How far is the future away?
We are at the beginning of a new era; a decade with more expected changes in the utility landscape than in the past 80 years. Decentralized generation; Decentralized Energy Resources (DER), Demand side management, peak shaving, customer involvement, feed in at Low Voltage, Electrical Vehicles, renewables, such solar and wind, and much more all expected to happen. The latest Clean Energy directive from European commission drives the role of the consumer; decreases CO2, decentralizes renewables and requests support for the future microgrids.

While business cases vary by region, in all situations, the change is being driven by a mix of technical and economic reasons. One way is looking at is from two business angle drivers: Grid Modernization solutions and performance excellence. In the first case, the goal is to build a grid to cope with distributed energy resources, such as generation, storage or e.g. electric vehicles. The regulatory requirements, which in Europe are driven by European Commission, will enforce the DSO to implement a system to support the latest regulation and customer demands. New or improved technologies change the investment strategies; old business models need to be adjusted. Higher service levels are expected, while the impact on the dynamics of the LV are only known on a limited level.

Meanwhile, the DSO needs to increase the financial performance on assets and capital, and will look for new methodologies and tools, as well as implement best practices gained from pilot projects. The DSO has to plan investments with ROI models where many parameters are changing during the implementation process. Right now, the cost of local generation is in some countries, such as India, is similar to buying from the grid. The challenge of having the right vision, strategy, people, process and technology to match best in class will be a nightmare for DSO management teams. The key performance metrics will need to improve while there is a focus to optimize assets and business processes. This is all very challenging, like doing maintenance on a car which is driving.

And the reality is even worse. The utility must cope with many external parties who generate, store, sell and use energy. From a technical perspective, it is a new game, but from a settlement and administrative perspective, this is not a done deal. There are very few standard processes and protocols in place to implement this across the company, utility and end-users.

Right now, the traditional focus is on decreasing non-technical losses, increasing cash collections, implementing pre-paid, and perhaps decreasing peak load. However, the DSO will need its first insight in the real topology of the low-voltage (LV) grid including impact and dynamics of the customer usage. Load balancing being the first benefit. Thereafter, insight in voltage patterns, THD, and using the information collected, developing the logic to predict loads based on external variables, such as wind direction and sunshine. New algorithms need to create information from the vast amount of data. A three-layer architecture (end-device, transformer level, and central system) needs to be in place that can enable decision on what to handle at what level. It will not make sense, or is it possible, to collect all the data centrally, as there will not be enough time to respond to the changes in the LV grid. At the OSGP Workshop, some utilities will share their experiences and views. This is beneficial to peer utilities as there is a significant gap in experience and focus between utilities.

And of course, recently more articles and research cases are being published about security. More utilities are getting worried and start to understand that they did not take this as serious in their latest sourcing. In addition, some older systems are not capable of increasing security levels as required. In some situation, systems will be pulled out, long before they were planned, due to vulnerabilities which cannot be addressed. CFO’s and CEO’s will get the blame for not having done the right thing, but it is not easy to start with a vision how the world will look 5, 10, or 15 years from now. At European Utility Week, a special session on security is being hosted by the OSGP Alliance that will update utility staff on the latest insights in risk and how to address security questions. One key requirement for any investment that must now be considered: and the session will explore issues, such as can the system cope with security risks over its lifetime?

How to make choices for technologies, protocols, standards, if you know things will change. Are uitilies willing to accept that they cannot take advantage of innovation? Probably not, therefore there is another route that provides the ability to adopt new technologies as they become available, while taking advantage of the best performing, proven technology and standard (OSGP) today. The Open Smart Grid Protocol and the right architecture will provide the best of both worlds that can limit risk today and enable enhancements and improvements into the future.

Regulators can play a vital role and can lead the DSO in the right way. It should go hand in hand with the proper financials to support implementing a system which can fulfill these requirements. The DSO should source systems like smart meter solutions having in mind that the future has already started. Any investment now should be able to be part of the future grid, based on a three tier architecture, supporting a decentralized grid with extensive LV power management and control functionalities. The Utility CEO’s main objective today is to ensure there is a shared vision with all stakeholders that is driving the organization into the new world.

Mark B.M. Ossel (1955), Vice President NES, is focused on developing the Energy and Utility market for Networked Energy Services by extending the network of partners and growing the customer base. He is involved in AMR since 2001, when Echelon started with Enel (It) the world largest AMR project, and has been involved in most large scale deployments in Europe. He was selected in 2015 as one of top 40 most influential people in Europe by Metering International. Mark is also member of the board of OSGP Alliance, the international industry & utility user group publishing OSGP (Open Smart Grid Protocol), and involved in international standardization efforts. Active member in ETSI, various CEN /CENELEC Technical committees (TC13, TC57), ESMIG and member European Commission Steering Board Taskforce Smart Grid. (SGCG/M490). Mark has a background of more than 20 years in various management functions in the Information & Communication Technology market (Burroughs/Unisys), before he became involved in energy management, smart metering and Smart Grids in 2001.