Smart grids: The world of energy is changing

by Julia Riemer | Sep 14, 2022 | Interviews, Know-How and inspiration, Market development & Trends, New Mobility, Smart City, Technologies for new markets

With technological progress, the demand for electrical energy is increasing immensely, making not only generation but also distribution a challenge. This growing demand increases the complexity of power grids as requirements for reliability, efficiency, safety, and environmental and energy compatibility increase. These circumstances require an intelligent grid, now known as the “smart grid.” This is a technology in which intelligent functions are implemented to make the power distribution system more efficient, reliable, and sustainable. This article provides an overview of “smart grids” with its features and application scenarios. Read in the following why smart grids are becoming increasingly important and what solutions are already on the market. 

The International Energy Agency (IEA), headquartered in Paris, cites grid integration as one of the four biggest challenges in expanding renewable energy capacity, along with the non-technical challenges of financing, permitting and social acceptance.

By 2026, renewables could grow 60% faster than in the past five years, as the technology to harness wind and solar power has matured and 137 countries have pledged to reduce their fossil fuel power generation to zero. But for the promises to become reality, we need smart grids so that this energy generation and, above all, energy distribution can function properly.

Smart grids perform four important tasks for the energy transition: They increase the resilience of the grid, increase the integration of renewable energies, reduce costs and enable universal access to clean electricity.

What makes smart grids so special?

The constantly increasing demand for energy should no longer be met, or only in exceptional political situations, by building more power plants that use fossil fuels, as these pollute the environment and contribute to global warming. Therefore, renewable energy is preferred instead – but these are distributed, volatile resources that must be managed within a smart grid infrastructure to ensure a steady supply of energy at all times.

Smart grids allow real-time data from line sensors, loads and generators to be collected and transmitted to a central control point that can perform analysis and control functions. This enables power load balancing, outage restoration and distribution management.

Limitations of the traditional network

Unlike renewable energy generators, whose output depends largely on prevailing weather conditions, conventional fossil fuel power plants provide predictably steady energy. However, they come up against the barrier of environmental sustainability and should accordingly be taken off the grid wherever and whenever possible.

In the meantime, demand for electricity is steadily increasing as, for example, we increasingly take our personal and work lives online and use more and more electric vehicles. So without technological advances, we would be faced with a shrinking stock of fossil fuel power plants that would have to serve an incessant increase in demand for electricity.

This strain would have led to an increasing frequency of power anomalies and blackouts on aging grids that have limited ability to detect and respond to faults in real time.

Fortunately, there are now new technologies being deployed to address these issues. These technologies, and in particular the way they work together, can be grouped under the umbrella term “smart grid”.

[infobox headline=”The morst important facts in brief”]

• Power grids are becoming more complex as demands for reliability, efficiency, safety, and environmental and energy sustainability continue to rise
• The technology behind smart grids makes the power distribution system more efficient, reliable and sustainable
• Smart grids enable power load balancing, outage restoration, and optimize distribution management
• With smart grids and renewable energy sources, electricity consumers can move from pure consumption to “prosumerism”
• Smart meters: By 2032, all electricity consumers in Germany must have at least one digital meter without a gateway
• Semiconductors: The use of modern power electronics could save more than a quarter of electrical energy
• Smart grids could also solve the problem of charging stations for electric vehicles in the future
• Once the technology is fully installed, including in the field, the potential for energy costs to drop significantly and for real-time data control and large-scale charging to become easier increases
• Hive Power offers innovative solutions for smart grids

[/infobox]

Smart grid technologies and interactions

Renewable energies have the advantage that they are clean and cost less and less. However, in addition to the aforementioned disadvantage of volatility, there is also the challenge that plants such as wind farms tend to be widely dispersed rather than centralized. 

For this newer grid model, with its multiple distributed energy sources, to function reliably and efficiently, it must be monitored and controlled. It can be thought of as a typical IoT application. Data can be collected in real time from line sensors, loads and generators and relayed to a central control point that can perform analysis and control functions. This enables balancing of power loads, troubleshooting of outages, and management of distribution.

It also facilitates peak shaving, where grid operators can draw on energy supplies from users’ on-site renewable energy systems or even batteries to supplement their own capacity during periods of high demand.

The grid is developing self-healing properties as control systems can detect simple problems and make repairs without intervention. More serious damage to the infrastructure can be reported to technicians in the control center so that timely repairs can be made. To further improve reliability and uptime, the grid can become adaptive, meaning that power is rerouted to bypass problem areas. In this way, the area affected by power outages is limited.

Germany’s progress in renewable energies

In 2020, Germany exceeded all forecasts and achieved 45% renewable energy based on total gross energy consumption. 33% of this came from solar and wind power, the most volatile energy sources. Globally, a 30% share of renewables has been achieved, and grids today, thanks to a combination of robust infrastructure and smart grid technology, are not only cleaner, but also more reliable and resilient. 

