The
U.K.
's
largest energy supplier Centrica is this year to start monitoring the behavior
of 14,000 electricity customers in a smart grid trial project that will also
test the impact on the grid of adding low-carbon energy technologies such as
electric cars and solar panels.
The three-year project, which Centrica is conducting in partnership with
distribution network company CE Electric and Durham University, aims to help
homes and businesses cut their energy use and speed up the integration into the
grid of technologies such as ground source heat pumps and combined heat and
power boilers. These will supply power back into the system and also test the
network.
It's one of several smart grid trials taking place across
Europe
as the region targets
big increases in energy efficiency in efforts to meet stringent European Union
2020 climate change targets. The smart grid is unlikely to play a huge role in
meeting the 2020 targets, but it will be essential if countries are to meet
their more ambitious 2050 targets.
"You can't move to a low-carbon economy without changing how the networks
work, and you can't do that without changing the way that customers consume and
you can't do that without effectively making this [the grid] a data
economy," says Petter Allison, managing director of technology and
innovation at Centrica's retail arm British Gas.
According to consultant Accenture's recent Carbon Capital report, a smart grid
with smart meters deployed in households could save a whopping €87 billion
($122 billion) in energy costs across
Europe
by 2020.
But energy efficiency doesn't come cheap: According to Accenture's report,
about €552 billion will need to be invested in smart grids and meters from now
until 2020 for this to be possible.
The introduction of smart grids would bring two-way communications to the
networks and allow people to see how much energy they're consuming via their
'smart meter'. It will also give them the choice to consume energy at a time
when demand is lower and tariffs are cheaper.
The increase in energy usage data will also allow electricity companies and
network operators to see, for the first time, when and where energy is consumed
down to the micro-level of a neighborhood, street or even a house, enabling
them to see bottlenecks and use assets more efficiently.
Currently, most of the high-voltage transmission networks across
Europe
have such data
systems providing them with information about the big industrial users. But the
low-voltage distribution networks are mostly "blind" and only have
information on how power is consumed on a small scale from sample surveys.
"The distribution network is lagging behind at the moment and it's a big
challenge," says Amy Cooke, business development director from global
telecoms company Cable&Wireless Worldwide, which has a £207 million
contract to provide and run a dedicated network for U.K. power grid operator
National Grid.
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"There are in excess of 500,000 mid-voltage substations in the
U.K.
that will need some kind of communications applied to them through the smart
grid rollout," Ms. Cooke says.
Italy
has made the most progress in this area in
Europe
and has already
upgraded and automated around a third of the substations in its distribution
network, allowing smart meters to communicate with the grids.
Aside from technological challenges and the huge investments required in smart
grids, one of the main obstacles has been consumers fears of the 'Big Brother'
network operator reaching into their houses and turning off fridges and washing
machines in mid-cycle at times of peak demand.
Data privacy
People
are also concerned about data privacy and security. They don't like the idea of
utilities companies having such detailed information about energy usage. Some
pilots have even been halted by regulators due to the lack of clear consumer
benefits.
A joint report from Accenture and the World Economic Forum warned that smart
grids are unlikely to be fully realized unless utilities improve their
engagement with the consumer.
"If utilities want to improve the success rate of smart grid pilots, they
will need to set clearer objectives and improve consumer engagement," says
David Rouls, managing director of Accenture Smart Grid Services.