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The cost of integrating renewable energy into the grid

December 7, 2020
CTUK_Member_BE3

Britain’s COVID-19 lockdown this year made its electricity grid ‘cleaner and cheaper’ to run but ‘harder to control’ – a key challenge of moving from fossil fuels to renewable energy.

While grid balancing costs comprised an average five per cent of wholesale power prices during the past decade, researchers estimate load balancing cost about 20 per cent of power prices during the lockdown – a high overhead for integrating renewable energy into the grid.
The good news is that a proven solution is available to manage this demanding and dynamic balancing of energy loads as Britain’s electricity grid moves from fossil fuels to renewable energy, in line with the UK Government’s recently announced plans for a “green industrial revolution”.
carbonTRACK’s intelligent energy management solutions facilitate embedded networks, Virtual Power Plants and smart grids, enabling a resilient, responsive and adaptive future for the energy grid.

The challenge: Seamlessly integrating renewable energy into the national grid

During March, Britain’s national lockdown to combat the spread of COVID-19 led to a much greener and cheaper electricity system in the months that followed. With businesses shut due to the lockdown, energy supply-demand reached an all-time low.
As businesses, offices, factories, and ‘non-essential’ organisations shut up shop across the country, renewable electricity contributed its highest ever share of the energy mix, leading to record low CO2 emissions from the grid.
This reduced the need for fossil fuel power such as coal and gas and also led to curbed demand for nuclear

power, as cheaper forms of renewable generation such as wind and solar carried much of the load for Britain’s electricity requirements. At one point, renewable energy sources delivered almost 70 per cent of Britain’s electricity.
This drop in demand along with a concurrent increase in renewable energy generation delivered practical experience of the complexity and challenges of managing the national grid as it makes its planned transition towards net-zero emissions by 2050.

The opportunity: Reducing the high cost of integrating renewable energy into the grid

Drawing on this experience, Imperial College London and energy firm Drax published a report that identifies the challenges of managing high levels of intermittent renewable energy sources in our national grid – a process that can cost grid operators about £100m a month in order to incentivise generators to take power plants offline to help stabilise the system.
While grid balancing costs have typically made up around five per cent of wholesale power prices on average during the past decade, this new analysis estimates that balancing costs rose to around 20 per cent of power prices during the lock

down period. Grid management firm National Grid ESO moved quickly to ensure appropriate supply and demand at all times in order to keep the lights on. While blackout fears proved unfounded, UK Government gas and electricity markets regulator Ofgem revealed that the costs of managing the grid skyrocketed to a record high of £718m during the five months after lockdown measures kicked in. This has prompted the regulator to announce a review of National Grid ESO’s actions during the period.

The solution: carbonTRACK delivers innovative and proven energy management systems

The challenge is to implement proven and affordable options that can balance supply and demand of renewable energy assets with declining contributions by legacy fossil fuels. carbonTRACK’s end-to-end energy management solution is already solving these problems elsewhere in the world, in locations that include Australia, New Zealand and the USA.
carbonTRACK achieves this with its innovative cutting-edge technology including demand response, frequency regulation and Virtual Power Plants. carbonTRACK’s patented technology provides behind-the-meter solutions and integrated collaboration with energy networks, grid operators and system

networks, ensuring the problems that Britain’s energy industry faced during lockdown are a thing of the past.

carbonTRACK can resolve the problem of grid constraints caused by an ageing and quite often under- or over-capacity network infrastructure by aligning renewable energy assets within Virtual Power Plants and by using

carbonTRACK’s industry-leading frequency regulation and demand-response capabilities.

 

carbonTRACK is already deploying these solutions in the UK after recently winning an Innovate UK

 grant to develop an industry-leading end-to-end energy trading solution for London’s South Bank area.

carbonTRACK is a member of the consortium-led BankEnergi III group which aims to create a local energy economy in South Bank by deploying an end-to-end solution that enables energy to be traded from building to grid supply point. Utilising carbonTRACK’s software, this peer-to-peer energy network will allow members to trade energy with each other, creating a local energy economy and giving them options beyond the traditional grid model of electricity supply.

carbonTRACK UK will leverage its global expertise to deliver a behind-the-meter solution with demand response and Virtual Power Plant capabilities at London South Bank University. The site will connect into the wider energy ecosystem through a ground-breaking open energy data integration layer linked into carbonTRACK’s VPP solution for interfaces with various route-to-market providers.

What next? carbonTRACK enables a resilient, responsive and adaptive energy grid

The lived experience of energy management during the COVID-19 lockdown provided Britain with a test run of how the grid can operate reliably with significant and increasing contributions from renewable energy generation. As well as delivering major emission savings and contributing towards the goal of becoming carbon-neutral by 2050, it also revealed how the high price of grid balancing costs and the other operating challenges of integrating diverse energy generators will present ever more pressing problems for Britain’s national energy grid as it continues to decarbonise.
Based on its industry-leading technology and international experience and expertise, carbonTRACK has the solution to these problems that were identified in Britain during lockdown, enabling the nation to design and deliver a resilient, responsive and adaptive energy grid.

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