexibility market in a neutral manner so as not to distort competition.  The decisions we make around flexibility services and reinforcing the network should be transparent and consistent and the tool we are working on with Frontier Economics helps provide that visibility and rigor.

 

MC: Have you found that this type of project and advancement is one that the utility industry has had a healthy appetite for, or do you find yourself having to pitch the idea and convince leaders about how useful it could be for them before attaining buy-in?

SA: System Operators have seized the initiative through the ENA (their trade body) to influence the outcome in the development of a U.K. energy industry that addresses the challenges the future will bring. Through the Open Networks Project, system operators are working hard to establish in the minds of policymakers the vital role networks will play in developing an energy sector that can handle the demands that come with tackling climate change and keeping energy supplies secure. At the same time, we have backed strongly efforts to put in place the skills to realise the ambitions for the future of the energy sector and indeed those of the U.K.

MC: You’ve clearly made some great and impactful progress with this prototype decision tool. What are the most significant challenges you feel you are coming up against next as you look to bringing this framework and tool to new heights?

SA: As you will hear in my presentation, the key issues are establishing the most valuable inputs for this framework to ensure the range of available options is evaluated correctly.  For example, in such a nascent market how to arrive at a correct value for flexibility when competition has not had the opportunity to influence the price and how do you value the optionality that flexibility offers?

 

MC: As you look at the list of speakers and attendees of the Smart Grid Flexibility conference, what jumps out to you as one of the particularly hot topics that the industry is buzzing about? What do you most look forward to learning about while attending?

SA: The outputs from the recent Energy Data Task Force will have some wide-reaching (and welcome) implications for the industry and I’m keen to find out how other industry partners are addressing those recommendations.

 

If you're interested in learning more about flexible investments on the grid, be sure to attend Steve Atkins’ presentation this topic at the Smart Grid Flexibility 2019 conference this week in London, UK. You can learn more about the agenda and register for the conference here.

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Bob Meinetz's picture
Bob Meinetz on Sep 30, 2019

Matt, for utilities, what advantage do you see in making a simple grid powered by central generating plants infinitely more complex?

It certainly won't be more reliable, flexible, efficient, or transparent.

Matt Chester's picture
Matt Chester on Sep 30, 2019

I've invited Steve to come answer your questions directly, but he's likely busy for the next few days at the aforementioned conference. In the meantime, I'll pull in some other reserves.

For reliability, I'll refer to the Department of Energy:

A key feature of a microgrid is the ability to separate and isolate itself from the utility during a disturbance with little or no disruption. When the utility grid returns to normal, the microgrid then automatically resynchronizes and reconnects itself to the grid. 

 

For flexibility, I'll point you towards Advanced Energy Economy:

DERs provide flexibility value when they operate in a way that allows grid demand and supply levels to balance. This value is realized at multiple timescales, from very fast (e.g. frequency regulation on the order of seconds) to longer-term (e.g. load shaping on the order of hours).

The efficiency of these decentralized solutions, C2ES points to these benefits:

Microgrids can also help improve overall electric system efficiency by managing generation and load on a micro-scale to minimize demand during peak periods and influence system reliability standards

And lastly for transparency, I'll tag in Berkely Science review:

For transparency, the conclusions reached by the smart meters are recorded on the blockchain, and billing and payments are handled by a smart contract for anyone to check and verify. This system can be implemented on an entire city, continuously adjusting to changing data or added smart meters.

Richard Brooks's picture
Richard Brooks on Sep 30, 2019

Good response, Matt.

Bob Meinetz's picture
Bob Meinetz on Oct 1, 2019

Matt, DOE explains why microgrids make sense for manufacturers, hospitals, and other single private entities, in emergency situations. It has nothing to do with public power, where they make no sense at all.

Here's why: every existing microgrid is powered by either gas or diesel generators, and anyone who believes multiple fossil-fuel generators, cycling as needed, supply their combined electricity more efficiently than a single gas power plant either dropped or failed Thermo 101.

We can subtract 15% off the bat for bi-directional inversion losses - turning AC to DC, back to 60-cycle AC.

Then there are line losses. Richard maintains "DER energy in close electrical proximity to it's load eliminates losses from transmission/distribution." No, transmitting the same electrical energy, in close proximity, at low voltage, increases losses due to transmission. DOE's real-world example:

"Brevoort, a 1950's era coop tower in Greenwich Village, NY, maintained power, water and heat during the wide spread power outages left in the wake of Superstorm Sandy thanks to Tecogen's combined heat and power (CHP) system.  The four Tecogen InVerde units providing power to the building are designed to provide not only efficient, economical and clean power day in and day out, but to continue functioning even in the case of a grid failure and black-out.  

Assuming Brevoort is generating 110V AC for residents, line losses are:

Ploss = P²R/V² = P²R/110² = P²R/12,100

Line losses from Ravenswood (combined cycle generating plant 4 miles away in the Bronx, transmitted at 345kV):

Ploss = P²R/345,000² = P²R/119,025,000,000

119,025,000,000/12,100 = 9,836,776

Forget for a moment 25% of Brevoort's electricity had previously been generated carbon-free by Indian Point Energy Center: from the point of generation to power mains at Brevoort, Ravenswood is transmitting electricity in bulk 9.8 million times more efficiently than transmitting it from onsite generators. If the generator is only 10 feet away from the mains, Ravenswood could be in Chicago and transmit electricity with less line loss as a percentage of power.

