03/04/2010 by David Slade.

The energy world is about to turn upside down. With the coming of smart grid, the electricity consumer customer becomes the electricity seller; the passive home appliance becomes the active energy manager; and the local 11KV DNO network becomes the power generation network itself.

Such an upheaval means that the energy world needs to start thinking about a new business model, says a recent report by IBM Global Business Services Energy and Utilities.

The fact that IBM is advising the energy industry is itself a point of interest, yet another signal of the new market opportunity emerging within the energy arena for information technology. This opportunity has drawn the attention of not only IBM, but also CISCO, Google and many others.

So how does IBM see the energy business model changing? First consider what it has been for the last century: a grow-and-build model. Utilities encouraged more and more consumption, and they built power plants and transmission to the far corners of the nation to serve the growing demand.

“The success of this strategy was remarkable. In the United States for example, from 1920 to the mid 1960s (excepting the period of the Great Depression), usage increased at seven percent annually – about five times the rate of usage of all forms of energy combined and three times the rate of economic expansion in general,” says the IBM report, “Switching perspectives: Creating new business models for a changing world of energy.”

But today we no longer need such expansion. The grow-and-build model is obsolete, yet continues to be used by utilities. As a result, utility stocks, which in the 1940s-1960s significantly outperformed the Dow Jones Industrial Average, now lag well behind.

Instead of expanding their territory, utilities are being called upon to change their product — to offer energy that is more efficient and clean and service that is more consumer-friendly.

Smart grid technology can help utilities meet today’s imperative. But it brings with it a new and complex relationship between customer and utility. This is because smart grid allows consumers to control energy usage via a home computer. With smart buildings into the mix and their appliances can control energy usage without the consumer doing anything. And with increased use of solar energy and other distributed technologies, the home also becomes power plant and storage facility for the electric utility.

“Companies willing to tackle industry model innovation and sit at the nexus of new complex relationships among business partners and customers will be well positioned to create and capture new demand for emerging products and services. Strong growth in revenues and profits – albeit accompanied by some risks – is achievable in multisided business models because of the embedded network economies of scale (i.e., margins increase with network size),” says the report.

IBM calls this new business model “a multisided platform.” What does it look like?

“Manufacturers, retailers and shoppers all benefit from having a single location where they can meet and transact business. A wider variety of stores and services brings more shoppers; more shoppers bring higher sales volumes for manufacturers and lower costs for retailers (and, in theory, also lower prices for shoppers). Thus, some element of network economy is bundled into the shopping center value proposition. The platform owner (the shopping center operator) extracts some of this value in the form of rent to store owners and, in some cases, service fees to shoppers,” says the report.

If indeed this is the future, it won’t be embraced quickly or easily by utilities, which are notorious for their caution. For those who do move forward, here is some of what IBM advises.

Be sure your current customer base is sizable enough to ensure that you get a meaningful head start.

But don’t hurry. History has shown that later movers may actually benefit from standing back from the first wave of early adopters.

Time the announcement of your new business model carefully to avoid shocking long-time constituencies or alerting rivals too soon.

But in the UK, the cat has already leaped out of the bag!

The UK Regulator - Ofgem’s duty to contribute to the achievement of sustainable development promoted this duty, placing it on an equal footing with its duties to meet reasonable demand and financing authorised activities. The principle objective, to protect the interests of consumers, refers to future as well as existing consumers. These changes underline Ofgem’s important and developing role in shaping the future of gas and electricity industries in a sustainable manner.The UK is facing a future that involves increased geopolitical risks to energy security, potentially higher energy prices and the need to do much more to reduce greenhouse gas emissions while making sure everyone can afford to adequately heat their homes.

While much of what is needed to deliver sustainability is not within the regulators direct control, a responsibility to facilitate change by engaging in the debate, trying to persuade relevant players to make changes where required and contributing information and expertise where it can.

Actions speak louder than words:

So whats already implemented in the UK?

