Prospering from the Energy Revolution can be greater than the sum of its parts

Published: 16 April 2020

Written by Eva Gromadzki, ERIS Director, this is the first blog post in a series to be published by the Energy Revolution Integration Service (ERIS) team.

Twenty-five projects, 11 concept designs, 10 detailed designs, four demonstrators and 100s of partner organisations.

With expertise ranging from software development for electric vehicle smart charging or domestic heating systems, to community engagement specialists – Prospering from the Energy Revolution (PFER) has a wealth of collaborators aiming to trial and test innovative approaches to developing Smart Local Energy Systems.

PFER is a £102m programme funded by the Industrial Strategy Clean Growth Fund and directed by UK Research & Innovation. Projects are aiming to prove investible business models, with success evaluated on whether they can:

  • Leverage 10 times’ the investment
  • Reduce greenhouse gas emissions to meet the 5th carbon budget
  • Reduce end-consumer bills by up to 25%
  • Create world-class consumer experiences
  • Demonstrate national and international scale-up and replication.

Integration and Interoperability

The role of the Energy Revolution Integration Service (ERIS) is to help PFER projects take a ‘whole systems’ approach to creating new markets.  Very simply, this means broadening the view of technology as the solution and considering technology as part of a solution.

So Smart Local Energy Systems of course consider technologies across electricity, heat and transport, but they also take account of the:

  • People and organisations involved, including the customers for whom products and services are designed;
  • Information and infrastructures required to provide products and services;
  • Enabling commercial and regulatory arrangements;
  • Rules and procedures that allow smooth operations; and
  • Principles and standards that govern the relationships between all these elements and enable them to operate together – the system interoperability.

This integration work helps projects with the quality and investability of their business models, by identifying integration risks and opportunities and addressing them.

An example of how are we helping

One of the major concerns of many consortia are the current policy and regulatory conditions in the UK. For example, the “smart” innovation of many projects depends on accessing half-hourly data on consumer energy demand, rather than a monthly block of data, to develop services that reward customers for shifting their energy use to off-peak times when capacity on the grid is greater.

Smart Innovations

Projects are trialling services for electric vehicles to shift demand for electricity to periods when energy demand is lower using smart charging – aiming to in turn lower consumers’ bills and reducing strain on local power network. However, to achieve these benefits, market mechanisms are required that encourage EV owners to participate, and provide energy services to the wider system, ensuring this value can be realised. It is vital that these services are designed with the consumer needs at the centre, so they are incentivised to take part. This is a key defining principle of the Electric Vehicle Energy Taskforce, from which we are bringing extensive insight into these types of challenges.

Business Models

How these smart services generate revenue in the future depends on their business models, and these may be impacted by a number of Ofgem and BEIS reviews and consultations currently taking place. These include changing how electricity prices are calculated, and licensing for different generation and storage assets – such as the forward looking and access charges to the electricity market, flexibility action plan, and RIIO 2 to name a few.

Policy and Regulation Working Group

So in partnership with EnergyREV – PFERs academic consortium – ERIS has set up a Policy and Regulation Working Group to act as a forum for collating the risks and opportunities across projects.

We will monitor the consultation landscape, gather a strong evidence base from across PFER projects and utilise insights to support and empower policy makers with the knowledge they need to make decisions that will accelerate the development of Smart Local Energy Systems.

Other service examples

ERIS is offering a range of services to projects, including:

Aspects of Integration

With consortia ranging in size from three to 15 member organisations and many are coming together for the first time, ‘Aspects of Integration’ is an approach we’ve developed to help consortiums explore and align (individually and collectively). By utilising tried and tested ‘systems engineering’ and ‘systems integration’ tools and techniques, we can help address gaps and conflicts early, and provide a foundation of high-level system requirements, e.g. local prosperity, air quality, etc, upon which further design work is based. For example, utilising visual system design models that show key elements of the system, their relationships and attributes, etc…

Home Truths

Our Home Truth’s consumer panel is being used by projects to test, at high level, whether consumers would consider electric vehicle smart charging.  We found that customers weren’t comfortable with the idea of a third party controlling their property, but that they might give up some control in exchange for service guarantees.  This is an important insight, because it impacts the commercial arrangements between network operators, vehicle manufacturers, energy suppliers and customers, and in turn will influence and be influenced by physical and operational systems.  For example, if a customer’s vehicle fails to charge when it is supposed to, how are the physical, commercial and regulatory aspects of the system designed to ensure that the customer is protected and the organisation responsible is held accountable?

Collaboration

We have a suite of digital collaboration tools that enable projects to upload, store, share, search and discover data (in various forms) through LEAdM, our data portal.  Participants can search the wider energy web through our Energy Knowledge Exchange (EKX) tool, and they can find other projects with similar or complementary interests through our PFERhub website.