Managing the grid balancing imperative in the energy transition

Simon Courie, partner at UK law firm TLT, explores the new options available to helpmanage a grid that includes more renewables

When the leaders of Canada, France, Germany, Italy, Japan, the UK and the US gathered for the G7 summit in Cornwall, they knew that expectations were high and that the eyes of the world would be upon them. Not only did these leaders need to work together to bring an end to Covid-19 by mobilising support for an unprecedented international vaccination effort but they also had to revive the vast swathes of the global economy that had hampered by the pandemic. They additionally, of course, had to tackle the other emergency hanging over the world – catastrophic climate change.

In the communiqué that resulted from the summit, leaders pledged to limit the rise in global temperatures to 1.5 degrees Celsius, in line with the COP21 Paris Agreement, and reiterated their commitment to reach net-zero carbon emissions by 2050.

The race to decarbonise our economies has been ongoing for decades but it is in recent years that we have seen the most progress, with the transition of the energy system from fossil fuels to clean energy gathering pace. The prospect of a decarbonised, non-polluting clean energy system providing new business opportunities and jobs is certainly an enticing one however it does bring extra challenges in terms of grid balancing – ensuring the right balance between energy supply and demand to avoid blackouts on the one hand and overly high voltage levels on the other.

The challenges of grid balancing

One of the challenges brought about by renewables is their natural intermittence – the fact that the sun doesn’t always shine (and simply doesn’t shine at night) and that the wind doesn’t always blow. The issue of intermittence used to be a question mark over sources of clean energy but with the rapid scaling of energy storage solutions, we are learning to manage the issue.

The other main problem is the loss of inertia in the grid. Clean energy sources generate power to the grid electronically rather than directly as power stations with vast turbines running on coal or gas do. These heavy turbines rotate at the same frequency as the electricity grid and carry with them significant momentum, such that if there is a dip or rise in energy production the natural inertia of the machinery rotating at near-constant speed will largely stabilise the increase or decrease, keeping grid frequency steady. The energy system of tomorrow, therefore, will need to compensate for the loss of inertia built into the system. Thankfully new technologies are bringing inertia back.

The power of storage

Energy storage provides the best way to handle potential intermittence issues and the UK’s battery storage capacity is accelerating rapidly as a consequence. Indeed, more and more developers are fitting solar and wind sites with large-scale storage facilities, not only because batteries provide the solution to intermittence but because they improve the viability of schemes. Energy storage not only has the obvious advantage of providing readily accessible power in times of need when clean sources are generating insufficient supply, they also allow for greater cost-efficiency by controlling when electricity is stored or released. This means, for example, that energy generated during off-peak periods can be stored and sold at a higher price during times of high demand – enhancing profitability.

The current battery technology deployed in energy storage projects works very well but, just as encouraging, is the continued development of new technologies that will make grid balancing efforts easier going forward. As R&D investment continues to be ploughed into exciting technologies such as flow batteries, molten salt batteries, liquid air and hydrogen storage, new solutions will be commercialised and, benefitting from economies of scale, become viable for widespread use.

When one considers the prospects of these new products, in addition to the fact that existing battery and clean energy technologies are set to continue becoming even more cost-effective, the future clean energy landscape looks extremely bright and appealing for investors.

While energy storage solutions tackle the significant majority of grid balancing concerns, they do not address the lack of inertia in the system. Luckily, new technological solutions – consisting of large spinning machinery made up of a generator and flywheel – have been produced to tackle this issue and National Grid ESO has three pathfinder projects designed to roll out this technology and solve the inertia problem.

More broadly, National Grid ESO is taking an active approach to balancing an increasingly clean grid, with dynamic containment, dynamic moderation and dynamic regulation. For example, NGESO has implemented an Optional Downward Flexibility Management Service (ODFM) to provide small clean energy generators with additional commercial agreements if they reduce their output at times of oversupply. In essence, this means that in certain circumstances clean energy operators will be paid to stop generating power – once again demonstrating how the challenges of grid balancing are creating new opportunities within the energy system.

Devolving the grid

Another important reality that will make the grid easier to balance through the energy transition is the fact that we’re likely to see a proliferation of devolved micro-grids. There are already plenty of examples of local community micro-grids, with their own clean energy generation and storage facilities to regulate the network, but these are set to become increasingly common. The rise of these localised grids could, in time, mean that fairly significant portions of the UK end up largely autonomous from an energy perspective, reducing the pressure on the national grid.

This reasoning also applies to private wire or corporate power purchase agreements (PPAs) where clean energy operators sell directly to a private party, for example to an industrial site or business park. Once again, the result is that of power-hungry sites being taken off (or at least made significantly less reliant) on the national grid – thereby reducing demand.

EVs: the ultimate utility tool

While the majority of electric vehicles (EVs) will depend on the grid for their charging and the electrification of transportation will undoubtedly create a significant additional demand on the grid, EVs and EV charging infrastructure will also offer new solutions. With charging infrastructure set to rise rapidly up and down the country as the uptake of EVs accelerates, ahead of the UK’s 2030 ban on the sale of petrol and diesel cars, a growing proportion of charging sites will feature battery storage. As with other forms of energy storage, the batteries will supply electricity to charging points during red-band periods when demand on the grid is high and will be charged up at off-peak times.

EV to grid (V2G) connectivity also presents an interesting prospect, with an innovative use for vehicles. V2G consists of charged EVs being used to help power homes. Unfortunately, at present, it may result in vehicle warranties being annulled, however if regulatory change goes ahead, it could become a game-changer by turning every household vehicle (which in the future will be electric) into personal storage units. This would enable households to save money by charging their vehicle when electricity is cheapest to plug into the grid and use at times when prices are higher. Changing the rules to allow such a practice would not only encourage EV adoption but also help reduce demand on the national grid at peak times and aid in balancing efforts.

With societies around the world quite literally feeling the heat, the transition towards decarbonised, clean energy systems is accelerating. As we electrify our power (including heat and transportation), clean energy is set to take up an ever-more important role. While this is not without its challenges for grid balancing, the fact is that the technologies that already exist, as well as those that continue to be developed, are managing the issue and offering myriad new opportunities. Challenges are there to be met and opportunities to be seized. What are we waiting for?

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