• Smart metering (CoP10) with import and export facilities - Coming to every home in the UK - See my blog on smart metering for more information
• feed-in tariffs (FITs) for small-scale low-carbon electricity generation from 1 April 2010 - Customers own micro energy generation agreements connected to the local DNO grid - See FITs for more information
• Climate Levy Tax incentives - Look at you next bill and spot this tax!
• ROC’s - See my blog for more information
• REGO - See my blog for more information
• OGEMs - See my blog for more information
• REC’s - See my blog for more information

The next step:

• Informing the customer and proving ‘idiots’ guides to understand the available technologies and energy savings available.
• Providing engineering design  and installation solutions.
• The correct customer incentives to explore and implements these technologies.

Posted in Smart Grid Technology, Smart homes, smart meters, Smart Grid Maturity Model, Renewable Energy Certificate (REC), Smart Buildings, Renewable Obligation Certificates (ROC), Renewable Energy Guarantee of Origin (REGO), Renewable energy, Sustainability, Wind energy, Renewable tariffs, Small Scale Embedded Generator (SSEG), Renewable power | No Comments »

05/06/2009 by David Slade.

Use a stream or river to generate electricity

Hydroelectricity systems generate electricity from running water - usually a small stream. Small or “micro” hydroelectricity systems can produce enough electricity for lighting and electrical appliances in an average home.
Hydroelectricity systems are also called hydro power systems or just hydro systems.

How do hydro power systems work?

Hydro power systems use running water to turn a small turbine which generates electricity. The faster the water flows and the more water there is, the more electricity can be generated.

The amount of electricity a system actually generates depends on how efficiently it converts the power of the moving water into electrical power.

Hydro power systems convert potential energy stored in water held at height to kinetic energy

The benefits of hydro systems

• Cut your carbon footprint: hydroelectricity is green, renewable energy and doesn’t release any harmful carbon dioxide or other pollutants.
• Cut your electricity bills: hydroelectricity is free, so once you’ve paid for the initial installation you’ll reduce or even eliminate your electricity bills.
• A lower cost option: installing a hydro system can be expensive, but in many cases it’s less than the cost of getting a connection to the National Grid.
• Cheap heating and hot water: a hydro system may generate more electricity than you need for lighting your home and powering your electrical appliances - so you can use the excess to heat your home and your hot water too.

Is a hydro system suitable for my home?

To tell if a hydro system is right for you, there are a few key questions to consider:

• Is there a river or steam close to your home? You’ll need access to a fairly fast flowing water course, and the right to build around it

• Does the water flow vary significantly during the year? If so, the hydro system may not be able to supply you with all the electricity you need during dry months. If you’re not connected to the electricity grid, you’ll need a backup power system.

• Do you want to sell excess energy? Hydro systems can be connected to the National Grid if a suitable connection point is available. Any electricity you generate but don’t use can then be sold to electricity companies.

Costs and savings

Costs for installing a hydro system vary a lot, depending on the location and the amount of electricity it can generate. A typical 5kW scheme suitable for an average home might cost £20,000 - £25,000 including installation.

Savings depend on the amount of hydroelectricity that is used in place of electricity bought from another source. If the hydro system replaces electricity bought from the National Grid then typical savings could be substantial.

Maintenance costs vary but are usually low as hydro systems are very reliable.

Posted in Sustainability, Renewable power | No Comments »

05/06/2009 by David Slade.

Marine Current Turbines Ltd’s ‘tidal current turbines’ concept

Marine Current Turbines Ltd’s SeaGen turbine

Electricity generation from tidal stream has the big advantage that the output can be reliably predicted even though the strength of the tidal stream varies throughout the day. Various designs are being developed including propeller blades driving a generator (an underwater wind turbine), aerilon shaped wings that move up and down, and sets of sails turning on a conveyor.

Posted in Tidal renewable energy, Renewable energy, Sustainability | No Comments »

04/06/2009 by David Slade.

Chris Hermann, Senior Vice President, Energy Delivery, LG&

Six months into Louisville Gas & Electric Company’s (LG&E) pilot program that uses smart meters, smart or demand response appliances, and a tiered-pricing program, results reveal participants are choosing money saving options.

