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Facilitating Microscale Distributed Generation in New Zealand. Alister Gardiner. Prepared for: NERI Energy Conference, Massey Date: July 07. Slide Overview Headings: Blue Arial 2 8 pt Bold Subheading: Green Arial 2 4 pt Bold Text can be added by overtyping the current text. - PowerPoint PPT Presentation
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Facilitating Microscale Distributed Generation in New Zealand
Prepared for: NERI Energy Conference, Massey Date:July 07
Alister Gardiner
2
Overview
Drivers for change The role of Government Definitions - DG and microgrids Network design issues – technical, market Current status – a level playing field? Facilitation framework – technical, market design What I would like to see happen here
3
Drivers For Change
Delivery of energy services faces new challenges: Consequences of environmental damage Energy security
Contributing factors Continued growth in demand Dwindling traditional energy resources Political instability Competition for resource use Wellbeing and economic competitiveness Environmental awareness and sustainability The digital age requires higher quality and security
4
Drivers For Change
The requirements translate to a need for: Higher StU efficiency (not just demand side) Lower overall carbon emissions
Existing infrastructures have served well but will need to be adapted for the future:
Market liberalisation and customer choice Changing commercial frameworks and removal of barriers Technological advances and disruptive technologies End of life replacement and upgrade costs New resources and localities
Distributed generation can contribute to these goals
5
Government Role
Electrical energy objective: to ensure that electricity is produced and delivered to all classes of
consumer in an efficient, fair, reliable, and environmentally sustainable manner and to promote and facilitate the efficient use of energy
Distributed generation objective (GPS) To facilitate the use of distributed generation by ensuring that it does not
face undue barriers in connecting to lines
The government is responsible for a sector framework that delivers these objectives
“Electricity” or “electricity services”?
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Distributed Generation
7
MicroGenerationGeneral customers can generate from “behind the meter”
Intermittent renewable energy Firm Combined Heat and Power (CHP) ><10kW?
Potentially a substantial increase in system complexity
Conversion device
Reduced losses
Distributed Resources including
wind, solar, battery storage, fuels
Surplus electricity for other network
customers
M
8
MicroGeneration Through weight of numbers MicroDG could deliver a network
transformation
SUPPLY-SIDE DRIVEN BY BUSINESS
DEMAND-SIDE DRIVEN BY CUSTOMERS
NEW TECHNOLOGY INITIATED
OPPORTUNITY INITIATED
Number of Sites
Capacity of Site
LARGE
100MW
MEDIUM
10MW
SMALL
1MW
MINI
100kW
MICRO
ENERGY RETAIL
GENERATION
TRANSMISSION
DISTRIBUTION
INDUSTRIAL
COMMERCIAL
COMMUNITIES
DOMESTIC
• Large scale DG is supply side / business driven
• Small scale DG will be demand side driven, but will be influenced by supply side strategies
• A market framework that recognises the value of the full value of agregated microDG is desirable
BAU
Network Transformational
9
MicroGrids
“Smart Grids” is a new concept for electricity networks, needed to meet the challenges of the 21st century and fulfil the expectations of society
(European Commission Directorate General for Research http://www.eurosfaire.prd.fr/7pc/doc/1144859476_smartgrids_en_etp_2006.pdf
)
MicroEnergy technologies and the MicroGrid are key
components of the Smart Grid concept
10
MicroGrids
What is a microgrid?
A power network that operates at the community level, including the integration of small electricity sources,
energy storage, and controllable loads.
Includes a wide range of sources including PV, wind, fuel cells, etc. and loads operating as a single aggregated generator or load
Can operate as a net source of power, or as ancillary services supporting the network.
Unique feature – generally connected to the greater distribution network, but can automatically transfer to islanded mode, and also resynchronise as required
11
MicroGrids
“Behind the meter” customer-generators Each can import shortfall and export surplus (to next door?)
A disruptive technology? New regulatory framework? – central supply no longer dominates Autonomous, self healing systems?
~~
Centralised Generation
Transmission
Distribution
M M M
M M M
~
Micro-generationExample of a Microgrid connected to the existing Distribution System Community Microgrid
Other network feeders
2-way power flow
fuel based CHP
1-way power flow
Conventional Distribution
~PV, wind, hydro
12
MicroGrids
The value of the network - ADMD capacity reduction
If individual house peaks are 16kW The 100 house+ community per house peak is ~ 4kW The network provides substantial value by reducing the supply
capacity requirement
Who should pay for the cost of the network? The consumer - not the generator A customer-generator who makes a reduced demand on
network capacity should be rewarded with lower network costs
# of Houses 1 5 20 100
Ratio of MD 1 0.62 0.34 0.24
13
MicroGrid OptionsIntermittent local generation - Network dependent
Aggregated passive
generation
Network provides power balancing and
ancillary services (voltage, frequency,
etc.)
