Electricity pylons at sunset

Tomorrow’s power system will require more flexibility and investment in new technologies

Solar and wind are a rapidly growing part of the global energy mix. But while a record amount of generating capacity using renewable resources was added in 2016, existing power-network infrastructures are increasingly ill-equipped to deal with the variable nature of solar and wind-generated electricity.

Renewable generation capacity is often located far from the centres of greatest demand or produces most power at times of low consumption. Distributed power networks are challenging centralised generation networks built several decades ago.

Tomorrow’s power system requires more flexibility and investment in new technologies. But as policy focus moves from generation towards better integration of renewables, there are risks that new renewable capacity will have to be curtailed or postponed until grids are upgraded.

Decentralised power generation is blurring the distinction between producers and consumers

A decade ago, 20 per cent penetration levels for variable renewables were considered the upper limit of tolerance for electricity grids to deliver power reliably without additional investment. But already four European countries – Denmark, Ireland, Poland and Spain – are above this level, with Germany, Italy and the UK approaching the threshold.

So it is no surprise that Europe is leading the way in transforming its grids to cater for more variable renewables.

One new trend in power generation involves the growing centrality of energy management. Power grids will benefit from intelligent equipment and upgraded communications to help deal with a decentralised structure and greater variability of supply.

Software and energy-management systems can also help process the additional data required to optimise power loads. Furthermore, as the cost of battery-based energy storage falls, new system models are emerging based on a renewables-heavy, decentralised and digitalised grid.

Decentralised power generation such as solar is blurring the distinction between producers and consumers. Rooftop residential solar power is increasingly inviting consumers to use the grid as little as possible. Battery storage and electric-vehicle charging will compound this issue.

One problem is over-generation – supply outstripping power demand. Increasing levels of solar capacity in California, for instance, means over-generation in the early afternoon, when most solar power is generated, but the rapid rise in power demand at sunset causes a significant swing in net load requirement that must be met by alternative generation or storage.

Adding a digital layer that brings local, national and regional dimensions together is a growing necessity and control technologies embedded in individual products can automatically divert power flows to overcome outages.

Storage provides flexibility and can be deployed both on the grid and at consumers’ own homes or businesses. Battery-based systems are the fastest-growing storage technology, with lithium-ion battery development allied closely to the expansion of electric vehicles. But although costs are falling sharply, full cost-competitiveness remains many years away even if, longer-term, storage could be a game-changer for the grid.

The growth of battery storage risks being hampered by the lack of policy. But the next step could be greater integration with IT companies. There is much scope for power-equipment suppliers and utilities to deepen ties with large technology companies to develop the next generation of energy services.

This research was first published on 13 July 2017.

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