Why batteries are the key component in the new energy mix
You may think of the humble battery simply as a storage device. But as we enter a new era for energy, it will have a critical role to play. With a new and increasingly distributed energy mix that brings with it new challenges and new opportunities, without batteries utilities would struggle to ensure a more flexible, cost-efficient and sustainable electricity supply.
Before we look at how critical batteries are to the energy market of the future, let me begin by looking at some of the new issues utilities are facing today.
New challenges and trends ahead
Firstly, we’re entering a world where renewables and local energy production are becoming a growing part of the energy mix. With that, utilities need to understand how best to integrate their intermittent production from wind farms and solar farms into their production and consumption forecasts. They’ll also need to consider e-vehicles with their rapidly rising energy consumption and storage capacity.
With all this change happening, utilities understandably have some major concerns. From energy supply resilience, through grid stability to the quality of energy produced and supplied, these are all major challenges. Then moreover, the European regulation for a rapid acceleration of decarbonization.
Data is going to be essential to addressing these concerns: collecting data, aggregating data, analyzing data and deciding how to act on the outcomes. And with so many new producers and new consumer connecting to the grid, those data volumes are growing exponentially. Managing these, specifically managing them centrally in the cloud, is a challenge in itself; it requires more and more compute along with more and more data to be stored in the cloud, which could lead to issues with network bandwidth. Managing data locally would be a better option.
We’re also seeing several trends and solutions emerging:
- The first is collective auto consumption, where we are seeing local collectives collaborate on localized electricity generation, storage and consumption for increased local control and lower reliance on central energy production.
- The second is edge computing, which is putting data and compute capabilities very close to the individual asset to reduce network bandwidth requirements and latency, so demand can be forecast effectively for a more efficient response.
- The third, and the topic we’re focusing on here, is battery integration. These distributed energy storage mechanisms will increase flexibility to ensure we use energy in a more sustainable way.
The journey ahead
Considering the challenges and trends we’ve discussed above, we can expect the journey to the new world to come in three steps.
1. The first step sees the emergence of the microgrid. Edge computing, together with local production and consumption forecasts, will help utilities manage the balance between power consumption and production locally. Adding batteries to local renewable power production is a must to support balancing the intermittence of local production and the load the grid.
The main stakeholders here are the TSO and DSO. Connecting batteries to the microgrid will optimize grid usage and reduce the impact of peak demand. With grid congestion reduced, they will no longer need to add new power lines to cope with the increase in power flow coming from renewable production.
2. The second step sees the emergence of prosumer collectives, where communities manage and consume local production from renewables within a local part of the grid. As the local power supply becomes more concentrated within these local areas, it opens the market to collective auto consumption.
Small producers and consumers are the main stakeholders. Prosumer collectives lower the purchase price of electricity while increasing the revenue for local producers, which accelerates their return on investment. Although not directly involved, DSOs also benefit from these prosumer collectives, thanks to their impact on the grid stability mentioned earlier.
3. The third step will see e-vehicles connected to the grid. While you might initially think of them entirely as consumers, their batteries can provide storage for the local electricity network. Enlarging storage capacity will improve the grid’s load balancing capabilities, with Digital Twins supporting grid modelization and load forecasting.
The e-vehicle owner becomes the stakeholder at this step, gaining an opportunity to contribute to the stability of the grid and potentially also seeing some financial incentives. But we shouldn’t forget the previous stakeholders. These batteries will only increase the potential of steps one and two.
Our latest Journey 2022 ‘Resolving Digital Dilemmas’ report discusses how emerging technologies are key to delivering on the promise of sustainable power generation. Researched and written by the Atos Scientific Community, read Journey 2022 ‘Resolving Digital Dilemmas,’ for guidance on developing strategies to resolve this and other E&U emerging Digital Dilemmas.