Firm local generation - Network independent: capable of islanded operation
Microgrid environment
Aggregated smart
generation
Microgrid can provide power balancing and
ancillary services (voltage, frequency,
etc.)
Microgrid environment
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Public Good Outcomes
Big improvement in supply efficiency Line losses reduced From <40% central generation to >80% CHP
Reduction in GHG emissions Many local energy resources are renewable Much less
fuel is used
Thermal resources conserved the rate of usage could be halved
Increased network resilience Higher reliability and power quality are possible
16
Network Design Issues
Central generation Energy Firm Capacity and power quality
Delivery High T&D infrastructure costs One way power flow Large scale wholesale market
Distributed generation Energy Capacity???
Delivery Low infrastructure costs Low losses 2 way power flow Small scale wholesale market???
Customer-generator General customer pays for
metered energy and an estimated share of various ancillary services (firm capacity, power quality, reliability, etc.)
If also a generator, should be
rewarded for both types of services supplied to the network
Offers a new paradigm in demand response/participation
17
Network Design Issues
Two areas to be addressed in a regulatory framework
Technical design Market design
Network integration can be enhanced by clear signals to device developers that
Encourage desirable network characteristics
Encourage public good benefits
Technical Most generic issues are
understood for low penetration levels
Inverter systems offer a trouble free standardised interface
System changes needed for high penetration levels
Market Dominated by centralised
wholesale market thinking New approach needed Transformational - must be
government led
Integration of community distributed energy solutions (IDES)
18
Current DG Status
Technical 2003 MED discussion paper proposed <10kW/40,000kWh category Sep 2006 draft regulations released for comment Jul 2007 - still no specific regulations for microgeneration
Market EC - Proposed model contract, no minimum price
Barriers? 4 sets of “consents” potentially required
Lines company – technical Retailer – purchase agreement Regional council – resource consent City/County Council – building permit
Many other “market entry” barriers
Leading to a more sustainable energy system
19
What Would I Like to See in NZ?
Technical: <10kW/40,000kWh is a good start but Simplify the application procedure and detail Mandate a standard “minimum certfication spec.” which Lines Cos
must accept, eg AS4777 plus any others required A new very small class of net metered microgeneration
(<5,000kWh/yr?) which is non-notifiable if it meets proscribed standards (ie treated as an appliance)
Market: Mandate a minimum payment /kWh exported which includes a 2 rate
option for on/off peak reward (feed-in tariff concept) On peak payment to include avoided GXP and line costs,
transmission and line upgrade costs based on asset management plans
Leading to a more sustainable energy system
20
Measurement of Capacity Value A simple method for metering average capacity support
provided by general customer-generators
Integration of community distributed energy solutions (IDES)
Existing Revenue Meter(s): As required by energy retailer
kWhExisting
customer loads
kWh
Distribution System connection
Capacity Meter:Two Register Meter with reverse stop, connected as Export
Distributed Generation
On-pk/ off-pk register switch from lines company
21
What Would I Like to See in NZ?
PCE “Get Smart, Think Small” report Recommendation 1: That the Minister of Energy, as part of the New Zealand
Energy Strategy, develops a specific local energy work programme for New Zealand that
Endorses the concept of local energy Identifies contributions LE could make Set short, med long term uptake targets Sets our govt roles and responsibilities Provides a framework (for action)
There are 6 comprehensive recommendations
IE – the government takes a leadership role in facilitating the introduction of these systems
22
Micro Distributed Energy Potential transformation of the Electricity Supply
Infrastructure through microgeneration and microgrids Strategy:
Central generation increasingly supplies large-scale users MicroDE initially provides supply to small owner-generators at the end
of the network Eventual penetration of customer microgeneration into urban areas
Management of microDG should be through a national regulatory framework and commercial pricing strategies – eg as for hot water load control
The network is still needed for this scenario – it provides load diversity, for which customers must continue to pay (but not the generators as well!)
Significant improvements in GHG reduction and energy efficiency are possible if this technology can be delivered
Integration of microscale energy systems
23
Micro Distributed Energy New Zealand business opportunities
Supply-demand side interaction Paradigm shift in thinking
New network technical issues 2 way power flow protection
New network management issues Capacity and despatch
New products Materials and components Systems and control
New market mechanisms A comprehensive RD&D programme is needed
Feasibility and benefits Systems and technology research “Light house” community pilots to evaluate techologies and mechanisms
Integration of microscale energy systems
24
Regulatory Framework Design
What might happen if the framework is inadequate? Microgenerators may take the baseload residential demand microCHP may destroy the ability to control water heating load Residential network economics may worsen Gas distributors may get rich
What could happen under the right framework? Network capacity support from general customers Improved demand factor (more cost-effective networks) Also kVAr voltage support and other ancillary services (improved
power quality and reliability) Increased network efficiency (lower losses) Improved supply resilience (segmenting and self healing
networks)