The program tests the use of “smart” appliances to help offset energy costs when higher prices are implemented during peak usage times, generally from 3-8 p.m.

Pilot participants were a select group of GE employees living in the LG&E Louisville market. They were provided with a suite of GE smart appliances – or demand response appliances – to replace their standard appliances. In most cases, this included a refrigerator, range, microwave, dish washer and laundry pair. In addition, LG&E installed a programmable HVAC thermostat in the participants’ homes, as well as a smart utility meter.

The smart appliances receive a signal from the utility company’s smart meter which alerts the appliances, and the participants, when peak electrical usage and rates are in effect. In the pilot program, the signal word “eco” comes up on the display screen. The appliances are programmed to avoid energy usage during that time or to operate on a lower wattage; however, participants can choose to override the program.

“This pilot program gives us the opportunity to incorporate our customers’ feedback on how to manage the very critical issue of peak energy demand and supply,” said Chris Hermann, senior vice president, Energy Delivery at LG&E. “We believe we are learning a lot from this pilot about how to accomplish our objectives. This will result in managing our energy better and reducing the need to construct more power generation facilities – which is better for us, our customers and the environment.”

Some of the examples of savings are that the refrigerator delays the defrost cycle from occurring during peak hours and goes into energy saving mode, microwave ovens power down slightly by reducing wattage used when operated during peak hours, and the ”smart” dishwasher and laundry can delay starting the cycle to off peak times.

Notably interaction with the dishwasher and laundry appliances has been noted as the most challenging by the participants.

Posted in Intelligent building, Integration, Renewable tariffs, metering, Sustainability | No Comments »

19/05/2009 by David Slade.

Solar generation

Photovoltaics and other methods of converting sunlight to electricity

There are several accepted ways of converting solar radiation to electrical power.

Photovoltaics

The sun’s energy can be converted directly into electricity using photovoltaic cells. PV cells can be used for applications as small as watches and calculators, to large grid-connected arrays of panels. The great attraction of PV technology is that it delivers electricity at the point of use, for example panels can be integrated into buildings to supply the buildings themselves.

In areas where grid connection or other forms of generation are too expensive or not feasible, PV can be very cost-effective. This may be in remote locations, but could also be in a city centre where grid connection may be impractical. For example it can be cheaper to power parking meters with solar energy than with power from the grid.

PV materials are usually solid-state semiconductors. various forms are used:

• Mono-crystalline silicon
• Poly-crystalline silicon
• Amorphous silicon thin film
• Thin film cells of other materials such as copper indium diselenide (CIS) and cadmium telluride
• Organic solar cells

Other technologies are also under development

Solar thermal power generation

Technologies also exist to collect the sun’s heat and use it generate steam, which then produces electricity using a conventional turbine.

One notable example of this approach is the solar ‘power tower’ approach where fields of mirros are used to focus the sun’s rays onto a boiler at the top of a tower.

Posted in Photovoltaics, Renewable energy, Sustainability, Green buildings, Renewable power | No Comments »

19/05/2009 by David Slade.

Overview of renewable energy

Renewables describe energy sources that do not deplete the earth’s natural resources and do not create added waste products. They are therefore sustainable in that they can be used indefinitely without degrading the environment.

The fact that renewables are the only truly sustainable forms of energy production clearly makes them desirable. The impetus for renewable energy has grown much stronger in recent years due to two related drivers: “Energy security” and “Climate change”.

There are renewable options for all of the three major energy forms: electricity, heat and fuel. Some renewables directly use a climatic resource; others use renewable fuels as the medium for delivering energy.

