The Digital Transformation of Electricity Markets

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1 The Digital Transformation of Electricity Markets Hando Sutter CEO, Eesti Energia Smart meters change the way electricity markets function By the end of 2016 in Estonia all consumers will have hourly data about their energy consumption 1

2 Smart Meters in the Electricity Market Smart meters measure the electricity consumed and produced 2 Distribution system operators Client s consumption & production data is sent to the data hub 3 Central data hub 1 Prosumers Energy seller receives info about client s consumption & production Invoice for the consumed energy, payment for the produced energy + consumption management services 4 Energy sellers Energy company buys or sells electricity on NordPool 5 Achievement: DSO is more efficient Reduced network losses 2012: 5,7% : 5,2% : 4,7% Convenience and new solutions for clients Client inquiries have reduced by 50% Client satisfaction increased 39 > 52 Improved grid planning & investments based on peak loads Potential big data opportunities & faster reaction to blackouts 2

3 Achievement: TSO Functions As a Data Hub Personal data about consumption, production, seller authorizations Calculations of right amperage level Tools for apartment associations to bundle electricity agreements Consumer flexibility to the market Innovation: product development opportunities for start-ups Achievement: Increased Awareness of Volatile Electricity Market 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% Amount of SPOT agreements has more than doubled in 3 years and continues to grow 0% Q3 Q4 Q3 Q4 Q3 Q fix combi spot 3

4 Achievement: Active Market and Smart Services Switching is easy, consumption data is available Solutions for analyzing electricity consumption Solutions for shifting energy consumption to off-peak hours Smart solutions on when to buy energy and when to use stored energy In Digital Electricity Markets Consumers Become More Involved Electricity contract information Price updates for the next day Consumption information Price alarms Billing information & payments 4

5 Achievement: Power Generation Moves to the Consumers Site Awareness on electricity market increases interest towards small-scale electricity production Within 3 years we have ~500 micro producers, this number will increase Eesti Energia s pilot project in 2016 brought energy savings of 30%. Achievement: More Effective System Balancing Consumers become part of system balancing: Effective response services for customers to shift the consumption curve Hourly data allows the TSO to follow the shift in demand curve Digitalized production management enables producers to plan energy production more accurately (i.e based on fuel quality) Eesti Energia s new Auvere 300MW power plant can use up to 50% biomass 5

6 Achievement: Less Burden on Society Map: real time energy consumption in Estonia measured by smart meters consumption points, investments approx. 100 mln EUR Significant decrease of network losses from 5,7% to 4,7% 50% less client inquiries in 3 years Improved cost efficiency in network planning and maintenance Increased energy efficiency and effective system balancing Remote Reading Solutions Know-How Electricity supplier Eesti Energia, DSO Elektrilevi, data hub developers and Ericsson have implemented variety of solutions for smart energy market Data Hub Smart metering Smart enduser services Platform for electricity consumption data Processing energy consumption data Solutions for analyzing electricity consumption (e.g. mobile apps) Platform for new end-user services Integration with the demand response technologies Solutions for shifting energy consumption and reducing costs 6

7 Estonian Experience to Share Our know-how Description Legislation consulting Legislation analysis for data hub and smart-grid Operational requirements and implementation of smart systems Business consulting Determining best business models for the retail market Project management Implementing smart metering system Consultation on procurements and contracts DSO tools Planning and optimizing tools End-user products Tools for processing consumption data Balance management Consumer behavior analysis tools End-user apps Key performance indicators X-Road National data system Data warehouse Data hub development Thank you! 7