London’s low carbon energy future: what do you need to know? • Chair: Anne McElvoy, journalist & broadcaster • Ben Wilson, Director of Strategy & Regulation and CFO, UK Power Networks • Alastair Martin, Founder, Flexitricity • Bob Currie, Technical Director, Smart Grid Solutions • Alex Bettencourt, Managing Director, SmartGrid Canada Sidney Room Base London: smart grids panel discussion Ben Wilson Director of Strategy & Regulation and CFO 21 June 2012 www.ukpowernetworks.co.uk 2012. UK Power Networks. All rights reserved UK Power Networks: c.30% of the UK 2012. UK Power Networks. All rights reserved Total % of Industry End Customers Millions 8.0 28% Service Area km² 29,165 12% Underground Network km 134,767 29% Overhead Network km 47,391 15% Energy Distributed TWh 89.4 28% Peak Demand MW 16,229 N/A New Connections 130,768 35% 5 Our vision To be: And achieve upper third performance by 2013/14 2012. UK Power Networks. All rights reserved 6 Uncertain times in the UK utility sector Significant capex required in UK utility sector • high risk to gas and electricity security of supply in 5 – 10 years 200 (£bn) • unprecedented levels of investment required (up to £200bn) Total: 148.9 150 10.4 • wholesale price signals are inadequate 60.0 100 Key themes: 200.0 45.0 50 110.0 • high retail prices are increasingly unaffordable 5.0 14.0 14.5 0 'Top down' Ofgem estimate 'Bottom up' total of visible capex Networks – Ofgem price controls Networks – ENSG Offshore wind EMR estimate of electricity investment requirements Networks – National Grid New nuclear New CCGTs 12.3GW 2012. UK Power Networks. All rights reserved 4 A different world by 2030 2030 forecast East London South East UKPN total Solar PV installation 418k 135k 240k 793k 869MW 0 257MW 1,126MW Heat pumps (% of house with heat pump) 625k (19%) 172k (8%) 334k (16%) 1,131k Plugged in electric vehicles 545k 227k 349k 1,122k Onshore wind 2012. UK Power Networks. All rights reserved 8 Our strategic response • UK Government has clear policy objectives for the transition to a low carbon economy – we are actively supporting those objectives by enabling the transition Present DNO Non-flexible demand Non-flexible DG Possible Future DSO Non-regulated Technical Aggregation Commercial Aggregation Demand Response DG Contracts Network Storage Storage White Goods Cooling Heat EVs 2012. UK Power Networks. All rights reserved Enabling Infrastructure Dispatchable Resources Ancillary Services Flexible Demand 9 The benefit of optimisation (system level) Optimised EV and HP operation Non-optimised EV and HP operation 120 100 100 80 80 EV charging 60 HP demand 40 Original demand HP demand 40 23:00 22:00 21:00 20:00 19:00 18:00 17:00 16:00 15:00 14:00 13:00 12:00 11:00 10:00 09:00 08:00 07:00 06:00 05:00 04:00 03:00 02:00 0 01:00 0 00:00 20 Non-optimised heating / charging cycle EV charging 60 20 Time 78 GW Original demand 00:00 01:00 02:00 03:00 04:00 05:00 06:00 07:00 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 23:00 117 GW Demand (GW) Demand (GW) 120 Time Optimised heating / charging cycle Note: optimised operation highly dependent on storage Source: ENA / SEDG 2012. UK Power Networks. All rights reserved 10 Dealing with change A cultural and organisation challenge for network utilities • Twenty years of BAU with falling costs The macro environment is hard to predict even in the short term • Low carbon technologies • Economic climate The unbundled UK industry structure adds complexity • For the utilities • For the customer 2012. UK Power Networks. All rights reserved 11 London’s low carbon energy future: what do you need to know? Alastair Martin, Founder, Flexitricity Sidney Room London’s low carbon energy future: what do you need to know? Bob Currie, Technical Director, Smart Grid Solutions Sidney Room London’s low carbon energy future: what do you need to know? Alex Bettencourt, Managing Director, SmartGrid Canada Sidney Room