In February this year I moved back to the UK to take up a position at the University of Oxford to manage the recently funded Oxford Martin Programme on Integrating Renewable Energy. Having spent five years living and working in New Zealand, and most of them leading the demand side research of the GREEN Grid research project (trying to better understand current patterns of household energy demand, the desire for and uptake of new energy technologies, and the impacts this may have on the grid), moving back to the UK shifted my research and thinking into a whole new dimension.
While there are many similarities between the UK and NZ (think language, culture, weather...) there are also some major differences when it comes to thinking about energy systems. Perhaps the first and most obvious is that New Zealand’s electricity system is close to 80% renewable. The country has substantial hydro and geothermal resources that easily cover the demands of its 4 million residents, with growing wind and solar generation that hopes to take it closer to 100%. On top of this, few areas have access to pumped gas so electricity dominates the space and water heating sectors. This is a far cry from the UK, where only 25% of electricity comes from renewables, and the bulk of space and water heating is fuelled by gas.
So why does all this matter?
To meet 1.5-degree target recently agreed in Paris, we need to decarbonise energy systems around the world, decreasing our dependence on coal, oil, and gas, and fast. In fact, in a talk recently given by Myles Allen at the Oxford Martin School, he explored the implications of different decarbonisation strategies on temperature rise, and showed that electricity systems needs to decarbonise rapidly to keep warming limited to between 1.5 and 2 degrees. And a paper recently published in Applied Energy shows we can't afford to build any more fossil fuel power plants after 2017 (that’s next year) unless we retrofit them with carbon capture technology, which isn’t yet feasible.
In the UK this means that we need to act quickly to up the share of renewables in our electricity system (particularly in light of planned plant closures in the coming years) and find ways to electrify the heat and transport sectors, currently heavily reliant on fossils. And doing all this brings up a number of key challenges.
The first challenge is in making sure the electricity system continues to be able to provide power to users they need it. Increasing amounts of wind and solar will require increased system flexibility to cope with these variable resources to ensure that supply and demand is balanced at all points in time. This challenge will be compounded particularly by the electrification of heating processes, which means that demand will be highest in winter, whereas solar generation will be highest in summer. Flexibility measures to cope with the increased variability in supply and demand could come from some combination of storage, long-distance interconnects, and demand side management, and understanding how to optimally combine these flexibility measures to keep the grid running effectively and efficiently will be critical.
The second challenge - also about balancing supply and demand in the grid - comes about because of changing nature of where we are generating electricity. When the grid was first developed it was designed for a system in which power was generated in centralised plants and dispatched to end users to meet their needs. While many elements of this remain today, the quantities of distributed generation in the system are increasing at a rapid rate. Much of this generation happens on an end-user's premises and feeds into the distribution network (rather than the centralised transmission system), and a large quantity is “behind the meter”. This means that the system operator - responsible for balancing supply and demand in the grid - doesn’t know how much electricity is being produced by these resources, and cannot include it in their dispatch models. It also means that is many instances, large quantities of power are being injected into distribution networks (for example, the middle of a sunny summer day when demand is low but solar generation is high), which are becoming overloaded. Understanding how to best balance supply and demand, not just over time, but also accounting for grid stress in different geographical locations, will be critical keeping the lights on across the UK.
The third key challenge relates to the electricity market, which, in its current form is ill-suited to incentivise effective investment in and operation of electricity systems with high quantities of renewables. Existing market structures were designed for systems dominated by fossil-fuel based technologies with significant operating costs, and they fail to send appropriate signals for investment or dispatch of low carbon technologies with high capital but low running costs. They also fail to effectively incorporate consumers, who are becoming increasingly active as owners and operators of distributed energy resources such as including micro-generation, storage, and demand response measures. Exploring market mechanisms that: (1) redefine the "consumer offering" as a service-oriented provision, (2) consider the value proposition to all stakeholders, and (3) address location (to manage constraints at multiple scales) - all while recognising the profoundly different characteristics between low carbon and traditional generation, will be key to address innovations in supply, storage and demand management necessary for a low carbon economy.
These challenges are complex and multi-faceted, and solving them will require an evolved way of thinking that is collaborative, cross-disciplinary, and inclusive of multiple perspectives, in order to identify innovative and workable solutions. This, perhaps, is what excites me most about my new role in managing the Oxford Martin Programme on Integrating Renewable Energy; this project brings together a fabulous team of brilliant minds to explore these challenges and identify a range of social, technical, market and regulatory implications for a 1.5-degree mitigation pathway.