Realizing the Flexibility Potential of Industrial Electricity Demand: Overview of the H2020 Project IndustRE

Transcription

1 EMART Energy 2017: Commercial and Industrial Energy Users Amsterdam, 4 th October 2017 Realizing the Flexibility Potential of Industrial Electricity Demand: Overview of the H2020 Project IndustRE Dimitrios Papadaskalopoulos Imperial College London This project has received funding from the European Union s Horizon2020 research and Innovation programme under grant agreement No The sole responsibility for the content of this presentation lies with the authors. It does not necessarily reflect the opinion of the European Union. Neither INEA nor the European Commission are responsible for any use that may be made of the information contained therein

2 Challenges for European power system Under-utilized, inefficient generation units required to balance renewables variability or significant renewable power curtailment Demand [GW] Time [h] 0% penetration 10% penetration 30% penetration 50% penetration 100% penetration Significant amount of under-utilized generation and network capacity required to cover demand peaks

3 Motivation The cost-effective transition to a low-carbon European power system The rising cost of electricity and its effects on the competitiveness of the European Industry the IndustRE project sees the industrial electricity demand flexibility as an opportunity to deal with both challenges at the same time

4 Objectives The project brings together the large industry with the renewable energy community in order find common ground and create win-win situations. Formulate business models Develop tools to facilitate their adoption Quantify the potential benefits for the power system and industrial consumers Formulate regulatory and policy recommendations

5 Project Focus & Geographical Coverage

6 Business Models Available tools Flexible demand only + contract with offsite VRE + contract with onsite VRE Savings Energy costs 1 Supplier price response Market price response 3 Long-term electricity supply 5 Long-term electricity supply Network and other regulated costs ToU network tariff Volumetric tariff response Revenues System services 2 Balancing provision and other services 4 Bilateral balancing provision

7 Demand flexibility audits Demand flexibility audit execution in 3 major steps: Identification: Quantification: Valorization: Which industrial processes or equipment of the facility contain demand side flexibility? How much flexibility is available in the identified parts? How much money can be made with the quantified flexibility? business model day-ahead regulation business case calculation method PP business case day-ahead company X BE market data day-ahead flexibility model company X

8 Case studies Sector Country Flexibility Business model Paper Belgium Overcapacity of pulp factory Bilateral balancing provision Steel foundry Italy Thermal buffer in induction furnace Day-ahead market Distribution centre United Kingdom Thermal buffer in cold storage, emergency generators, battery storage of fork lifts Day-ahead market, reserves market Water treatment Germany Switching between electricity and gas On-site VRE, Dayahead market Cold storage France Thermal buffer Day-ahead market, reserves market Gas refinery Germany Overcapacity of liquefaction process Day-ahead market Non-ferrous metals Germany Thermal buffer in induction furnace Day-ahead market

9 Whole electricity system model (WeSIM) Interconnected EU system 2030 development scenarios EU Electricity Demand, Generation and Network data WeSIM: Minimise overall investment and operation costs of European power system Renewable generation targets and system security constraints Investment in network assets Investment in generation assets Operation scheduling of generation, storage and flexible demand Representative distribution networks in different countries Generic model of demand flexibility: demand at each hour can be reduced / increased within a proportional limit α, as long as the daily consumption does not change

10 Benefits for European generation / transmission system Cost savings ( bn/year) α=1% α=5% α=10% α=20% α=50% α=1% α=5% α=10% α=20% α=50% 30% RES 60% RES G CAPEX T/I CAPEX OPEX

11 Flexible industrial consumer market model Quantification of system benefits Operational constraints of flexible industrial consumer Objective function: Minimise overall electricity cost of flexible industrial consumer Prices of energy, balancing and capacity services Energy procured by the consumer in the energy market Volume of balancing services offered by the consumer Peak demand of consumer in the examined horizon Case study: Steel foundry with actual yearly demand profile

12 Benefits for flexible industrial consumer (α=10% scenario) Cost savings ( /year) Belgium France Germany Italy Spain UK Belgium France Germany Italy Spain UK 30% RES 60% RES Energy Balancing Generation Transmission Distribution

