New Power interview: turning Manchester into a smart energy city

In New Power’s September issue, Janet Wood spoke to Paul Brodrick, head of connected communities at Siemens, about making networks smarter – even in advance of the smart meter rollout

 

“People talk about smart cities, and it’s a hundred different things to a hundred different people, but essentially it’s just infrastructure,” says Paul Brodrick. I meet him at the early stage of an EU-funded project that aims to develop ‘smart’ quarters in three European cities – Manchester, Eindhoven and Stavanger. Brodrick is looking at smart energy, but the project is much wider than that, bringing together ICT, mobility and energy.

The project – dubbed “Triangulum”  – is funded from the EU’s Horizon 2020 programme, from which “we could see there was €80 billion to go after, in various calls to 2020”.

Each project has three cities, and Brodrick says: “The idea is we have a theme that runs across them, so essentially what we are trying to do in each one is create a smart quarter or a smart district.” He says Manchester was chosen from several options. Siemens “likes to work with cities where we have a big presence” and UK cities that meet that brief include Nottingham, Newcastle, Manchester and Hull. But workshops with Manchester’s city council and its two universities, and a clearly defined potential smart area, clinched the choice of the city.

The Manchester part of Triangulum is based on the Oxford Road corridor, from the city centre to the hospital. Brodrick explains the plan: “It has both universities there, health care, council buildings – essentially it’s a microcosm of a city. The idea is to make it a smart district. You can’t make a city smart in one fell swoop, you will have to do it in pockets, whether it is new-builds, regeneration areas or retrofit projects.”

“Essentially what we are trying to do in each [city] is create a smart quarter or a smart district”

He talks more about how the three themes are interrelated – and driven by users: “The idea around the Manchester part is that there is an open data platform, now called the Triangulum-i. Data from the other workstreams feeds into this platform, which is made available to the citizens to create their own apps. If you look at some of the apps we use every day, like Citymapper or Uber, they are very simple but they are based on city data. So that’s the idea of the data platform and the ICT element.
“The mobility element is all about how you electrify transport. That’s not just electric vehicle charging posts but, for example, can you centralise delivery so that you have delivery people come in, deliver it to a central post and get people on electric bikes delivering it around?

“We are responsible for the energy workstream and we want to create a virtual power plant system connecting existing assets.”

The company is focusing on the potential to harness local generation assets because there has been so much work done on the demand side. There are lots of demand datasets already available, Brodrick says, giving as an example the Low Carbon London dataset on time of use tariffs. “But no-one has really done a study on aggregation and connecting multiple microgeneration assets. We are connecting solar and fuel cells; we will put a Siemens SieStorage battery in the university. We are connecting to a CHP plant.” Altogether, the project will have the equivalent of 3.5MW of controllable generation, including one 1.5MW source, in the centre of Manchester.

Brodrick adds: “The point of the exercise is not to see whether we have enough load to supply the people who are there, because clearly we haven’t. It’s more of an R&D exercise around whether we can have multiple assets and connect assets from multiple owners. If, for example, there is a demand response where we use 30 out of 50 assets, how do we pay people for that?”

“No-one has really done a study on aggregation and connecting multiple microgeneration assets”

Siemens is working with the university on research and development. But the exciting aspect, says Brodrick, is opening it up to the public and saying: “Here’s a data platform about your city – do what you like with it. So whether it’s a hackathon, people writing apps – whatever they want.”

How can that be as open as possible while managing risk? “Clearly you can’t provide energy data, so we are looking at governance around that data – how do you anonymise it, how do you secure it, because clearly that’s critical. We are going to model it first before we doing anything real. We will build a model of the energy system, connect it to a trading system, see if it’s technically feasible and how to identify revenue streams.

“The reason why that’s important is that lots of cities are coming to us in all regions and asking how they can unlock new revenue streams. There’s a technical ‘can we do it’ part but there is also a commercial ‘what are the revenue streams’ element.”

