What does Energy System Integration involve and what value does it bring?

Energy Systems Integration (ESI) is the process of coordinating the operation and planning of energy systems across multiple pathways and/or geographical scales to deliver reliable, cost-effective energy services with minimal impact on the environment.

Energy systems have evolved from individual systems with little or no dependencies into a complex set of integrated systems at scales that include customers, cities, and regions. This evolution has been driven by political, economic, and environmental objectives. As we try to meet the globally recognised imperative to reduce carbon emissions through the deployment of large renewable energy capacities while also maintaining reliability and competiveness, flexible energy systems are required. This flexibility can be attained through integrating various systems: by physically linking energy vectors, namely electricity, thermal, and fuels; by coordinating these vectors across other infrastructures, namely water, data, and transport; by institutionally coordinating energy markets; and, spatially, by increasing market footprint with granularity all the way down to the customer level (Figure 1).

 

Figure 1:  Energy Systems Integration

Source: National Renewable Energy Laboratory (NREL)

 

ESI is a multidisciplinary area ranging from science, engineering, and technology to policy, economics, regulation, and human behaviour. It is this focus simultaneously on breadth and depth that makes ESI such a challenging and exciting area.

ESI is one of several global social and engineering trends that will shape the solutions to the key challenges of the next decades: resource stress, climate change, megacities, urbanisation, cybersecurity, and infrastructure resilience. ESI is an umbrella concept that encompasses activities tackled in the context of smart grids (grid modernisation) and smart cities. However, these two approaches are more limited, with one focused on a single energy vector (electricity) and the other limited in geographical scale to a city — so they may miss important opportunities that can arise by considering all energy vectors and all scales.

The value of ESI is in coordinating how energy systems produce and deliver energy in all forms to reach reliable, economic, and or environmental goals at appropriate scales. Analysis and design of integrated energy systems can inform policymakers and industry on the best strategies to accomplish these goals.

What are the principal objectives of the European Energy Research Alliance, Joint Programme on Energy Systems Integration and the International Institute for Energy Systems Integration?

The importance of ESI is being recognised globally. Most significantly, ESI is a central theme running through the European Commission’s Strategic Energy Technology Plan (SET-Plan) Integrated Roadmap. It is also a central theme of the Clean Energy Ministerial and a major research theme with the U.S. Department of Energy national laboratory complex.

In February 2014 the US Department of Energy, National Renewable Energy Laboratory and Pacific Northwest National Laboratory co-hosted an invitation only workshop on ESI in Washington DC. There were 40 senior level attendees with 29 from the US, 10 from Europe and one from China. The workshop was designed to validate the importance of ESI as an emerging interdisciplinary scientific area and gauge the appetite for the establishment of an institute — the International Institute for Energy Systems Integration (iiESI). It was agreed by all participants that ESI is an important and emerging area and that forming an organisation such as iiESI was very positive and timely. The role and value of iiESI in fostering international collaboration, stimulating the sharing of knowledge and providing independent analysis was recognised by all. The independence of iiESI was seen as a fundamental characteristic, in particular with respect to valuing of particular technologies/solutions deployed in the energy system. iiESI as a formal organisation came into being in July 2016 as a global institute aimed at tackling the challenges of energy systems integration through global collaboration and education. Formalising iiESI as a global, member-driven organisation of leading ESI scholars and practitioners provides a structure for leveraging each other’s experiences and expertise, coordinating research agendas, and sharing best practices from around the world. The establishment of a formal institute will allow the group to expand and grow to meet the changing needs of the ESI community.

There is also a new European Energy Research Alliance (EERA) Joint Programme (JP) in ESI. An EERA JP is created by interested organisations that define a joint research agenda for a topic included in the SET-Plan. EERA JPs coordinate research based on the participating institutions own resources. In addition, the JP can obtain supplementary funding from national or EU sources. The aim is to gradually increase the amount of dedicated funding to the JPs. This will allow a JP to widen and deepen coordination. EERA JP ESI seeks to bring together research strengths across Europe to optimise our energy system, in particular by benefiting from the synergies between heating, cooling, electricity, renewable energy and fuel pathways at all scales. The energy elements of the water and transport system are also included, as is the enabling data and control network that enables the optimisation. The EERA JP ESI is designed to develop the technical and economic framework that government and industries will need to build the future efficient and sustainable European energy system.

