by Graham Ault, Executive Vice President, Markets & Products at Smarter Grid Solutions
It feels odd to describe the Cop26 climate summit in my home city of Glasgow as a highlight of 2021. Its outcomes were mixed but it was undoubtedly one of the biggest moments for many of us in the power sector.
Thinking about how the events of the past year will influence the coming year, I noticed that the US-China Joint Glasgow Declaration specifically mentioned “distributed generation policies that encourage integration of solar, storage, and other clean power solutions closer to electricity users.” This could well be the first time that distributed energy resources (DERs) have had such prominence in multilateral climate action and gives a nod to the need for the associated DER management systems, DERMS, in order to optimize carbon reduction with grid and market interactions, and customer benefit.
Added to that, the Green Grids Initiative announced during Cop26 mentioned, ”zero emission vehicles and grid flexibility … solar mini-grids and off-grid systems.”
With this spotlight on many of the detailed issues beneath the climate emergency, there’s a huge opportunity for the power sector to capitalize on this greater awareness and appetite for solutions. Here’s what we saw in 2021 and what to look out for in 2022:
1. The demand for grid resiliency and microgrids
This challenge certainly came to the fore during 2021 and will continue to be an issue in the year ahead. Extreme weather events in locations such as Texas and Louisiana prompted people to question whether the status quo on grid and market arrangements will prevent major grid outages from occurring again. As businesses and consumers demand a more resilient and reliable grid, utilities will need to focus on microgrids and other grid management solutions. And we’ve seen clean DER assets quickly become the technologies of choice in microgrids.
2. The role of renewables in energy markets
We’ve seen increasing renewable investments due to falling technology costs, continued government support through tax incentives, and further implementation of state renewable portfolio standard (RPS) goals. This meant that during 2021 the majority of new generation capacity in the US was sourced from renewables. This continues to have a profound effect on wholesale energy markets and system operations that is likely to be amplified further as renewables continue to grow and market changes are implemented.
3. Significant investment in DER technology
2021 saw large scale investment in distributed energy resource technologies, with big additions to regional, national and international solar PV, storage and EV infrastructure. Heat and building electrification also gained some momentum. Each of these signal the need to manage our grids with both the impacts and the potential of DER to the fore. It all points to momentum behind a larger scale roll-out of DERMS.
DERMS is an educational track at DISTRIBUTECH, set to hit Dallas, Texas from January 26-28, 2022. See the sessions that will be offered in the track here and register to attend!
4. Policy influences on the energy sector
In the US we’ve seen the Infrastructure and Build Back Better bills gradually making their way through the legislatures but further changes are still likely. As they stand these provide financial incentives for the development of DER and microgrids.
On top of those bills, there is FERC Order No. 2222 which aims to promote competition in US electricity markets by removing the barriers preventing DERs from competing on a level playing field. 2022 will be a pivotal year for these developments. The fruits of the activities of regulators, utilities, DER developers and others will be seen in greater market access, participation and new business models that add value to customers, grids and markets from managed DER.
5. Further value from grid data
The industry is increasingly looking for advanced solutions to optimize energy assets to enable a variety of DER participation models to create economic value and reduce carbon. Much of that value is built on data analytics which comprise a diverse but interlocking set of methods that can provide attractive benefits. However, the advanced numerical methods upon which they are built can provide challenges. Smarter Grid Solutions has been using our extensive field experiences in this space to safely and effectively operationalize analytics for DER operations in the grid.
6. Managing the carbon in in towns and cities
It will become increasingly important to monitor the carbon intensity of the electricity flowing through grids to meet customer and local targets throughout the year. For example, grid carbon data can enable daily management of EV charging and heat demand to minimise the use of electricity when carbon intensity is high. For example, high grid carbon intensity tends to be aligned with high grid demand so a town or city council with a fleet of new electric waste collection vehicles will need to schedule vehicle charging to lower grid carbon periods.
7. Greenwashing’s days are numbered
One final thought on what lies ahead relates to where I started, with Cop26. The Glasgow summit does seem to have spurred on a range of corporate initiatives with companies big and small stepping up their efforts to demonstrate their net zero credentials. Everyone is alert to the risk of greenwashing. We all know that it’s not enough to be able to talk a good game – you need to be able to prove it. It’s an area of scrutiny where I think we will see a lot more activity and so each of the areas above will have significant momentum behind them.
Conclusion
In short, 2022 promises to be a year when issues such as grid carbon dynamics, grid resilience, the next step forward in renewables and the targeted exploitation of data will surge up the agendas of businesses, politicians and wider society. It means further opportunity for the power sector to help drive positive change. Let’s be ready to do so.
About the Author
Graham Ault is Executive Director and Co-Founder at Smarter Grid Solutions (SGS). Native to Glasgow, Graham has over 25 years’ experience in the energy sector and is highly respected as an expert on the transition to a low carbon energy system.
He co-founded SGS whilst Professor of Power Systems at the University of Strathclyde in Glasgow, and over the last 13 years has been instrumental to its vast international growth, spearheading entry into new markets spanning four continents and managing a growing team across four time zones.
Graham has led many ground-breaking initiatives in smart, clean energy including assignments for UK, US and international utility companies, energy majors, governments, national labs, research agencies, working groups and the investment community.
