Smart Grids ME 2010
Smart Grids ME highlighted technologies to improve energy efficiency
Inspired by the need to reduce carbon emissions, save money and improve customer service, the event highlighted technologies to improve the efficiency, functionality and flexibility of the current power infrastructure.
The Smart Grids Middle East 2010 conference brought together over 200 senior executives from the utility and power sectors and Government energy authorities.
It featured panel discussions and presentations about the smart grid from three perspectives: technological, commercial, and regulatory.
In response to the growing green building and smart city concepts in the Middle East, the conference highlighted technologies for a greener and more efficient future.
Sessions included how to build a smart grid city, technologies for intelligent buildings, smart metering and automated metering infrastructure.
“The Middle East is the ideal place to start an AMI or Smart Grid project,” said Dr Howard Scott, managing director, Cognyst International.
“The need to move utility plants to the next generation clearly exist. More importantly, the business case in the Middle East is probably more compelling than anywhere else in the world.”
His Excellency Saeed Mohammed Al Tayer, managing director and CEO, DEWA, said it has succeeded in reducing its electricity network losses and unaccounted-for water through network rehabilitation and more optimal network design, engineering, maintenance and procurement.
“Additionally, on our Smart Grids journey, we have interconnected our electricity grid with neighbouring utilities,” he said.
According to Pike Research, approximately $200 billion will be spent on smart grid projects by 2015.
The Smart Grid is a reality for nearly 8% of utilities in the world which have begun to implement smart grid projects, and an estimated 37% that are conducting experiments and pilot studies into smart grid projects.
Abu Dhabi utility tariffs
There are no plans to change the tariff structure for electricity and water in Abu Dhabi, in spite of a roll out of smart meters in the emirate that would enable variable tariffs, said the head of the Emirate’s regulatory body for the sector.
“The sector in Abu Dhabi is now virtually covered in smart meters. There is something like 600,000 smart meters installed for both water and electricity, that programme is almost complete,” said Nick Carter, director general of the Regulation & Supervision Bureau (RSB).
Smart meters make variable tariffs possible, as they give utilities providers almost real time information about consumption.
Carter added no tariff changes are being planned, and the Bureau is concentrating its efforts on raising awareness about the real cost of power and water amongst consumers. “For us, it is more about education,” he said.
From January, Abu Dhabi’s residents will receive bills that show the ‘waived cost’ or the amount by which electricity and water is being subsidised.
For UAE nationals, this can amount to 84% of the total cost, said the RSB. Nevertheless, observers believe that subsidies will eventually be scaled back, or that tariffs will be changed to discourage energy consumption during peak hours.
As utilities across the GCC are struggling to keep up with increasing demand, calls for “shaving the peak load” have become louder. As generation capacity has to match consumption, a lower peak demand would reduce the need to invest in new power projects.
Abu Dhabi currently has an installed generation capacity of 10,00MW according to a MEED estimate. In 2009, the Abu Dhabi Water and Electricity Company (ADWEC) estimated the peak load to be at 6,255MW, with demand during peak hours growing at a rate of 7% in the UAE.
While refusing to comment on near term tariff changes, Carter said the bureau is keen to promote the concept of nega-watts to reduce peak demand, with the emphasis being on lowering the electricity used for air conditioning.
The Nega-watts principle works by paying customers to not consume electricity instead of having the utilities to provide at a very high cost, said Carter.
“We’re extremely keen to look at the possibility of demand management though the disconnection of building management systems being programmed to disconnect A/C systems at maybe 80 to 90% through their duty cycle,” he added.
“Electronic systems integrated in communications systems would allow us the regulator to develop nega-watt type tariffs, which actually give people an incentive to reduce their A/C at just certain types.”
According to Julien Groues, vice-president, EMEA, Oracle Utilities, smart metering technology, will permit customers in the UAE to reduce consumption when demand is high and shift to off-peak hours.
“It will also reward building owners for investing in efficient on-site equipment and for keeping that equipment in good repair. Furthermore, it will help create ‘wise-use’ partnership between utilities and customers across the region,” he said.
Oracle is helping utilities support smart grid and smart meter implementations through its software applications, customer care and billing (CC&B) and meter data management (MDM) solutions.
These applications allow utilities to manage their front and back office to leverage the information from smart grids and smart meters. They are designed to manage exponential growth in data volumes.
Smart metering requires advanced meters that have a number of additional functions to traditional versions, such as real-time sensors, power outage notification, and power quality monitoring.
These functions enable the meters to accurately read consumption in real time, measure consumption over set time periods and can include the calculation of flexible energy tariffs.