Elemental renewables

The main climatic or environmental renewable energy resources are:

• Solar radiation - Both light and heat from the sun can be harnessed for their energy, and several different conversion techniques have been developed. Solar energy can be collected directly as heat or converted to electrical power. Solar power is also the ultimate cause of winds, waves and plants, so the source of almost all the earth’s energy.
• Water power was the first source of large scale “Hydropower”>electricity generation, but was used long before that for mechanical energy in water mills. Water can also be used as a thermal source for heat pumps.
• Wind too has been used for centuries as a source of energy both for motive power (such as windmills and wind pumps) and more recently “Wind energy” power generation. The ambient air can also be used as a thermal source for heat pumps.
• Wave and tidal energy are more recently exploited sources offering potential again mainly for Marine renewables electricity production.
• Geothermal heat can also be harnessed and used directly for Geothermal heat production or through a steam turbine for Geo-energy electricity. Ground source heat pumps also use the constant temperature of the earth’s sub-soil as a source of heat.
• There are also areas of the earth’s crust with liquid or gas reserves where the high geo-pressure can be used to drive “Geo-energy”electricity turbines.

Any of these sources, which use heat as a means of producting electricity, such as solar furnaces and geothermal generation, can also be used for Combined Heat and power.

Biological renewables

Biomass is also considered a renewable source of fuel because is absorbs carbon dioxide from the atmosphere, while growing. When it is later converted to energy, the carbon dioxide released back into the atmosphere matches that originally absorbed, so the whole cycle is carbon neutral.

Of course the same can be said of fossil fuels, but there the cycle is very long (millions or years); biomass is the term applied to crops (or animal by-products) grown over no more than a few decades. The following are examples of biomass accepted as renewable fuels:

• Energy crops – agricultural and forestry products grown specifically to be used for energy production, such as short rotation coppice and miscanthus.
• Standard crops and their by-products. Many crops can be used for food or fuel, such as corn, oilseed rape, wheat and many others. Many food crops have by-products, such as straw, which can be used for energy production, while the main product is used for food.
• Forestry and forestry by-products. Again timber can be used for fuel, but more commonly the non-commercial by-products, such as sawdust, small round-wood, thinnings etc. can be diverted to renewable energy production.
• The biomass element of waste streams including ICW and MSW is another source of renewable bioenergy.
• Similarly certain animal by-products from the food chain can be used for renewable fuel production.

These sources all provide fuels or products than can be converted to fuels, of many different types: liquids, gases, pellets, chips and other solid fuels. In this form they can be used for any form of energy production:

Biomass heat / Bioenergy electricity generation,
Combined heat and power
Transport biofuels

Posted in Renewable energy, Energy, Sustainability, Renewable power | No Comments »

18/05/2009 by David Slade.

Companies are plugging into new green markets.

Survey indicates companies will implement ‘transformational’ sustainability programmes by 2012.

Company sustainability programmes that are currently developing on an incremental basis can be expected to start transforming businesses by 2012, according to a cross industry survey.

Businesses expect fast innovation in sustainability to be required to meet the lightning pace of climate change legislation, consumer demand and rising energy costs.

Financial impacts

Companies sample surveyed revealed that by 2012 the financial impact of regulations would be a key concern to financial directors compared to 2009 due to the extra carbon costs on flights, energy and the cost of inclusion in cap and trade schemes. The cost concerns of companies included:

• Flights within EU airspace will be subject to a 97% cap on emissions (relative to the 2006 baseline) from 2012. This will add to the cost of flying.

• The percentage of EU Emissions Trading scheme CO2 allowances sold at auction will increase year-on-year which adds to the wholesale price of electricity.

• From January 2010, US firms with high emissions need to collect GHG emissions data and report it from January 2011. January 2013 is a likely start date for cap-and-trade in the US.

• UK Carbon Reduction Commitment affects 5,000 private and public sector organizations from April 2010. The first performance league table and payments are due in October 2011.

Product innovation

Low carbon product development will be an important area of innovation by 2012, according to the company research. The success of product take up will depend on carbon legislation deadlines and ease of diffusion in the marketplace.

Other product innovation drivers will include the price of carbon, energy, and competitive dynamics between companies, which is expected to drive demand ahead of regulation.

Companies that started the R&D process in 07/08 to create low carbon products can be expected to trigger demand and substitution from 2012, according to the research.

Analysis suggests carbon management software will become increasingly important for companies attempting to monitor and reduce their emissions. The company survey identified regulations, risk management and competitive dynamics as key areas that will drive adoption of carbon management software from 2009.

Posted in Sustainability | No Comments »