The Next Generation Energy System

Power Ledger
Jul 21, 2017 · 2 min read

There’s been plenty of conjecture about the future of the energy system. What kind of system will prevail? Microgrids? Nanogrids? Stand-alone systems? Old school centralized dispatch models? One thing is certain, we’re going through the fastest evolution the energy system has experienced in the last 100 years in the back of technological advances in distributed energy resources but one thing will remain the same; it’s still a system.

We’ll still (at least for the next 50 years) need to maintain the physical connection between generators and consumers. We’ll still need a network. We’ll need a drastic rethink on how we use it and how we pay for it but for the network it’s an evolution — not an extinction event.

Opposition towards embedded networks and microgrids pre-suppose that the existing network can’t provide opportunities for the development of dynamic micro-grids and dynamic distributed markets.

Let’s be honest though, no proponent of microgrids (none that actually understands the industry) is suggesting duplicating network assets. To suggest duplicating or replacing the existing network belies a failure to grasp how the energy system works.

Energy markets only deal with one component of the price of electricity supply — energy. In many systems this isn’t even the major component of the cost stack.

The network and the way regulation forces us to price it, is in many jurisdictions, the lion’s share of the cost of electricity supply.

Microgrids and distributed markets that allow consumers to access energy supplies from distributed sources at prices that reflect the value of the network assets deployed in the provision of those supplies, absolutely are the future.

A market/transactive mechanism that allows for the fair allocation of value to each of the participants in that exchange is a key requirement for this future state to arise without the destruction of value or the (too dumb to happen) duplication of existing assets.

That’s not the end of it though… pricing ancillary services, redundancy and a range of other functions that are required to maintain a secure, reliable and stable power supply also need to be considered.

It’s why the future of energy supplies is going to be a blend of new technologies and well-developed know how.

Like I said, it’s an evolution not an extinction event.

Written by David Martin — Managing Director & Co-founder of Power Ledger

Power Ledger

Power Ledger is a fast growing tech startup that has developed a world-first blockchain enabled energy trading platform.

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Power Ledger

Written by

World-first blockchain enabled energy trading platform. See more at https://powerledger.io/

Power Ledger

Power Ledger is a fast growing tech startup that has developed a world-first blockchain enabled energy trading platform.

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