Robert Hughes, Business Development Director for the Virtue energy storage solution explains why moving towards a smart, flexible energy system driven by energy storage, Demand Side Response (DSR), smart networks and interconnection can contribute towards increasing renewables as a proportion of the energy mix, therefore ensuring customer’s bills are lower and supply is secure.
The National Grid is struggling to cope with the surge in demand for electricity. At present, the vast majority of commercial buildings rely on the grid to provide energy and although demand is currently high, it is expected to rise further, with 60 percent increases predicted by 2050.
In an attempt to manage peak demand, the Government recently gave the ‘all clear’ for construction to begin at Hinkley Point nuclear power station. However, from present until completion, there are simply not enough energy resources to control the forecasted growth, and it is not guaranteed that Hinkley Point will be able to satisfy the huge level of consumption.
To support an increase in demand, the National Grid will be forced to further invest in network reinforcement to ensure a secure and stable supply, unless power demand can be balanced to make the network more resilient, efficient and cleaner, with an emphasis on reducing waste.
Although the demand for electricity is increasing, the fact remains that for more than 125 days per year; up to 50 percent more electricity is generated than is required, resulting in a significant waste of energy and resources. In order to achieve a closer generation and demand match, this wasted energy needs to be harnessed, and energy storage is emerging as a much needed solution.
Currently, to control demand and prevent overuse on the grid during these times of high demand and stress on the infrastructure, there are significant charges placed on users for consuming energy at certain times of the day, which are in addition to electricity fees.
Distribution Use of Systems (DUoS) and Triad tariffs are two examples, together the two charges represent 24 percent of a facility’s average electricity bill, and the amount continues to rise year on year.
Energy storage has emerged as a much needed solution to tackle these issues. At times of low demand, when there is an excess of supply, energy storage can save and store electricity for use during the peak demand period, when the National Grid is under stress.
Not only does energy storage allow companies to utilise the stored energy to make savings, and avoid the DUoS and Triad charges, it also enables them to redirect electricity back to the National Grid, in order to access additional revenues through Demand Side Response (DSR) incentives.
DSR can be any method of assisting reserve, frequency response, peak avoidance and capacity on the electricity network. DSR incentives are broken up into three categories: Demand Side Balancing Reserve (DSBR), Firm Frequency Response (FFR) and Enhanced Frequency Response (EFR). Through energy storage, companies can benefit from average revenues of £120,000 per MW through eligibility for these incentives.
Energy storage systems can also be integrated with renewable energy generation to save and store energy produced from on-site renewable sources, thus improving the reliability, maximising the benefits, in turn reducing the reliance on fossil fuels.
The chart (Fig 1) shows a typical load profile (green-yellow-red) of a site fitted with 200kW of solar panels on a particularly sunny summer’s day. The direct effect of solar on the load profile is quite substantial, reducing the site’s overall consumption of electricity by 32.6 percent. However, the majority of this load occurs during non-peak hours, when the demand on the grid is at a minimum and grid tariffs are at its cheapest. Solar only reduces load requirements during peak, high demand times by 18 percent.
After installing an energy storage system (Fig 2) the same site has the ability to utilise solar in such a way to prevent it from ever demanding more than 200kW per hour of energy from the grid, as well as removing the site completely from grid power during times of high demand and peak tariff, resulting in not only reduced strain on the grid infrastructure but also significant financial savings for the user.
Through integration with renewable technologies, energy storage systems are enabling energy generated from renewables to be stored locally and efficiently, driving the evolution from the traditional grid-tied provision of electricity to a smart, flexible supply which is able to meet demand requirements.
The future grid outlook will see traditional models replaced with a smart grid energy system, a highly connected system of responsive power generation from both suppliers and consumers which results in a clean, secure and reliable supply of electricity for homes, businesses and vehicles, considered the ‘Internet of Things’ (IoT) solution for smart energy.
The smart energy system, based on microgrid level generation and flexibility will help to ensure customer’s bills are reduced and supply is secure. It will also avoid potentially costly investment into network infrastructures and will minimise the need for an increase in reserve generation capacity and the requirement for backup thermal generation.
Energy storage and solar can balance the generation and demand gap by reducing the stress on the network and making the supply from renewables less volatile and more predictive. Potentially, this could result in National Grid network reinforcements being deferred or even avoided, in turn leading to potential savings of up to £12 billion by 2050.
In addition, by maximising the benefits of renewable generation and increasing flexibility, there is scope to increase the proportion of electricity supplied that is renewable without increasing total renewable capacity. Companies can also use the ability of energy storage systems to monitor the availability of power to their advantage.
With the restructuring and lowering of FIT subsidies in 2016, there is conceivably no better opportunity for renewable projects to become part of an integrated microgrid solution, in which energy is harnessed and provided to the final user through energy storage.
Additional benefits include eliminating the use of inverters on renewable installations, which help reduce costs and improve return on investment and by providing full facility Uninterrupted Power Supply (UPS) for up to two hours during any electricity loss on the grid; it allows the need for a separate UPS systems to be negated.
Even though energy storage technology is in its infancy in the UK, it is a firmly established technology in many countries and is emerging as one of the best solutions to address the growing concern that National Grid is struggling to match generation and demand for electricity, emphasised further with predictions that the UK peak demand on the grid is expected to increase six-fold by 2050.
Whether connected as part of smart grid energy system or not, energy storage systems integrated with renewable technologies are fast becoming the future of electrical distribution, not only in the UK but around the world.