Energy Industry: Development Opportunities Through the Technologies
To date, the energy industry is experiencing an acute shortage of modernization tools. Existing energy systems are long outdated, the development of the sphere is proceeding at an extremely slow pace, which as a result leads the industry not only to physical but, above all, to obsolescence.
For this reason, the relevance of the energy system development, which will be based on innovative solutions and advanced technologies, is undeniable. Awareness of the need for innovations in this industry will lead to an increase in energy capacities, as well as to the new types of power plants’ creation and electricity distribution models. It is worth noting that many countries are already actively introducing intelligent networks (INs), called Smart Grid, into their energy systems. Undoubtedly, many experts are sure that such steps will be on the podium of energy trends and in this article, we will consider technologies and new approaches to improving the global energy sphere.
Smart Grid technology
Most countries have similar energy systems: they are centralized and consist of large power plants that already supply electricity to consumers through electricity networks. With such a system, there is a drawback — not all power plants are able to maintain stable operation, upsetting the balance between production and consumers, which leads to frequency fluctuations. Sudden changes in the frequency of electric currents often cause an accident. These cases can be avoided by introducing Smart Grid technology, which is designed to automatically searching and eliminating vulnerabilities in power networks by making changes to the network diagrams and characteristics, minimizing the risks of accidents and losses from them.
Thus, two main functions of intelligent networks can be defined, they are automatic transmission and electricity distribution. IN shortens the path of energy to the end-consumer, taking this resource from various sources, such as, for example, wind or the sun, and turning it into a final product.
The digitalization of this network provides the ability to control power consumption with maximum accuracy and high efficiency.
The introduction of innovative approaches through the prism of Smart Grid technology can provide the industry with the following promising solutions: thanks to the interaction of all network elements, it is possible to exchange data between them in real-time, which is a key factor for the stable and profitable operation of a common electric grid.
Intelligent networks have already gone beyond the concept and examples of their work can be seen in China, the USA, Japan, and some EU countries. However, the implemented solutions showed the weaknesses of this technology:
- lack of a clear approach to resource control;
- cases of electricity losses;
- lack of specialists.
Virtual power plant
Another concept of the future energy sector is the implementation of virtual power plants (VPP).
This solution can contribute to:
- process optimization;
- stabilization of power supply;
- the flexibility of all participants’ work in the power system;
- integration of new solutions.
Virtual power plants can be called a smart distributed generation control system, as this concept involves the interaction of several energy sources, for example, generators and consumers, with distributed generation mechanisms. Moreover, virtual power plants can serve as a balancing tool for the entire system. Their functionality includes the ability to regulate network surges and unstable operation of renewable energy sources. Virtual power plants can also act as a marketing lever of pressure to increase the popularity of an individual energy company, which through the introduction of new technologies will be able to attract more customers, guaranteeing them trouble-free operation and low fares.
It should be borne in mind that for the full functioning of the virtual power plant it is necessary to use a technological approach — ensuring work with the help of modernized energy metering systems, a secure communication infrastructure, including stable Internet connection and IoT sensors designed to collect telemetric data.
According to information published in the Markets and Markets report, even 3 years ago, the global VPP market was estimated at $193.4 million, while experts predict an increase to $709 million already in 2021.
The introduction of virtual power plants in the energy industry contributes to the goal when each of the participants in the entire system benefits from its use.
However, despite the advantages, the stumbling block to the global introduction of virtual power plants is the lack of readiness of the regulatory framework in many countries. Due to the fact that consumers in most countries can only purchase electricity from the state, which, in turn, buys resources from private suppliers, it is quite difficult to organize a distributed network.
The emergence of an improved energy system on a large scale is also hindered by the reluctance of governments to carry out global work on the introduction of additional technologies, which also require significant investment. Insufficient analytics of future benefits is a psychological springboard that officials need to overcome for the smart energy industry in the future.
The policy of decentralization
Moreover, many European countries, including Ukraine, decided on their future development course, which is based on decentralization principles.
In 2009, the EU Council adopted the Third Energy Package, which includes the liberalization of the gas and electricity markets. The main focus of the new legislation is the rejection of the energy suppliers’ monopoly. Thanks to this approach, competing companies appear on the market, which provokes the development of healthy competition between participants in this industry and contributes to the formation of a fair pricing policy.
It is worth highlighting Ukraine as a country that has recently taken steps towards modernizing the energy market. In 2017, the country’s supreme legislative body, the Verkhovna Rada, adopted the Law on the Electricity Market, which complies with the requirements of the Third Energy Package of the EU. Thus, an opportunity is provided for consumers to choose their own electricity suppliers, since there will be no monopolization in the market.
And already in July of this year, the largest industry representative, DTEK, laid the first brick in the work of the new electricity market, having held the country’s first exchange trading to sell electricity on the market a day in advance. The result was a 12% reduction in the cost of electricity at DTEK’s thermal power station when compared with the figures for the first half of 2019. DTEK, as an innovative mastodon of the Ukrainian energy sector, seeks to create such market conditions for its participants, where the work of each company will be focused on the development of the whole industry and attracting investments in it for its modernization.
