The energy grid is evolving and so is the relationship between energy sources and users. With a little investment, your existing power infrastructure could help create additional revenue.
As governments, regulators and consumers continue to push for lower carbon emissions and electricity costs, the whole power generation industry is undergoing change.
Vast windfarms, both on and offshore, are providing some of that low-carbon energy but it is intermittent. Every time a high or low-pressure system comes across the area where the turbines are sited, the speed of the wind goes up or down and the electrical power output rises or falls. The same applies to other renewable energy sources, like solar farms when clouds cover the solar panels or the time of sunrise and sunset changes.
These power systems are connected via an electrical energy grid network and the parameter which ties the whole grid together is frequency: the measurement by which the whole system is judged. Too much power the frequency goes up, too little and the frequency falls. Across Europe, energy regulators provide strict limits to which the frequency must be kept within.
The effect of renewable energy sources
Grid operators have a forecast of the days weeks and months ahead for the energy that a country requires. In the UK, The National Grid purchases electricity from a set list of generating stations that have tendered for the supply of electricity. It obviously chooses the lowest priced tenders first. So, if the predictions are correct, then everything is ok, supply = demand and everyone is happy. But then, as we discussed earlier, the weather comes into play.
When frequency starts to move in an unexpected way (from the prediction models), then the grid operator needs either less energy consumption (frequency too high) or more electricity is required to be pumped into the system (frequency too low). These services have a variety of names and abbreviations, but basically are chunks of electrical power pumped into the system very quickly, some within one second of a frequency event occurring. Conversely, if large users can switch off demand (maybe transferring to generators or batteries, or in the case of industrial processes, just switching off) for a short period of time, then the grid operator will pay for these responses.
Around the world, anywhere where there is a need to reduce CO2 output from power stations, or where large solar or wind is installed, there is a need for these ‘on demand’ grid support services. These services can generate a lot of additional revenue for the organisations concerned. In the UK the potential revenues from these services are published online and there are a number of organisation that do quite nicely from this income.
Power Systems – A New Revenue Source
So how does this affect your business? Basically, everyone can have a slice of the pie.
The tenders to supply energy services are competed for by a wide variety of organisations. Most of these are so called ‘aggregators’. These companies bring together groups of smaller generators, storage systems or other power consuming equipment, install special equipment on:
- Uninterruptible Power Supplies and battery storage systems
- Large fridges
- Pumps and heating systems on industrial vats and tanks
- Large power consumption items like crushers and mixers in industry
- Gas and diesel generators
When required, the aggregator activates the system which triggers either the generator/UPS/battery to push power (or refrigeration, pump, crusher to turn off power) into the grid. This is a very simplistic description and some complicated engineering is required to safeguard the private producer from the local grid network and vice versa. In return for carrying out these arrangements, doing the invoicing and distribution of funds, the aggregator takes a commission from the amount paid by the grid operator.
UPS Systems and Generators – An Alternative for Grid Integration
For organisations with sufficient technical skills and resources, there are also alternative ways to integrate with the grid. Specialist suppliers, including Vertiv, have developed systems to enable data centre operators, as well as other commercial and industrial organisations to take part in these schemes and generate revenue from existing, or newly acquired, UPS and generator capacity.
Grid integration with the UPS - Risks vs rewards
There might be some concern that using infrastructure such as an uninterruptible power supply or generator for these kinds of grid integration activities might introduce some additional risks for an organisation. That’s a legitimate concern but only a proportion of the capacity is ever used for grid support services – there is always sufficient resiliency capacity to cover any incidents should they occur.
So, with the right strategy, grid support services should enable a lot of innovation in the way users and grid operators interact:
- It could be that fewer new power stations need to be built as the traditional electrical grid inertia provided by power stations can be provided by batteries
- More electricity could be generated from renewable energy sources, like solar power systems, and stored the energy for use overnight (something Vertiv was involved in in 1896!)
- Deserts and wastelands could be converted (in a sustainable way) to solar stations with batteries and high Voltage DC connections over thousands of miles to centres of population (say the Sahara Desert to Italy or Spain)
- Countries supplying all their power from “natural” sources (see https://www.independent.co.uk/news/world/europe/portugal-renewable-energy-generated-electricity-consumption-march-greenhouse-gas-environment-a8289656.html) using batteries at night
- Lower gas, coal and oil consumption worldwide
- Batteries could charge our future electric cars as well as our houses
- The Internet of Things will integrate local supplies and users of electrical power leading to lower electricity prices
Using existing resources like large chilled warehouses, batteries, pumping systems many C&I organisations, not just in the UK, will be able to generate income. This income will vary depending on sthe power consumed, but the potential could be huge for property groups and owners of chains of properties.
At Vertiv, we are focused on enabling these different options for our customers and partners including at recent events such as the Energy Storage World Forum in May in Berlin. The electricity grid is changing and proactive organisations are changing their relationship to the grid.
Learn more on next event focused on Critical Energy: Smart Energy World Summit, in Milan – October 24-25th