Digitization allows us to transform the complexity of the modern grid from a weakness to a strength.

This is necessary for the operation of the modern grid, where distributed energy resources (DERs) are on the rise – from small solar and wind farms to electric vehicles (EVs), homes with solar panels, and commercial microgrids. Literally hundreds of millions of new supply points are added to the grid every year. The number of electric vehicles is also growing exponentially, with 26 million vehicles expected to be sold in the U.S. alone by 2030, up from 5.6 million this year.

Possible savings through smart grids 

Digitization – sensors, artificial intelligence, and automation – harnesses the combined power of all these DERs and shifts electricity demand in buildings and e-vehicles to times when solar and wind power are available. In this way, cities can use more renewable energy and less fossil fuel backup power. This demand flexibility also helps to mitigate peak demand. In the EU alone, the flexibility of smart grids could save billions annually from now until 2030, as infrastructure expansion can be adjusted to the necessary level. 

And the cost savings go even further, extending to ordinary electricity consumers. With smart grids and renewables, electricity consumers can move from pure consumption to “prosumerism,” meaning they can generate and consume electricity themselves and even sell the rest back to the grid.

Imagine 26 million electric car drivers who can charge their vehicles on the grid. At 40 kWh per e-vehicle, they could sell enough clean electricity back to the grid to power 100,000 U.S. homes for an entire year. Prosumerism could make clean electricity affordable for many more people.

The International Renewable Energy Agency also recommends smart grids for developing countries to meet rising renewable electricity demand while creating new opportunities for economic growth.

Universal access to clean electricity is central to a successful energy transition. Specific care must be taken to ensure that people can use safe, smart, sustainable electricity wherever they cook, heat, cool, drive, etc.

All the answers to the question of how we can achieve net zero emissions globally by 2050 may not yet be answered. The potential of green hydrogen and other innovations is still being explored to curb the emissions in aviation, shipping and heavy industry.

But the technology we need to meet the U.N. Environment Program’s goal of halving global emissions by 2030 already exists. In fact, clean electrification of buildings, industry and transport could eliminate three-quarters of global emissions.

Application scenarios for smart grids

While the conventional power grid distributes the electricity generated centrally by large power plants to consumers, smart grids also bring together all the data streams of the energy supply. For example, the highly fluctuating feed-ins from solar and wind power plants can be efficiently balanced and specifically controlled in the existing power grids. The amounts of energy generated and consumed must be continuously measured and analyzed by IoT-enabled sensors and devices.

Smart meters

On the consumer side, this is addressed with smart meters. They also control the feed-in of solar power when consumers with a solar system on the roof also become electricity producers (prosumers). Installation of the necessary smart metering systems (iMSys) is not mandatory until annual electricity consumption exceeds 6,000 kWh – or when consumers feed electricity into the grid themselves. In this case, a smart meter gateway (SMGW) with an integrated security module receives the metering data and processes it for external market participants, internal controllable energy consumers and energy generators (smart household appliances, photovoltaic systems). By 2032, all electricity consumers in Germany must have at least one digital meter without a gateway.

Semiconductors for the energy transition

Measuring, controlling, transforming and communicating – power electronics are of particular importance in the energy transition. While photovoltaic systems or batteries, for example, supply direct current, wind turbines deliver alternating current at a frequency that cannot be used directly. At the same time, electricity consumers have individual needs in terms of current and voltage. The energy-saving potential is immense, because statistically speaking, electricity already passes through at least one converter on its way from the generator to the consumer. According to a study by the European Center for Power Electronics (ECPE), more than a quarter of electrical energy could be saved by using modern power electronics.

And in some areas, silicon is no longer the first choice. Wide bandgap semiconductors, such as the increasingly used silicon carbide (SiC) and gallium nitride (GaN), benefit from higher switching power while maintaining low losses. However, according to analysts at Yole Développement, the technology is still at an early stage of development. They expect SiC devices to generate $6.3 billion in sales in 2027. In the meantime, silicon devices continue to surprise with significant performance gains and will continue to be a source of revenue for the industry in the coming decades. In general, thermal management, robustness, reliability and ultimately packaging continue to be key issues in semiconductors.

Embedded systems

Semiconductors are also the building blocks of embedded systems in a digital, networked and automated energy world. For example, they provide data on the state of the grid, the temperature, the current flow and the angle of the cables. The data is processed in the cloud or directly on site (edge) with AI algorithms. Embedded systems are also transforming traditional building automation into a form of prediction-based management that offers significant potential for energy savings. And in the future, buildings with smart meters (iMSys) connected to a smart grid will not only be able to optimize their own consumption, but also take on the role of electricity producer themselves by feeding surplus energy into the grid.

