© CGI Group Inc.

The Smart Grid Challenge: Innovation in grid, smart meters and data analytics

Richard Hampshire | Partner | Smart Utilities

27 March 2014

Consumers

CGI Smart Utilities | Context

The Energy Challenge

Reliability of

Supply

Exposure to

Global Markets

Decarbonising

Energy

Impact on disposable

income

Energy

Austerity?

2

0

50

100

150

200

250

300

350

400

450

500

550

1970 1980 1990 2000 2010 2020 2030 2040 2050

Ele

ctr

icit

y D

em

an

d (

TW

hs

de

live

red

)

Year

Undefined

New Imports

New Capacity Renewables

New Capacity CCGT

New Capacity IGCC

Imports

Renewables

CCGT

Thermal Plant

Nuclear

Security of Supply

Britain's Capacity Challenge

3

Undefined new

generating capacity

requirement

Fossil Fuel Thermal Generation

Nuclear

CCGT

Renewables

Imports

Sources:

• DUKES 2009

• Energy Technologies Institute, 2009

• Mind the Gap | The Black Hole at the Heart of the UK’s Energy Supply, LogicaCMG, 2006

Planned new

capacity

Today

• “Energy Gap” projected 2016-2018

• Increase risk of interruptions to supply

• Implications for achieving climate change objectives

• Increasing reliance on imported primary fuels for generation

Plant Life

Extensions

Security of Supply

Balancing Capacity and Demand

The Low Carbon Technology Adoption Challenge

Source: Network Operator Smart Metering Data Requirements, SBGI meeting (24 June 2010)

“With a smart network - significant opportunity to optimise

charging as EVs will remain stationary overnight”

4

Affordability

Residential Consumer Energy Prices vs Bills Across Europe

5

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

€ 0.000

€ 0.050

€ 0.100

€ 0.150

€ 0.200

€ 0.250

€ 0.300

€ 0.350

Avera

ge h

ou

seh

old

's e

xp

en

dit

ure

on

en

erg

y a

s a

p

erc

en

tag

e o

f to

tal

exp

en

dit

ure

Resid

en

tial

en

d-u

ser

un

it e

nerg

y p

rices (€ / k

Wh

)

Country Ordered by Electricity Unit Rate

Residential end-user electricity prices across Europe, (inclusive of taxes), in 2011 in € per kilowatt-hour

Residential end-user gas prices across Europe, inclusive of taxes, in 2011 in €per kilowatt-hour

Average household's expenditure onenergy

Sources:

• Energy Price Data: European Residential Energy Price

Report, 2012, VaasaETT Global energy Think Tank

• Household expenditure on energy: Fact-file: The Cold

Man of Europe, Association for the Conservation of

Energy, March 2013

British Energy Costs:

1. Second highest average household

expenditure on energy

2. Third lowest unit electricity cost

3. Lowest unit gas cost

4. Highest incidence of ‘Energy Poverty’

1.

2.

3.

Affordability

Energy Security, Affordability and Economic Impact

6

80%

90%

100%

110%

120%

130%

140%

150%

160%

170%

180%

1998 2000 2002 2004 2006 2008 2010 2012

Average Real Terms Domestic Total Energy Bill for Consumers in England and Wales

(base year 2005)

Source: Based on DECC Quarterly Energy Prices, March 2013

Bills adjusted to 2005 terms using the GDP (market prices) deflator

Average bill calculated on basis of payment type distribution

2005 base = £644.82 (2012 average bill is £1276.90 on cash basis)

7

Affordability

Demand Side Efficiencies

Distributed

Energy

Innovative

Supply Tariffs

Average Unit Price

Vo

lum

e o

f E

ne

rgy C

on

su

me

d

Baseline Total Energy Cost

Energy

Management

Baseline Total Energy Cost

Managed Total Energy Cost

• Managing Energy

• Eliminate waste

• Manage

consumption

• When, not just

how much

• Innovative Tariffs

• Competitive

market

• Reward Tariffs

• Time of Use

• Distributed Energy

• Micro generation

• Distributed heat

So what are ‘Smart Grids’?

