Getting smarter about energy

Ofgem's announcement in July laid out a bold intent to enable and incentivise a transformation of how energy is generated and consumed here in the UK.

Smarter energy system will help people and businesses make more informed choices about when they use electricity and charge products such as electric vehicles.

Breaking down barriers preventing new technologies and business models from entering the energy market.

New technologies that help store and manage [renewable energy such as wind and solar] are emerging and the costs are falling.

In other words, stuff's going to start to happen so that in the near future we'll meet our energy demands by getting more value out of existing infrastructure and greater emphasis on managed decentralisation. It's a bold vision and gives greater legitimacy to the smart meter rollout than the promise of accurate bills and faster supplier switching.

If you squint it could almost look as if this was the plan all along.

Explicitly referred to is wide adoption of renewables and battery storage in our homes and businesses. I hope that "breaking down barriers" means financial incentives in the form of grants for the hardware involved or repayments offset by whatever I might feed in to the grid. No matter, it makes a lot of sense to have energy generation sited closer to its consumption.

Less obvious is a need to get smarter with how energy is consumed, essentially smart domestic Demand Side Response. I say 'smart' meaning that for it to be effective we're going to need intelligent consumption measurement and behind-the-meter appliance management. In short, don't leave the response bit up to me for even if I agree with domestic DSR in principle, it's not always going to be practical for me to participate. I might lapse into bad habits or just forget to switch stuff off. Wouldn't it be great if the bots took care of that so I don't have to even be aware that the whole process is happening at all?

A fundamental enabler of that, and one there'll inevitably be some resistance to, is widespread measurement of what's going through all those domestic meters. As it happens, proposals on mandatory domestic smart meter half hourly settlement are due from Ofgem in 2019 so it's probably worth keeping an eye on the Daily Mail around then.

So instead of me (or you) having to do much at all, I foresee an intelligent software agent acting on your behalf. It'd switch your supplier through a transactive energy exchange balanced with your contributions to domestic DSR, which may be a combination of tariff incentives and your own rule definitions. This requires some smartness behind the meter in context of overall network requirements, energy unit price and the needs of its peers behind the meter.

A transactive energy exchange would enable this model of consumption but it requires an adopted standard, transparency and trust to promote adoption. I fear that so much innovation potential would be unrealised if a monopoly organisation was anointed with the sole, central authority of managing such an infrastructure.

Thankfully there is some hope offered by blockchain based technologies backed by an industry adopted protocol for energy exchange. Blockchain for energy will be the subject of a series of posts to follow.