Local energy is driving change That interest from cities and local authorities is real and growing. And Brodrick says that’s the logical place to start thinking about infrastructure: “In 1947 50% of local authority revenue came from utilities. Lots of people want to start their own energy companies – the GLA [Greater London Authority] is the most important, because if they can do it anyone can.”

He says: “One of the things we have been asked to look at a lot is local energy systems and microgrids and how you can manage energy – not just electricity – locally. So if you have district heating too that’s really important and that’s why we are going to start looking at the relationship between electricity and heat. Someone has to.
“There is a huge movement here towards decentralised energy and some terrifying statistics about energy that’s already connected to local networks. The city already has lots of energy, whether it’s backup generation in supermarkets or underutilised CHP in a hospital. We are just unable to connect them up because power purchase agreements go with traditional energy companies.”

Part of the Triangulum process will be looking at how that could change.

I ask about the parties taking part in using the 3.5MW in the Manchester corridor – which includes two private wire networks in one of the universities. Who are the buyers and sellers? Brodrick says: “We don’t know yet. It could be the utility, it could be the city, it could be an Esco. Our study will identify the revenue streams. In terms of who owns it, should it be the people? Should it be the universities? There’s an argument: if 50% of the assets are mine, should I get 50% of the revenue? If you have a multi-asset multi-owner portfolio, who gets paid and how?”

That’s a fundamental question for those taking part, but for others it’s something that needs to be managed on their behalf. Brodrick sits on the energy industry working group for local supply and he questions whether the industry’s view that customers want more data on energy is the right one.

He says, “People aren’t interested. One of the things I’ve learned – talking to developers, infrastructure guys, cities – their view of the energy industry is actually it’s just a service. They aren’t interested in whether it is transmission or distribution, they are interested in how much it costs them or their tenants per kW.
“That’s why you are seeing so many emerging players in the market. What unlocks that is ICT. People talk about smart grids but that’s not about electrical engineering any more, it’s about data and data analytics. It’s all about new business models and no-one knows what they are yet.

“It’s huge and it fundamentally affects the existing energy system – regulation, settlement, everything.”

Brodrick does not think that decentralised energy will replace the large scale energy system. It will be complementary, he says: “Developers want to own assets, energy companies want to own assets, people want to own infrastructure. As we are coming out of recession the industry is going to do a hockey stick. Look at all those new developments going up in London – each one of those needs an energy system, whether it’s a CHP, a private wire system, whatever.”

After 15 years in the industry, Brodrick says he is seeing a change in market entrants. “I talk to people now that when I was sitting in Elexon in 2001 I never thought I’d speak to. I never thought I would be speaking to a city council.” But in fact, the wholesale market he worked on while implementing Neta is valid for local markets, he says “just drop it down a level”.

“I talk to people now that when I was sitting in Elexon in 2001 I never thought I’d speak to. I never thought I would be speaking to a city council.”

 

He says it’s possible that a local energy market would be of everyone – prosumers upwards – buying and selling themselves, but that’s so complex he thinks it’s more likely that: “There has to be some sort of service company that provides those services to citizens or cities – whoever it’s driven by.”

He says cities want to “take control of their own destinies again. Manchester has just been given control of its healthcare budget again and if you look at the devolution of power in the context of energy, why wouldn’t you? If I have power sources in my city that are owned by different people and PPAs across different energy companies, why wouldn’t I create a vehicle to PPA the energy across to me and I will supply my own citizens. When it comes to billing, I will put it on the rates. It’s really interesting the way it has come full circle.”
He sees a similar evolution in balancing. “There are more assets and more data. I see the analogy – as someone who spent time in a telecoms company – when we first had mobiles we paid per text and per second and we paid on exactly what you used. Now you have a smartphone you can pay a set fee and get unlimited data, unlimited texts. The telcos optimised that system and they still make money out of it. You can see energy moving towards that model.”