Blockchain as one of the technological facets of the energy sector
Blockchain technology is a kind of tool for decentralized work with records (transactions). Despite the fact that the blockchain was originally developed for the financial sector, its popularity has attracted the attention of many developers who create applications that complement the basic functionality of the technology — decentralized storage of transaction data.
One of the powerful mechanisms integrated into the technology is the so-called smart contracts, which allow you to carry out actual transactions on a decentralized basis. Smart contracts operate on the basis of individually defined rules that provide an autonomous comparison of distributed suppliers and their potential customers.
The use of blockchain technology in the energy sector, according to many experts, is an integral part of the strategy to modernize the industry.
This technology provides the infrastructure for managing and processing valuable data, excluding mediation. It is worth paying attention to this aspect since it is the presence of intermediaries that complicate the processes and provokes an increase in transaction costs and, as a consequence, the cost of services/resources.
The use of blockchain technology in order to optimize existing processes in the energy sector should be considered through the prism of introducing certain apps that are able to completely control the path of electricity from the supplier to the consumer. Moreover, the blockchain will help in the analysis of data, indicating the peaks of network congestion and establishing secure communication between smart devices of the entire modernized power system.
Blockchain as economic infrastructure for the market of distributed generation and transmission of electricity
As described above, distributed energy allows consumers to control generation, thereby optimizing energy costs.
It is worth noting that today, distributed energy has several unresolved problems, such as, for example, ensuring a high level of reliability and balance of the entire system.
At this stage of the industry development, the resource is unevenly distributed among all participants in the system, which leads to the need to implement an effective mechanism for achieving consensus both between devices and between companies and end-users. As a result of this approach, the electricity market becomes a self-balancing mechanism with a complete absence of a monopoly, where each participant in the system is an integral part of it.
Moreover, the blockchain will protect the industry from the possible influence of individual large companies and it will also provide a safe environment for the further development of all technological innovations within the energy market.
Unmanned cars in Smart Grid
Decentralization of the energy sector may be applicable not only within the framework of providing electricity to individual consumers, but also be useful in the formation of a well-functioning energy market from entire cities.
At the beginning of the article, SmartGrid technology was already mentioned, which, by the way, is one of the key components of the SmartCity concept.
Intelligent management of energy flows will open up new opportunities for balancing the city’s energy network, as it will focus on providing charging stations.
On the other hand, a smart city is a city without overloaded traffic, with a perfectly functioning urban transport infrastructure, the energy system of which is a complex mechanism.
It is worth focusing on urban transport, because service stations are often located in places remote from their parking lots. At the same time, the parking area remains unused during the day when the vehicles are in shift and the service stations remain empty at night. In this case, it seems reasonable to combine the substation with the parking, which as a result will make it possible to create an interacting charging station that is capable of functioning in 24/7 mode.
In turn, I would like to mention a concept that demonstrates the possibility of interaction between machines without the human factor. The prototype of the 482.solutions blockchain solution development company, Robocharge, is a set of devices that, while providing services to each other, can pay for the provided service using the built-in cryptocurrency accounts. Thus, based on this concept, the creation of electric parking is possible without human intervention, in the case of unmanned vehicles.
If we consider the inter-machine interaction, it is necessary to pay attention to the V2V (Vehicle-to-Vehicle) technology, which will contribute to the safe use of unmanned vehicles. Thanks to the radio signals, information about the location of the car, its speed, as well as the direction can be got, then these data are transmitted to all vehicles around to observe all precautions. According to experts at the National Highway Traffic Safety Administration, V2V technology will reduce the number of crashes by 79%.
Another interesting fact is that the car of an average megalopolis resident is used at only 4% per day, the rest of the hours it expects his owner in parking lots, taking its place and not bringing any benefit to society. However, the electric car can be connected to the network, so it will become a battery for the city, bringing not only its contribution to supporting the electrical system but also the benefit of its owner. The owner of such an electric car has the opportunity to earn money during high network loads, providing a valuable resource to the urban energy market. At the same time, it is worthwhile to realize that during serious traffic, it will be necessary to use public transport, which will not only allow electric car owners to earn money but will also unload the urban electricity supply network.
This technology is called Vehicle to Grid (V2G) and it is already under testing. For example, the automaker Nissan introduced several projects showing that the owner of such a vehicle can earn up to 1300 euros per month.
In the future, it seems possible to use V2G technology for uninterrupted power supply of homes by connecting electric vehicles and hybrids. The benefits of this approach have already been explored by the US government, which is developing the V2G concept with Google.
Conclusion
The energy market is a huge industry that requires changes and technological modernization. Experts from other areas are joining together to develop such a large-scale sector as energy. For example, the largest energy holding DTEK has confirmed its intention to remain at the forefront of technological development, opening a new Innovation DTEK space.
Representatives of the 482.solutions team joined the DTEK Innovation Days event, which brought together people who believe in transforming the industry through innovations. The event presented innovative technological solutions that can not only increase the efficiency of the production processes of the holding but also change our future, which has already come.