This collected data is then communicated automatically via a network to a central location for monitoring and billing.
It is not just Dubai that is deploying the smart grid technology.
As reported in Saudi Arabia, the head of Saudi Electricity Company (SEC) announced that smart metering will have to be rolled out across the Kingdom before tariffs for households are increased.
In July last year, the state-owned power and water provider increased its tariffs to industrial and large commercial customers, and introduced variable tariffs to encourage the use of power outside of peak demand hours.
It is expected that for tariff increases to become applicable for private customers, who currently enjoy subsidised rates, smart metering pilot programmes, being rolled out in some cities will have to be extended to cover the entire country.
‘We don’t want the consumer to be faced with cost effective tariffs without giving them the tools to manage their consumption,’ said Ali Saleh Al Barrak, CEO and president, SEC.
He added that a number of pilot projects are currently in their final stages in the government quarter in Riyadh.
Demand in Saudi Arabia is set to rocket, with 55% energy consumed by domestic use and consumption per capita has doubled over the last 15 years.
“We are looking for more energy preservation by giving the tools for the consumers,” said Al Barrak.
With demand expected to reach 77,000 MW by 2020, according to company estimates, generation capacity needs to increase by 30,000 MW over the next decade.
Investment is estimated to reach around $40 billion which is needed for generation expansion, with a further $24 billion for expansion distribution, including the introduction of smart systems.
Techem Energy Services Middle East
According to Groues, from an IT perspective; to support smart grid and smart meter implementations, it is advised utilities use a MDM application to gather and manage consumption data from the network.
“This enables utilities to manage the additional data and to use its many processes such as forecasting to anticipate periods of high and low demand.
“This means utilities can manage their networks accordingly to improve customer service operations,” he said.
“Distribution management systems are also needed to detect and cure potential problems within the grid before an outage is caused, by isolating the problem and redirecting customers to alternative power sources,” he added.
“Finally, the region needs a single view of its customer because it has historically implemented a number of disparate systems. Therefore, Oracle is now providing utilities with a 360 degree view of customers to allow them to evaluate their requirements and activities to provide a more detailed and efficient service.”
Hans Altman, regional manager, Middle East & North Africa, Techem Energy Services Middle East, said the key area for smart metering should be on the metering and billing of cooling energy.
“Cooling energy accounts for over 60% of electricity generated in the region and this is the main consumer that needs regulations, incentives and technologies to have an impact on energy consumption,” he said.
But to be sustainable, the region needs to take more interest in renewable sources of energy. Again, smart meters are cited as a means of introducing such an approach. Currently 97% of UAE electricity is fuelled by carbon-producing natural gas. Abu Dhabi, however has announced that 7% of its energy will come from renewable sources by 2020.
A key renewable scenario that will be enabled by smart meters is that of the ‘prosumer’, added Groues. This allows the consumer to act as a producer by installing renewable production devices onsite, be it solar or wind power.
“Besides reducing consumption by making consumers partly self-sufficient, the key enabler is the provision of capacity to manage virtual power plants which represent the aggregated production of an area or class of prosumers,” he said.
“Another less obvious aspect derives from the provision of better forecasts enabled by smart meters. Having a more detailed consumption history clearly helps in defining more accurate and reliable forecasts, and having this capability will minimise the impact of the level of uncertainty of any renewable source.”
Typically, such a paradigmatic shift will face challenges. A key obstacle faced by utilities within the GCC is the problem of keeping networks cool in order for them to function at maximum capacity.
According to Groues, Oracle is helping its customers overcome such challenges through the deployment of distribution management systems. The solution can detect and cure potential problems within the grid before an outage is caused it does this by isolating the problem and redirecting customers to alternative power sources.
“I see three main challenges. Firstly, is the capital investment needed to achieve a saturated rollout. Secondly, resistance from powerful consumers to the potential dynamic pricing the AMI deployment will offer the utility and thirdly, many of the smart meter manufactures have proprietary systems,” said Stuart Russell, senior business development manager, Energy Middle East, Honeywell.
“This is a cause for concern by utilities and rightly so, the days of lock in technologies are past and manufactures need to share their technology for greater cooperation.”
These challenges, however, are set against fair billing for tenants, who pay for actual consumption.
While the concept of smart metering has not truly taken hold in the emirates, it is hoped that with each subsequent project that features the technology, it will act as a spur for further uptake.
“Whilst DEWA is beginning its rollout, other utilities within the region have made advances too.
“On the whole, smart meters allow utilities to offer innovative tariffs and services and therefore, once rolled out in a region there is often pressure for others to follow suit,” said Groues.