13 Regulatory barriers Business models Regulatory barriers Available tools Savings Energy costs 1 Flexible demand only Supplier price response Market price response 3 + contract with offsite VRE Long-term electricity supply 5 + contract with onsite VRE Long-term electricity supply Business model BE FR DE IT ES UK model I model II model III model IV model V Network and other regulated costs ToU network tariff Volumetric tariff response business case is viable in existing regulatory framework business case limited viability/restricted in current regulatory framework Revenues System services 2 Balancing provision and other services 4 Bilateral balancing provision business case impossible in existing regulatory framework

14 /category/project-results

15 Stochastic unit commitment model (SUCM) Aggregate wind power (p.u.) :00 01:00 02:00 03:00 04:00 05:00 06:00 07:00 08:00 09:00 Time (hrs) 10:00 11:00 12:00 13:00 14:00 15:00 16:00 Wind statistics wind forecast Demand net wind (MW) Time (hr) wind, demand, outage realisation Storage Capacity: 18GWh Rating: +/- 4GW Round-trip efficiency: 72% Technical and cost parameters (Rated output, MSG, Ramprates, Min up-/downtime, Response slope, Efficiency curve, Fuel costs, Start-up costs, Emissions) Wind uncertainty model demand forecast Aggregate demand (MW) startup 08:00 09:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 00:00 Available Time (hrs) Demand uncertainty model Online μ Δt λ Δt Unavailable Wind risk Demand risk Outage risk Demand + outages net wind (MW) Deterministic UC 50th percentile Reserve Time horizon (hr) Deterministic security targets Response Reserve Demand + outages net wind (MW) Scheduling model Stochastic UC Time horizon (hr) Stochastic security target Generation (MW) Time (hr) Dispatch, operating costs, CO2 emissions Wind Storage coal CCGT Nuclear online capacity Demand Outage model

16 Overall modelling approach Original Demand Future scenarios 2030 horizon G+T+D infrastructure assessment Period (h) Operational assessment Flexible Industrial demand - + System benefits of industrial demand response Sensitivity studies Generation, Transmission and Distribution Investment Optimisation Stochastic Optimisation Inflexible Industrial Demand

17 Share of industrial demand per country Share of industrial electricity consumption 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Albania Austria Belgium Bosnia and Herzegovina Bulgaria Croatia Czech Republic Denmark Estonia Finland France Germany Greece Hungary Ireland Italy Latvia Lithuania Luxembourg Netherlands Norway Poland Portugal Romania Serbia Slovakia Slovenia Spain Sweden Switzerland United Kingdom

18 Impact on utilisation of energy sources (60% RES scenario) Change in annual energy output (TWh) Increased utilisation of renewable generation Reduced utilisation of peaking units and storage -25 α=1% α=5% α=10% α=20% α=50% Wind Solar Storage OCGT Oil

19 Utilisation of industrial demand flexibility (α=20%, 60% RES scenario) 40% 35% 30% FID utilisation 25% 20% 15% 10% 5% 0% Albania Austria Belgium Bosnia and Herzegovina Bulgaria Croatia Czech Republic Denmark Estonia Finland France Germany Greece Hungary Ireland Italy Latvia Lithuania Luxembourg Netherlands Norway Poland Portugal Romania Serbia Slovakia Slovenia Spain Sweden Switzerland United Kingdom

20 Benefits for European distribution networks 80% 70% Greatest share of industrial load and low demand growth Cost savings (%) 60% 50% 40% 30% 20% Lowest share of industrial load and high demand growth 10% 0% Belgium France Germany Italy Spain UK α=1% α=5% α=10% α=20% α=50%

21 Policy recommendations by country Countries BE FR DE IT ES UK Winter Package Market access Aggregation fully allowed MARKET prop new dir. - Art 13 Direct access intraday/day-ahead markets MARKET prop new dir. - Art 15,17 Reserves open for DR Ancillary services Procurement to real-time Symmetric Products Minimum-bid size Distribution connected demand can participate MARKET prop new dir. - Art 32 Load-interruptibility competitive Tariffs Regulated charges in kwh Peak-coincident capacity component Extra charge for self-generation RES prop new dir. - Art. 21 Balancing Single or Double pricing S S S S/D D S VRE balancing responsible party On-site generation Abandon net-metering