20-20-20 and the Smart Grid



The EU’s 20-20-20 target in the 2007 Energy Policy and the 2009 Third Energy Package has spurred development of the smart grid. To achieve the goal the EU has included the smart grid as one of the region’s seven priority energy technologies in its Strategic Energy Technology Plan (SET Plan). To implement the plan the EU set up two initiatives: the European Electricity Initiative (EEI) and European Electricity Grid Initiative (EEGI).

Major EU projects include the ADDRESS (Active Distribution networks with full integration of Demand and distributed energy Resources) to demonstrate active distribution networks and SUSPLAN, which is ‘investigating the development of regional and Pan-European guidelines for more efficient integration of renewable energy into future infrastructures’. Through the European Energy Programme for Recovery (EEPR) (a programme to provide financial support for projects in the energy area which would aid in economic recovery, lower carbon emissions and help to provide a secure energy supply) a total of €2,365 million is available for electricity and gas infrastructure interconnections. Some of which may be used for ‘smart’ interconnection technologies.

A mandate has been introduced requiring 80% coverage with smart meters by 2020 and an entire roll out by 2022. To drive the market member states must conduct an economic assessment of smart metering by 2012.The Third Package of the 2009 Energy Directive on gas and electricity required the implementation of intelligent metering system to assist consumers on the market. In addition  the third Energy Performance of Buildings Directive (EPBD) stipulates that Member States ‘shall encourage the introduction of intelligent metering systems whenever a building is constructed or undergoes major renovation’.

To date the majority of smart grid projects have focused on smart meter deployment. Finland, Sweden and Italy have been early adopters in the smart meter market, followed by France, Spain, the UK and Ireland. Government policies, especially smart meter mandates, are driving growth in the smart meter market. The only country with full scale deployment is Italy, with Enel creating its own business case for early deployment of the technology. In order to ensure consistency a mandate for standardisation of components has been introduced.

Calculations to determine reserve values

perform-quick-calculations-google-searches-fly.1280x600.jpgThere are two primary ways to determine reserve quantities: the volumetric method and decline curve analysis.

The volumetric method

This calculation is derived from the formulae –

Gas-in-Place = 43,560 * A * H * f * Sg * Bg

Reserves = (Recovery Factor) * (Gas-in-Place)

This method may appear to be fairly ironclad until we consider the uncertainties that are inherent in each of the measurements required as inputs to the equations. It relies on the accuracy of the maps made by the geologist and geophysicist, which are derived from interpretations of complex data that, for the most part, are derived from physical parameters beneath the surface. These parameters are the inputs for the areal extent of the hydrocarbon accumulation (A), the thickness of the pay zone (H), the porosity of the rock (f), the gas or oil saturation (Sg or So) and fluid composition (Bg). Interestingly, but also a mathematical reality, is that if each variable is off by only 10%, then the gas-in-place will be off by approximately 40% and the reserves could be off by approximately 50%.

Decline curve analysis

Decline curve analysis is widely accepted as the more accurate method for reserve determination, presuming ample production history is available to make the predictions. This is a little bit like trying to determine what a child will look like once he grows to maturity. When he is an infant, we might look at the size of his feet or hands to estimate his mature weight or height, or by analogy consider the height and weight of his mother and father. As he reaches the teenage years, we can be more exact in our prediction, but ultimately we only really know once he is fully grown.

An example using a tight gas sand producing well may help to understand the hazards in this method:

Stage 1

Based on decline curve analysis, after the first 100 days of actual production with output measured in thousand cubic feet per day (Mcfpd), this well would only show an expected ultimate recovery of about 230 million cubic feet (MMcf).

Stage 2

As time goes by, more production data is obtained, and decline curve analysis would predict that the well is capable of recovering more gas.

Stage 3

After about five years, a much clearer picture appears of what the well will actually produce.

This example helps explain the uncertainties in extrapolating decline curves to a well’s ultimate recovery or reserve quantity. In this case, the reserve prediction continued to increase with time. It is not uncommon, however, to have the opposite occur in instances such as a well prematurely ‘watering out,’ having mechanical failures resulting in early abandonment or any number of unexpected problems.


Solar and Wind Integration into the Grid


Solar and Wind energy have seen significant growth in the last decade and are forecast to grow even more in the years to come. As governments have set themselves targets of reducing greenhouse gas emissions, they have fostered the development of these technologies through subsidies and other incentives.

However, as the scale of manufacturing increases and as technology has developed, the costs of solar and wind power has come down significantly, making it more feasible for many projects. With this growing production of electricity through wind and solar, there have been a number of interesting parallel developments in the grid and other infrastructure.

Without sufficient scale, wind and solar wouldn’t be able to flourish as they have. Interconnecting a national grid with that of a country’s neighbours and creating a larger grid allows for more assets to be utilized as best as possible. This in turn can reduce the need for spinning reserve, vital to smaller-scale networks.

Effective means of energy storage are also needed to allow for the further integration of renewables into the grid. It is the automotive industry that appears to be picking up the reins on these developments, by integrating their electric vehicle and battery storage technologies into the grid. Companies such as Tesla, BMW, and Renault-Nissan are all developing storage solutions, either at the consumer level, grid level, or both.

With the increased integration of these technologies, so too arises the need for control systems and monitoring. Smart meters, and other smart devices are being rolled out at increasing rates to allow for TSOs and DSOs to better manage the grid. This also leads to a more efficient use of resources and prevents waste of energy through load balancing and more effective demand response during times of high renewable energy production.

Data Privacy issues in the Smart Grid

pic-smart-grid.jpgData privacy in the Smart Grid refers to a range of potential problems from the improper use of the information. It is technically possible that an employee at a utility could use information from a smart meter to determine when customers are out of their house or have purchased new electrical items, and thus when to steal the owners possessions or stalk them.