He adds, “There has to be a fiscal settlement system that has to happen and people have to pay for what they use.” But that may not be a single point – it depends, for example, on whether distribution network owners become distribution system operators.

“There is a huge movement here towards decentralised energy and some terrifying statistics about energy that’s already connected to local networks”

All about the data Big picture aside, I ask what the initial steps are for Triangulum? It is at the technical specification and design phase, which will be finished in November. Brodrick returns to the data: “We’ll start connecting stuff up next year and getting data back. There will be meter data but also Scada data, market data, we’ll bring in weather data. It’s very exciting. All of this then becomes a big data challenge. Even now I don’t know where it will go because we don’t have the data back yet. It’s a real chicken and egg situation – can we sell demand response and into what market at what time of day? What flexibility do we have?”

There are some issues to deal with. Cyber security and privacy are fundamental – the project has an explicit workstream on that and a Siemens team is being developed internationally.

“If you are connecting up assets and managing revenue streams your system has to be secure. We provided input to [Department for Business] working groups on smart cities, what is the governance around data and how you can use the datasets and it’s really interesting because no-one really knows.” Transport for London has made the data around its timetables all open source, and that has prompted applications such as Citymapper to pick it up.

The second issue is getting buy-in from local organisations. “The biggest fear from the assets owners is what will you do with my asset?” says Brodrick. Put simply, if you can say to the chief financial officer “I can save you 10%” of your energy costs, why wouldn’t you do it? But in fact he knows it is not that simple, having made the attempt before: “The data centre guys would say ‘don’t touch my building because it’s business critical’. The building guys would say ‘you aren’t touching my HVAC’. So you have a customer acquisition problem there.” You have to demonstrate the benefit and understand the risk, he says. If you are talking to a manufacturer, for example, you have to understand that’s their business, not energy, so the risk/reward balance is different. “The ancillary services market has to appropriately incentivise people to participate.”

One thing that does not have to be in place before the project starts is smart meters. Triangulum is not relying on smart meter data. That’s been done, Brodrick says, and so has work on response.
He suspects smart meters may be a sideshow: “Smart meters provide a platform for energy innovation, but when we get out of our energy silo the world around us is not broken up into half-hourly settlement periods … if you are in the real world you want data immediately. If I have my phone and I want to know what’s happening in my house I want it now. I don’t need to wait for that from a smart meter – notwithstanding the data problems.” After all, even traditional companies such as British Gas and Npower are providing that with Hive or Nest, ahead of the rollout.

“People talk about smart grids but that’s not about electrical engineering any more, it’s about data and data analytics”

Comparing energy with other infrastructure development, he says the focus on smart meters is “a total copout. Data is available with smart city and analytics. Innovation is created by the combination of smart cities and different datasets and no-one really knows what they are yet. If you look at Uber for example, it is GIS, essentially. It’s mapping the city, linked to GIS on the phone, two different datasets, I want a taxi and there you are. How simple is that?”

If the project does not rely on smart meters, it also does not rely on the local distribution network. Electricity North West is “watching with interest” but does not have a role at the moment, says Brodrick. But, “They are keen to help us, because it is a local network, they are part of it and it is still their network.

“Private wire and microgrids are interesting for us and Manchester Metropolitan University has two private wire networks. They are increasing because developers are either waiting for two-year connections or they are going to do it themselves.”

Although Brodrick is reluctant to define a future he expects to be up for grabs for new business models, he is sure it will move towards energy centres and a multi-utility approach. If a site has commercial and housing “why not put an energy centre in?” he says. “Why Manchester is so important is that these are no longer energy, telco and mobility business models. We see it in our own business because everything converges and it does it [around the] location.” His money is on simplicity and predictability for consumers. “The district has people … and they aren’t bothered who supplies their services. If I move in to a development and I have energy, water, comms supplied and a shuttle bus to the station, I’m happy.”

 

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