Interview with Hive Power –Innovative solutions for smart grids

Founded in Switzerland in 2017, Hive Power is a leading provider of innovative smart grid solutions. Hive Power offers a SaaS platform that optimizes existing electrical distribution networks, both from a technical and economic point of view.

Hive Power’s team consists of researchers and scientists with deep knowledge in smart grids, data science and optimization with many years of experience in research and pilot projects on distributed energy management. We spoke with Mr. Gianluca Corbellini, CEO of Hive Power and appreciate the informative answers.

5 Questions for Mr. Ginaluca Corbellini from Hive Power

Q: What has your experience been like tackling the traditional grid with new ideas?

A: It’s been an impactful journey. When we set out in 2017, we had a clear objective to optimize flexibility management for distribution grids and energy suppliers. And we have proven our viability and market fit with our applications for Flexibility Orchestration used in operation by our customers who are innovating from the traditional grid into the smart grid.

Through the help of key mobility industry players, we have tested smart-grid applicable solutions like Vehicle-to-Grid and EV smart charging and produced the FLEXO Smart EV Charging solution that serves automotive companies and EV fleet managers.

Q: What’s your most interesting smart grid application project so far?

A: It’s hard to choose because we worked on amazing smart grids, mobility research, and pilot projects around Europe. One that stands out is called DrainSpotter. It’s unique because we’re developing a solution that faces the consumers and the Distribution System Operator – in this case, AEM.

DrainSpotter is an intuitive mobile application that consumers can use to monitor their electricity usage over time, receive informative summaries of their consumer behaviour, and be automatically notified about anomalies detected by machine learning algorithms.

Through this app, AEM’s residential users eliminate excessive standby power – over 200 W. If they do this consecutively for two weeks, AEM will deliver 10% less energy in total, and 5% of customers would reduce their total energy consumption by at least 20%, and 4.2% of customers would save at least €513 off their total energy bill over 1.5 years.

Q: Looking at the entire smart grid market in Europe, how is Germany performing relatively?

A: As you’ve pointed out earlier, Germany excels in their renewable energy journey. In the first half of this year, 49% of the power used in Germany was generated from renewable sources – that translates into a growth in smart grid adoption. Judging from the SINTEG project, the German government seems committed to increasing smart grid technology. There’s a reliable forecast that Germany’s smart grid investment will increase to $23.6 billion between 2016 and 2026.

There’s a lot of potential in this market, especially in the applications of Electric vehicles, as the boom of EVs is coming alongside smart grids. EV charging in Germany will need to be smarter and more cost-effective as they can interact with the grid and provide Vehicle-to-Grid services using enabling platforms like our FLEXO Smart EV Charging.

Q: How important are smart meters in this innovative smart grid journey?

A: Smart meters make smart grids possible! A smart grid uses advanced metering infrastructure (AMI) (which consists of smart meters, sensors, communications protocols and data management systems) to monitor and control energy demand, distribution, and generation in near real-time.

We need more smart meters to enable our innovative grid systems to make accurate decisions and predictions from the data generated at these smart meter points. For example, the AI algorithms we create in Hive Power are made possible by the enormous amount of data collected from smart meters.

Q: Lastly, What would you say are the most important benefits of smart grids?

A: Sustainability, cost-saving, and energy decentralization!

Having sustainable earth is the grand reason why we are promoting renewable energy sources; we want to reduce greenhouse gas emissions. Smart grids make it possible to effectively manage and optimize the mix of these variable sources of energy without interrupting the energy supply. Consequently, smart grids save energy consumers and producers a lot of costs through proper grid balancing, voltage and frequency anomaly detection, and demand response.

Lastly, smart grids make it possible for us to have integrated microgrids. So homes or communities can produce renewable energy, manage their energy, and sell and buy from the main grid as needed. Sounds impressive, right? We are active in this field and making outstanding contributions to projects around Europe with our FLEXO Community Manager.

Thank you Mr. Corbellini for the exciting interview – we at magility look forward to following the developments of Hive Power further.

Magility’s vision of the future

Smart grid technology is booming, and the federal government is offering incentives for implementation. In addition, smart meter installations are expected to increase. As the cumulative market capitalization will increase exponentially in the coming years, this could be the beginning of a new era.

The smart grids of the future could also solve the problem of charging stations for electric vehicles. But they are not only valuable for closing the gap between supply and demand for intermittent renewable energy sources.

With sufficiently intelligent power grids, power spikes and the frequency of power outages can be prevented. Once this technology is fully installed, including in the field, it will also be able to significantly reduce energy costs and facilitate real-time data control and large-scale charging.

At Magility, we are watching these exciting developments and will keep you updated. 

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