Hydroelectric

Power

Residential Micro-generation

Local Control

of LV network

Industrial

Micro-generation

Wind farm

Central Generation

Bidirectional

Energy Flow

Distributed

Generation

“Electricity networks that can intelligently integrate the behaviour and actions of all users connected to it - generators, consumers and those that do both – in order to

efficiently deliver sustainable, economic and secure electricity supplies”

8

Source: European Technology Platform Smart Grids

It’s all about Energy Security:

• We are transforming how we satisfy our thirst for energy

• Our relationship with energy has to change

• Britain is on a journey

• We are transitioning to a low carbon economy

... so what does that mean?

• More journeys will be powered by electricity rather than petrol or

diesel

• More space heating by heat pumps rather than gas boilers

• More energy demand satisfied locally by micro generators

• Replacement of centralised generation with more intermittent,

renewable sources

... and that means a more intelligent energy system

• we’ll be designing and operating our energy networks differently

9

... but why do we need a “Smart Grid”?

10

First things first: Smart Metering

• Deploying smart metering creates an information and communication

infrastructure

• It’s just and enabler....

• ... but enabler for what?

• Rewarding consumers for changing how they use energy

• Encouraging the adoption of low carbon technologies

• Creating the foundation for “Smart Grids”

Next things next: ... from an information and comms infrastructure to a smart grid

• The right smart tariff can create enough reward to change behaviour

• ... but do we need a “smart grid” yet?

• Smart meters can be used to encourage the adoption of low carbon technologies through fiscal incentives

• Transferring energy for heat and transport from fossil fuels to electricity increases demand on the network

• Introducing embedded generation into primary and secondary distribution networks increases volatility, reduces load factor and risks a net export situation

• More renewables increases intermittency in available generation capacity

• ... we need to design and operate our networks differently to mitigate these issues. The solution?

An intelligent network that can efficiently deliver sustainable, economic and secure electricity supplies

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Realising the Benefits of

Investment in Smart

Aligning Investment with Return

Progressive Deployment

Technology Maturity & Innovation

Market Maturity & Consumer Attitudes

Market Structure, Policy and Regulation

CGI Smart Utilities | Delivering Smart

Smart – A Multi-Dimensional Challenge

12

Evolution of a More Intelligent Energy System P

re 2

01

0

20

10

-20

2

02

0-3

0

Po

st

20

30

Generation Transmission Distribution Metering Demand Side

Gro

win

g P

en

etr

ati

on

of

Lo

w

Carb

on

Gen

era

tio

n

Measurement

and Control

Incre

asin

g

Au

tom

ati

on

Pro

gre

ssiv

e d

ep

loy

men

t o

f m

easu

rem

en

t

dev

ices,

follo

wed

by

co

ntr

ol

an

d

au

tom

ati

on

tech

no

log

ies i

n r

esp

on

se t

o

incre

asin

g d

ep

loy

men

t o

f o

f L

ow

Carb

on

Gen

era

tio

n a

nd

dem

an

d o

n n

etw

ork

s

Dep

loy

men

t o

f

sm

art

mete

rin

g

Incre

asin

g a

do

pti

on

of

low

carb

on

dem

an

d a

nd

gen

era

tio

n b

ey

on

d t

he

mete

r – c

han

gin

g h

ow

netw

ork

s a

re

desig

ned

an

d o

pera

ted

Smart DCC Ltd

No. 14

DSP Role in the British Market Data Service Provision to the DCC based on Instant Energy

14

DSP

Comms Hub Comms Networks Data Systems DCC User

Gateway

Energy

Retailer

Third

Parties

Distribution

System

Operator

DSO

MDMS

Supplier

MDMS

Smart Grid

Control

Smart

Energy

Retail CC&B

No. 15

DSP Role in Other Markets The Heart of a DSO’s collection of data from smart meters