From C2ES:

"Microgrids mostly use combined heat and power and reciprocating engine generators, which use fossil fuels. Microgrids are expected to become greener as future projects incorporate more solar power and energy storage."

The day we can expect microgrid owners to collectively replace low-priced gas generators with expensive solar panels/storage for the sake of the environment, is the same day we can expect hundreds of millions of Wal-Mart shoppers to collectively forsake cheap Chinese goods to help rebuild our economy (never).

There are a lot of assumptions here, they're based on limited data. But everyone in the renewables community jumps on this microgrid bandwagon with even more assumptions and no math at all. My math says shifting the public from central generation to community microgrids is a disaster in the making (if you have better math I love to be corrected).

Matt Chester's picture
Matt Chester on Oct 1, 2019

Here's why: every existing microgrid is powered by either gas or diesel generators, and anyone who believes multiple fossil-fuel generators, cycling as needed, supply their combined electricity more efficiently than a single gas power plant either dropped or failed Thermo 101.

Gas and diesel are still relevant for these grids, that's true. But to say it's all gas or diesel is purposely ignoring the penetration that renewables (namely solar) are making for the microgrids as well. 

The day we can expect microgrid owners to collectively replace low-priced gas generators with expensive solar panels/storage for the sake of the environment, is the same day we can expect hundreds of millions of Wal-Mart shoppers to collectively forsake cheap Chinese goods to help rebuild our economy (never)

I agree that we can't rely on anything other than market forces to really drive these changes. Lucky for us, the trend of renewable costs dropping lower and lower and starting to undercut gas and other fossil fuels is continuing on!

Bob Meinetz's picture
Bob Meinetz on Oct 1, 2019

"...the trend of renewable costs dropping lower and lower and starting to undercut gas..

Renewables are nowhere near undercutting gas, nuclear, or anything else, for that matter. Like equating capacity with generation, disingenuous renewables pricing fails to account for the value of availability - as if sources of energy limited to 9-5 on sunny days are just as valuable as those available 24/7.

Would you pay the same price for a rental car you could only drive 9-5 on sunny days? Of course not - yet we both make payments for guaranteed future solar/wind "capacity" whether it's available when promised or not. Like "renewable energy certificates", another lie in the jam-packed renewables playbook.

 

Matt Chester's picture
Matt Chester on Oct 2, 2019

Clean energy portfolios, defined as an optimized combination of wind, solar, storage and demand-side management, are cheaper than 90% of the 88 gas-fired projects proposed across the U.S., according to RMI, which could save customers an estimated $29 billion and reduce carbon emissions 100 million tons per year if they replaced those proposed gas projects.

- Rocky Mountain Institute

🤷‍♂️

 

Bob Meinetz's picture
Bob Meinetz on Oct 2, 2019

Ah, "Rocky Mountain Institute", headed by Chief Scientist/Dropout/Draft Dodger Amory Lovins, recipient of $millions in unacknowledged funding from oil companies, now has a hypothetical 100% renewables portfolio which "could" save hypothetical customers in some alternate universe an estimated $29 billion by the year 2032:

"Lovins attended Harvard for a year or so before dropping out to do some soul searching and mountaineering, and then moved to the UK to attend Oxford for a while during a period when the US had a military draft. (See The Hydrogen Powered Future) He did not graduate from there either. His mentor and hero was David Brower, founder of Friends of the Earth and he worked as the UK’s FOE campaigner for a number of years. He has written a lot of articles and some well publicized books. He travels around the world giving well attended speeches and collecting fees of up to $20,000 per talk. He now runs an institute that has an annual budget of close to 10 million dollars, much of which comes from consulting fees from Fortune 500 companies – including major oil companies – and the Department of Defense. He describes himself as a “consultant experimental physicist educated at Harvard and Oxford” and he is often billed as the “Chief Scientist” of the Rocky Mountain Institute."

Matt Chester's picture
Matt Chester on Oct 3, 2019

I find attacking an author or resource with which you don't happen to agree and bringing up unrelated topics about them, rather than addressing arguments themselves, a tad unsavory. That said, I can certainly point to other organizations with similar conclusions about these coming trends:

World Resources Institute

Lazard Bank

IRENA

Even IEA sees the writing on the wall: 

The ongoing cost declines for solar allowed for such a blistering growth rate. Record-low auction prices for new utility-scale solar seemed to crop up everywhere, including India, the UAE, Mexico and Chile. In some places, solar was posting 3-cent-per-kilowatt hour auction prices, a level that is more competitive than just about any other source of energy, including cheap natural gas...."Renewables may well become even cheaper than fossil fuel alternatives [over the next five years],” Paolo Frankl, head of the renewable energy division at the IEA, told The Guardian. The IEA’s executive director, Fatih Birol, put it more bluntly. "The era of expensive renewables is over," he said.

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