What are the main ESI research challenges and how can they be overcome?

In March 2015, Imperial College London hosted an iiESI workshop, on ESI Research Challenges. This was attended by 38 experts from Europe, USA, Africa, Asia, Russia and Australia. The disciplines represented ranged from Engineering, Economics, Social Sciences, Mathematics and Physics, and industry was also represented. Not surprisingly one of the main outcomes of the workshop was the “need to combine economic, social, and political perspectives with engineering knowledge”. The need for education and dissemination featured strongly. In trying to identify research challenges however, the need for clear definitions of ESI and of “optimality” in an integrated energy system was apparent. There was little or no consensus on the optimality issue despite some follow up teleconferences and email exchanges.

Each energy system will approach ESI from a different starting point (e.g., an urban area in the developed world will have a different approach compared to a rural area in the developing world). It is crucial to define the geographical scope as well as the components, the boundaries, and the influence of the surroundings. For example, renewable integration is the driving force of ESI in many regions, but not all. In some regions, the main drivers are increased combined heat and power (CHP), increased efficiency, a shift from coal generation to natural gas, or simply electrification. Different incentives, decision-making processes, and access to capital due to location or scale will result in very different energy systems and approaches to ESI (e.g., a government can invest in high-voltage transmission, while individuals will not). As each energy system develops, it will be necessary to constantly re-evaluate the system in order to assess how it is best coordinated.

Developing coordinated systems through ESI analysis requires a proper understanding of the different actors involved, along with their motivations, their incentives, and the information they have access to. From a whole-system perspective, the actors in each energy domain tend to act on the information they have in ways that maximise benefits for their domain, but not for the entire energy system. For example, each user consumes based on their own requirements, each market values certain financial outcomes, and each government serves its own social or political motivations — but there may be no coordination across these domains to determine the best option for all actors involved. Poor outcomes can potentially arise from this lack of information and/or coordination, and may not be monetary in nature; a poorly executed energy transition could result in energy systems that lack technical integrity, social equity, and/or political acceptability.

The considerations that govern ESI are numerous and complex, and the outcomes and their value can be difficult to define. One of the first steps to determine this value is to define a set of robust metrics spanning the engineering and social sciences (e.g., financial impacts, emissions costs, resiliency, public health considerations, social utility, etc.) to measure and highlight the various benefits. Any set of definitions or metrics will have to be flexible enough to accommodate a wide range of circumstances. Metrics also need to be simple enough to allow for an overall holistic understanding of how the different aspects interact.

The main outcome of the London Workshop is the need for the global research community to adopt a common and clearly understood common language and consensus on the scope of the ESI. This is needed before a detailed interdisciplinary research roadmap for ESI can be articulated with confidence.

Because ESI is a broad topic that includes all types of energy sources and end-use applications, it is helpful to categorise examples of ESI into a few areas. Here we provide several examples of ESI that have been organised into three “opportunity areas”: streamline, synergise, and empower.

Streamline refers to improvements made within the existing energy system by restructuring, reorganising, and modernising current energy systems through institutional levers (i.e., policies, regulations, and markets) or investment in infrastructure. Increasing the flexibility of energy end use has potential system-wide benefits and could create new markets for products and services. However, capturing these benefits will require proper regulatory and market structures, new operational and planning paradigms, physical energy network characteristics, an integrated communications system, and suitably flexible end-use products. Many of these are currently lacking in the existing energy system and require a system-wide understanding to deliver pragmatic and sustainable solutions. Developing more integrated energy system-wide policies will enable better management of uncertainties.

More integrated energy networks and proper functioning real-time locational markets will reward capacity and flexibility. In addition, the removal of institutional barriers between distribution and transmission systems will allow better integration of distributed resources and facilitate regional integration. By providing standardised requirements, updated interconnection and interoperability standards and grid codes will streamline the energy sector.

Investment in the appropriate infrastructure within the integrated energy system will improve flexibility. Expansion of the electrical transmission grid will enable flexibility by aggregation across scales. Pipeline infrastructure is required to increase the penetration of bio and/or synthetic fuels. Investment in data infrastructure will enable consumers to more fully participate in the energy system and will improve energy network operations through forecasting and analytics.