DSP Equivalent

Solution

DSP Obligations

become part of the DSO

span of responsibility

DSO Smart Responsibility

Meter and

Comms Hub

Provision

Comms Networks Data Systems

DSO

Service

Gateway

Energy

Retailer

Third

Parties

Distribution

System

Operator

15

DSO

MDMS

Supplier

MDMS

Smart Grid

Control

Smart

Energy

Retail CC&B

CGI | Smart Grids

Low Carbon London - A learning journey

Learning how to create a low carbon city

Technologies

• Distributed

Generation

• Heat Pumps and

Electric Vehicles

• Demand Side

Management

• Wind Twinning

Low Carbon London

To understand how electricity network design, their operation and the associated commercial arrangements will need change to enable the adoption of low carbon technologies into people’s homes and upstream of the transformers

Our Role:

• Smart Data Service

• Programme Management

• Carbon Accounting

• Consultancy

• Design

• Security | PIA

The Low Carbon London, using

Instant Energy, is recognised by

IDC Energy Insights as an

exemplar smart grid programme

for promoting innovation in

distribution networks 16

For more information on Low Carbon London,

go to: http://www.lowcarbonlondon.info/

CGI | Smart Grids

Project Falcon- another learning journey

Learning how a low carbon economy will impact traditional approaches to

maintaining the network Technologies

• WiMax Networks

• Battery Storage

• Demand Side

Management

• Distributed

Generation

Project Falcon

FALCON aims to

facilitate the installation

of low carbon

technologies by

delivering faster and

cheaper HV network

connections.

This is achieved by

reducing traditional

reinforcement. The trial

will provide learning on

the use of real time data

to inform network

planning rather than

traditional indicators such

as total demand and

engineering guidelines.

Our Role:

• Consultancy - Technical

• Project Management

• Benefits Management

• Data Strategy and Consulting

17

CGI | Smart Grids

InovGrid

18

InovGrid was selected by the European

Commission and Eurelectric, from more than

260 competing programmes, as the leading

smart grids reference project in Europe.

CGI’s Role:

• System Development

• System Integration

• Sm@rtering Product

• Smart meters provide the infrastructure on which energy suppliers can create

innovative tariffs that reward consumers for changing how they use energy

• Smart grids are a mitigation to some of the impacts of the shift to a low

carbon economy...

• ... and the associated cost implications if we continue to design and operate our

networks in the way we do today

• For consumers who have the ability to manage how and when they consume

energy, and embrace the opportunity to do so, they can reduce their

exposure to rising energy costs

• The British market is different because of our combination of challenges

• Maximise the value of the market, make it easy to operate here and

• we’ll be more than the cradle of low carbon innovation

• Britain can be at the heart of the supply chain for low carbon technologies

• The biggest opportunities come from growing the market

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Closing thoughts...

More Information for Utilities

www.cgi-group.co.uk/smartmeter

ingfordummies

www.cgi-group.co.uk/smartgridsf

ordummies

www.cgi-group.co.uk/newnuclea

rpowerfordummies

More information about Utilities can be found in CGI’s “Smart Metering for Dummies”, “Smart

Grids for Dummies”, “New Nuclear Power for Dummies”, “Implementing EAM for Dummies” and

“GB Electricity Industry for Dummies”

www.cgi-group.co.uk/ieamfordu

mmies

www.cgi-group.co.uk/GBEIforDu

mmies

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Thank you

Company Address:

CGI

Kings Place

90 York Way

London

N1 9AG

UK

Contact person:

Richard Hampshire

M: +44 (0) 7711 035 899

E: rich.hampshire@cgi.com

T: @RJHampshire

www.cgi.com

Our commitment to you We approach every engagement with one

objective in mind: to help clients succeed

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