Global Insights: 1st May 2018

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Global Insights: 1st May 2018


Energy customers could leave the grid if there is limited action on affordability concerns

Network charging is causing affordability concerns for some customers in the National Energy Market.  The prohibitive cost of grid connection for new homes and the rising cost of the network standing charge on basic customer bills means that off-grid self-generation and storage is now more affordable, and in some areas more reliable, than a grid connection.  If customers leave the grid this means that the remaining grid connected customers face paying even higher network charges.

In order to reduce the current network charges Energy Consumers Australia (ECA)  have called on government to apply a affordability constraint as part of the National Energy Guarantee (NEG).  The ECA have suggested that using an affordability constraint will reduce the risk of network overinvestment on unneeded infrastructure.

Smart Energy Council suggest National Energy Guarantee emissions target needs to be raised to 50%

The Smart Energy Council have suggested that the NEG emissions target be raised from a 26%  reduction to 50%.  The Smart Energy Council hosted a webinar this week featuring John Grimes and Oliver Yates of the Smart Energy Council, Bruce Mountain from Carbon and Energy markets and Tony Douglas from Essential Media.  The commentators recommended that the target could already be reached by 2020 stalling investment in new large-scale renewables between 2020-30.  Concern was also raised at the lack of a trading mechanism and the danger that this would increase prices to customers.


NY Utility Energy Register

Combined with other available system platform tools, like distribution forecasts, identification of system constraints and hosting capacity, officials say the UER will assist third party developers in their market research.  The UER is intended to help with the implementation of distribution system implementation plans, and to understand the value of DER within the NY energy system.

Performance Based Regulation in the US – report by Michigan PSC

This report is by the Michigan Public Service Commission (PSC or Commission), on performance-based regulation (PBR) and its potential applicability in Michigan, was developed to comply with Section 6u of Public Act 341 of 2016 (PA 341). That statute implemented a comprehensive reform of energy policies in the state and directed the Commission to perform a study of PBR in other states and countries, including RIIO in the UK (and as usual has a pretty poor understanding of it). The Commission was directed to engage stakeholders on this topic and evaluate four specific factors: (1) methods for estimating revenue needed, (2) methods to increase the time between rate cases, (3) options for establishing incentives and penalties, and (4) profit-sharing provisions that can spread efficiency gains among consumers and utility stockholders and can reduce the degree of downside risk associated with innovation.

Washington DC DER Agency

Washington DC Bill to create a Distributed Energy Resource Authority (DERA). It has the power to do 2 key things:  First, it would collect and manage granular customer energy usage data from Pepco, the utility that provides electricity for the district. This is aimed primarily at giving customers access to their own data, but is also meant to support third-party access and use, with an eye toward optimizing investment in solar, energy efficiency, demand response, energy storage, on-site generation, or other grid edge assets. Second, whenever Pepco proposes any grid investment of $25 million or more, the DER Authority would open the project to competitive bids from non-wires alternatives — including bids from the utility itself. The goal is to find combinations of DERs that can alleviate whatever problems the utility’s grid investment was meant to solve. This is largely in line with what lawmakers and regulators are trying to accomplish under New York’s Reforming the Energy Vision (REV) initiative. They’re also key to California’s efforts in data sharing, security and privacy, and integrating DERs into utility grid investments.

Other news

Hawaii – more steps towards new regulatory mechanism; not necessarily plain sailing for storage in Oregon


Energy firms call on EU and UK to maintain climate action after Brexit

21 energy giants and pan-European investors have written to the UK and European Commission Brexit negotiators, calling for the UK and the EU to continue to work together to meet the commitments in the Paris Agreement, and to maintain the integration of energy markets and climate policies achieved across the EU to date.  Signatories to the letter include energy companies and investors active across European markets, including RWE, EDF, E.On, Ariva, Innogy, as well as the Institutional Investors Group on Climate Change.

Solar+battery package offers prospect of self-sufficiency in southern France

French utility ENGIE and German battery storage and trading company Sonnen are offering a package called ‘My Power’ for home owners which consists of solar PV together with batteries with a capacity of between 2.5 and 15kWh. The claim is that this combination will offer up to 96% independence from gird electricity in locations with a good solar resources, such as Nice in southern France. The package includes financing and installation.

Germany says 20 percent of EU budget should go to climate action

The German government says the EU should devote at least 20 percent of its budget to climate-friendly projects and programmes, Rheinische Post reports. However the Green Party highlights that the German government spent a little over 1 per cent of its own budget on climate action in 2017.

Solar beats onshore wind in Germany’s first joint auction

The Federal Network Agency (BNetzA) has announced that only solar bids have been successful in Germany’s first joint solar and onshore wind auction for renewables. The average price for all successful bidders was 4.67 eurocents per kilowatt hour, higher than that of the last purely solar auction of 4.33 ct/kWh. In March, the solar and wind industries both opposed joint auctions arguing that the technologies have different cost structures. BNetzA president Jochen Homann highlighted that competitive auctions simply ensure that the technology which offers the lowest cost wins but suggested that ‘for the success of the energy transition, a mix of the different technologies is necessary’.


Blockchain and the energy transitions in cities

The Energy Cities organisation has published a useful report on the role of blockchain in the energy sector.  The report lists, with examples of current practise, areas where blockchain can  be used within the energy sector, this includes:

  • Transaction processing: Examples – Sunchain, Brooklyn microgrid
  • Documenting asset ownership and management: Examples – Gruenstromjeton, Sunchain
  • Energy certification and verification: Examples – Pylon Network Project, I-NUK
  • Real-time monitoring and analysis of energy use: Examples – DAISEE, Pylon Network Project
  • Invoicing and Allocation Processes: Examples – Gruenstromjeton, Power – ID
  • Remuneration in a real or virtual currency: Examples – Solarcoin, NRGCoin
  • Creation of an on-line marketplace for local/regional energy: Examples – Tal.Markt, Power-ID
  • Peer-to-peer renewable energy transactions in a decentralised system: Example NRGCoin, Brooklyn microgrid
  • Offseeting CO2 emissions and rewarding the implementation of sustainatable measurs: Example – I-NUK
  • Facilitating the development of E-mobility as a service: Example – Sunchain

The report touches upon the legal frameworks for blockchain and notes that “setting up a legal and political framework favourable to the mass use of blockchain technology in the energy sector would require introducing many changes to existing legislation.” And that “it is unlikely that the existing energy infrastructure in Europe and at national level would currently be able to absorb a massive flow of blockchain projects”.   The report concludes that it is vital for the city leaders to gain a better understanding of the impact that blockchain might have on their energy sectors and to begin preparing the key demands so that the technology can help radically change the current system.

Snapshot of Global PV Markets 2018

The International Energy Agency’s report on PV markets gives clear information on the state of the global PV sector at the end of 2017.  This highlights the record deployment of PV in 2017, with 98GW of new capacity in 2017, of which 53 GW were in China.   In total 402.5 GW are now installed globally – 70 times more than in 2006.   The IEA also calculates the electricity production from solar and conclude that Honduras now has the highest share in its national power mix with 13.25%.   This is followed by Germany – 7.47%, Greece – 7.34%, Italy, 7.11% and Japan – 5.93%.   China now gets 3% of its power from solar and the global average is over 2% – with a total production of close to 500 TWh.   While the report does not undertake detailed analysis of solar costs it does conclude that, “the super-competitive tenders seen in many countries around the world are sending a clear signal to policymakers that the most competitive PV installations can now compete with most fossil and nuclear sources of energy”.

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