Utilities or other companies could use the information for marketing purposes or use consumption behaviour data to introduce non-competitive pricing. By introducing very low pricing targeted towards the individual consumer to drive competitors off the market.

Not to mention utilities need to store all of this data and also source sufficient storage facilities that has both the capacity needed and is very secure. It is not unfeasible that utilities may need store exabytes (million terabytes) of data, which will be costly. However, every year the cost of storage halves and the storage of this information may cost US $4,000 in 2025.

It is also possible that applications will be developed whereby real-time energy usage is uploaded onto a twitter page or facebook account using a special application. Consumers may inadvertently give this information to hackers or so called ‘friends’ that use this information to stalk the consumer or burgle their house.

There needs to be regulation in place to ensure that similar incidents don’t take place with data generated from the smart grid. While data privacy laws are in place in most of the major smart grid markets, nothing specifically refers to the smart grid. In September 2010 a law with new privacy protections for consumers’ energy use data was signed in California. This legislation includes specific information on information disclosure, data security/protection, liability, and continued use. Since then, policies have been implemented and there are frameworks in place to ensure consumer privacy as these systems have been rolled out.

National variances in the Natural Gas Sector in Western Europe


Country differences in the household penetration of natural gas are due to a combination of factors. The most fundamental of these relate to the abundance of indigenous supplies of natural gas, the geographical size of the country, eh extent of the piped network, and the length of time for which natural gas has had a share in the national energy market.

Labelling countries according to the status of gas distribution is a difficult procedure, and categories such as ‘mature’ and ‘developing’ require further explanation. In one country gas may have low penetration but for various reasons it may be regarded as a mature market, whereas in another country it may have high penetration but be capable of expansion and so label developing or immature. For example, while the French gas market may be said to be ‘mature’, this is more due to the fact that the natural gas market has existed for a long time in France, rather than that it has expanded to its full potential. Indeed, it is likely that a great deal of development (both in terms of infrastructure, and the use of natural gas in households) will take place in the future. A high level of national reliance on nuclear power generation may go some way towards explaining the lower penetration of natural gas in the French domestic sector.

Similarly in Germany, which accounts for around 20% of the total natural gas consumed by households in the EU, and 16% of domestic consumers in the wider Europe, much distribution network development is likely to take place in the future, as at present only around 46% of households are connected. In the UK and the Netherlands, where the domestic natural gas market has also been established for several decades, because of their natural resources it is at or approaching saturation. In these two countries, the main developments are likely to involve fuel-switching and/or increased demand by individual households, and only a small increase in the proportion of households connected.

What you can expect to study with GEC


The Global Energy Certification curriculum covers many topics and sectors of the energy industry. Below is a sample of what you can expect to study.

The major T&D suppliers are following the broad industrial trend of aiming to increase their business by adding value to products by combining them in systems and offering higher technology services and capabilities. They have mostly published targets to increase the proportion of their business including service as well as ‘classical’ products. This gives a competitive advantage to the large players in the market who have the resources to deliver such levels of technology, and in this respect they have a competitive edge over the lower tech producers in low cost markets. However, there are many users who still require only the basic products at lower cost, providing low cost in-house servicing and these occur in all markets regardless of their development. This ca also create a distortion in capex estimates because some of the service functions may be accounted for in opex in utility reports.

Power systems and utility automation can be described as power technology systems as opposed to products and they include both products and the value added to the products with additional services, technology or engineering. Sub-stations are within power systems. The increased competition engendered by market liberalisation in recent years has encouraged the development of sophisticated asset management tools and systems. Asset management monitoring systems and thermal imaging come have a natural fit with utility automation.

In targeting a market it is necessary to decide what the ‘addressable’ market is. Within the total T&D market, the addressable market for a low technology manufacturer of small transformers is different from the addressable market of a high voltage substation system manufacturer, although both include transformers. The manufacturer of 50 metre steel transmission line towers carrying heavy 750 kV lines would not regard the reticulation lines in a developing country which use wooden poles carrying low voltage lines as part of the addressable market.

There are many facets to the Energy Industry and GEC will help you put the pieces together.

Renewable Energy Records being Set and Broken in Europe


On April 30, 2017, Germany was able to produce 85% of its energy demand using renewable sources. Germany deploys a wide arsenal of Wind, Solar, and Hydropower facilities in its efforts to become a fully renewable energy nation by 2030. As time goes on, we are likely to see days such as this past April 30 with near 100% renewable energy generation become more frequent.

After the 2011 Fukushima nuclear crisis, Germany pledged to accelerate the phasing out of its nuclear generation. As these policies began to take shape, it was looking like coal was going to be the successor to nuclear power in Germany. An unwelcome side-effect of the nuclear phase-out has thus been an increase in carbon-heavy electricity generation when renewables have not able to keep pace due to their external limiting factors.

However, when the stars do align, and conditions are favourable, Germany’s green pedigree is commendable. Attributed to the “Energiewende” policies, Germany is on track to becoming the leader in Europe when it comes to renewable energy production and consumption. We must not neglect to mention other European countries such as Denmark and Spain. These countries are right up there with Germany in producing high levels of renewable energy and at times showing electricity generation surpluses thanks to their renewable energy capabilities.

Key in these developments is scale. Without interconnections to neighbouring countries, generators in Germany, Denmark, and Spain would be heavily penalised for producing electricity that outstrips domestic demand. We cannot control the weather upon which many renewable sources are reliant. Creating a super grid will allow system operators to better take advantage of these moments of high renewable production by allowing them to offload surplus energy to other regions with peaking demand.

The future is looking bright for renewable energy in Europe, and we can expect more records to be shattered as time goes on.