Energy Systems are changing the way we look at electricity

Distributed energy systems are changing the way we look at electricity

Energy Systems

Energy Systems Renewable energy is entering the electricity grid at an accelerating pace. Most of this is wind power, about six terawatt-hours a year. It now covers about 7 percent of Finland's annual consumption of about 87 terawatt-hours (+ 2%) in 2018, but by 2025 the share of wind power is already estimated at 15 TWh.

Energy Systems The share of solar electricity, on the other hand, is relatively small, less than 0.1% so far, but the situation is changing rapidly. Since 2016, the capacity connected to the photovoltaic grid in Finland has almost doubled every year. If the growth continues at the same rate, in 2030 up to 5 gigawatts of solar electricity may be connected to the Finnish electricity grid, which corresponds to about 4% of the forecast consumption. By comparison, the production of solar electricity in Germany in 2017 accounted for about 7% of total consumption.

Unpredictable production causes unpredictable prices Energy Systems
The share of wind power in our energy production will therefore be relatively important in the coming years. Basic power is generated by nuclear power plants whose production is constant and cannot be adjusted quickly. As electricity consumption and production must always correspond to each other, fluctuations in consumption must be offset by other means,

 such as hydropower or fossil fuel power plants. In recent years, the share of Energy Systems hydropower in electricity production in Finland has varied between 12 and 16 percent, depending on water conditions. However, this and other available control power alone is not enough, which is why part of the control electricity comes from the common Nordic market. This works, at least today, when a significant part of the control electricity in Sweden and Norway is not yet escaping to the better-margin markets in Germany and the United Kingdom.

The problem for growing wind power in the energy market is the poor Energy Systems predictability and variability of energy production according to wind conditions. When there is a lot of wind, the price of electricity goes down; if there is little wind, the price goes up. When electricity companies traditionally enter into long-term fixed-price customer contracts, 

they have to rely on production and consumption estimates, which creates risk for the seller. The end customer, on the other hand, receives his electricity at the agreed price, so the price risk is borne by the electricity company when trying to stay on the forecast balance. Energy Systems

In the future, more and more people will see a shift to spot prices, ie the end customer will pay an hourly price for their electricity. In this way, price risk is redistributed, and at least the accuracy of the day can also be used to predict price developments. This is especially the case when the consumption of a property can be intelligently directed towards low-cost hours and reduced during expensive hours. However, if production and consumption cannot be controlled in any way, price fluctuations between hours and days can be really drastic.

How to fill the self-sufficiency deficit?

In 2018, the self-sufficiency rate of Finnish electricity was only about 77 percent, and about 20 TWh of electricity was imported, most of which came from Sweden. The pan-Nordic electricity market is one option for finding a balance, but imported electricity can be expensive, especially if your own balance is exceeded. The available capacity in the electricity market may also become a problem as the Nordic market begins to sell control power to other parts of Europe. It is therefore also necessary to consider new ways of reconciling production and consumption.

Electricity companies are responsible for their electricity balances, so they have to take care of filling any “gaps” themselves. The joint project of Lumme Energia, Etelä-Savon Energia, and Tieto is currently piloting a new, modern and intelligent way to make the most of the available resources, based on consumption flexibility. Energy Systems

Intelligently managed virtual network control capacity

When a sufficient number of electricity consumers are combined into one dynamically controlled mass and by controlling resources, ie consumption, can be regulated, a so-called wear elasticity that can be used to compensate for lack of control force.

There are about 1.2 million detached house properties and tens of thousands of commercial and industrial properties in Finland. If all of these are virtualized, the end result is a huge opportunity to regulate consumption intelligently.

 

For example, the consumer may see the adjustment as using a water heater or underfloor heating at a lower hourly rate, even a few hours later or earlier than usual. In commercial and industrial properties, heating, ventilation, lighting, or even some of the processes in industry can be regulated accordingly.

As vehicles increase in the future, they will bring a significant increase in available capacity. Because they are stuck at the charging point most of the time, their batteries can be used as a virtual power plant. The charge is only aggregated a little per vehicle and the amount does not affect the vehicle warranties or operating distance. Similarly,

 real estate batteries can be utilized as long as battery prices fall to a level where they are beginning to become more common. In addition, they also act as a necessary buffer for generating charging energy for electric cars without significant increases in the connection capacity of properties. In a sufficiently large network, the consumer of electricity does not even notice the adjustment, but the electricity company can utilize volume resources and their flexibility to balance consumption in the electricity market. Energy Systems

In the first phase, the control capacity generated by intelligent control can be sold in Fingrid's reserve market using automatic algorithms. In the future, artificial intelligence and machine learning may also emerge, enabling automation and market operation to be further automated and optimized into an asset and entity that continues to make greater use of the electricity market.

The user of electricity also benefits
As electricity supply from elsewhere declines, it will have a significant impact on the national economy and the electricity and trade balance.

Consumers have the opportunity to use more and more renewable energy sources. Interest in organically produced electricity is high, but one of the most important factors for households is understandably price. When a customer joins the flexibility market through Lumme Energia's system, he does not even notice the flexibility, but benefits from the compensation paid for the flexibility.

Other value-added services may also be available, which have the effect of enabling the consumer to obtain from one place services that have previously required contact between several parties.

An open digital resource for electricity

The future opens up interesting prospects for how attitudes towards energy will change. Artificial intelligence, blockchains, and digital currency can enable electricity to become an open and automatic commodity for different markets.

With the help of the blockchain, the owner of a solar panel or wind generator can possibly even sell electricity to his neighbors without intermediaries or charge his electric car at work from his home stock. At the national level, consumer elasticity promotes self-sufficiency in electricity and benefits electricity companies, which can operate in the electricity market with more resources and services. In 2019, Lumme Energia will commercialize and introduce new services based on digitalization.

Read here how Tieto's, Lumme Energia's, and Etelä-Savon Energia's energy solution reduces emissions and energy bills - the first in Finland.