Synergise describes ESI solutions that connect energy systems between energy domains and across spatial scales to take advantage of benefits in efficiency and performance. To date, the coupling of heat and electricity sectors has focused on the supply side (e.g., CHP) for fuel-saving purposes. However, at the system level, its inherent inflexibility can lead to sub-optimal overall system performance. A good example of this is wind curtailment in China, which is in part due to the inability of physically inflexible CHP plants to reduce electricity production while providing heat. ESI solutions that integrate heat storage into the CHP plant are being developed and indicate a shift from the supply side to the demand side (e.g., electrical heating of water, thermal storage in buffers and heat pumps). It is possible to capitalise on “virtual storage” where the flexibility in one part of the system (e.g., heat, transport, water, etc.) can be integrated with, for example, the electricity system, and used in a similar manner to electricity storage. This virtual storage can be significantly cheaper than dedicated storage, as it does not require large capital investment — but it does require a more integrated energy system. Demand management (e.g., controlling heating and cooling loads) technologies currently being deployed and developed are in part leveraging this virtual storage. However, ESI proposes that it is at a grand scale where fuel, thermal, water, and transport systems will be systematically planned, designed, and operated as flexible “virtual storage” resources for the electricity grid (and vice versa). There is also the potential to use the natural gas fuel grid to create energy storage through the “power-to-gas” concept.

Empower refers to ESI actions that include the consumer, whether through their investment decisions, their active participation, or their decisions to shift energy modes. Investments in energy efficiency are increasingly recognised as a cost-effective way to reduce energy demand and can lead to system-wide benefits that include upstream capital and operational savings. From an overall energy system point of view, energy efficiency at the level of an individual building may be in conflict with the flexibility that the demand side can provide to the grid. Energy efficiency improvements or targets also contribute to broader social and policy goals, notably macro-economic efficiency, industrial productivity, public budget balance, security of supply, and health benefits. This building-level investment needs to be made by the consumer. The formerly totally separated sectors of transport and electricity may become more integrated through plug-in electric (hybrid) vehicles and car batteries, but the consumer needs to accept this mode of transport. The potential in some regions for thermal grids has been raised, but questions remain as to how large they should be, how best to integrate them into the electricity grid, and, importantly, how consumer requirements will be ensured and whether consumers will accept them.

What is the role and main requirements of modelling in ESI?

Modelling plays a critical role in ESI research. Modelling is a means, not a goal in itself.

ESI is most valuable at the physical, institutional, and spatial interfaces, where there are interactions and new challenges and opportunities for research, demonstration, and deployment to reap its commercial and societal benefits. Therefore these interactions must be understood, quantified, analysed and then solutions designed and deployed. As the systems are complex, typically distributed with physical, economic and regulatory aspects, it is only possible to investigate them effectively and at reasonable cost by using good models. These models need to focus on the interfaces and will need to represent all major energy producing and consuming sectors with sufficient temporal and geographical granularity to be able to truly represent the ESI challenges and opportunities. Of particular importance is uncertainty in operations and in investment time scale, which needs to be captured. The need for high quality data cannot be over emphasised. Models are only as good as the data that is used to tune model parameters, validate models, develop scenarios and input data sets etc.

These models allow us to address unanticipated feedbacks in the system, identify efficient strategies, evaluate possible market design and policies, etc. Modelling is needed to understand how to achieve cost effective integration of energy sectors, what are the most promising new pathways and technologies and how the system performance may change under different scenarios and policies. Modelling therefore needs to simulate the physical system as well as the energy market, regulatory framework, underlying uncertainty in weather and longer-term resources and all the way to consumer behaviour, and how the actors’ decisions (operational and investment decisions) affect the performance of the physical system, and how regulation affects the actors’ decisions.

An extremely wide set of diverse models do exist. However, focus typically is on sectors and energy carriers, individually. Overall energy sector (or economy wide) models exist, but often lack technical detail, crucial to account for the variability of renewable energy sources such as wind and solar photovoltaic. The scope of ESI models needs to be larger than that of traditional models. The ideal model would include all the above-mentioned dimensions, the physics as well as the market, but this is neither feasible nor practical. As a result, the challenge is to develop a suite of models than can be used together. Preferably this should be made in a way that enables much better co-operation between model developers and users across the globe. Well-defined interfaces between models, open source code and high quality open source data would help to avoid duplicate effort. Different types of models are needed for different questions: simulation and optimisation, short term and long term, physical and market models.