By Clarion Energy Content Directors

As countries move to decarbonize and adopt renewable energy, many are finding it difficult to do so cost-effectively due to fundamental limitations in solar and wind resources. For countries to fully decarbonize without breaking the bank, they must develop renewable energy carriers and build new zero-carbon energy supply chains, says Lux Research.

In the new report, “Evolution of Energy Networks: Decarbonizing the Global Energy Trade,” Lux Research examines renewable energy carriers as well as countries and companies developing them.

Lux evaluated the lifetime costs of 15 different renewable energy carriers from electricity, hydrogen, synthetic methane and ammonia to liquid organic hydrogen carriers (LOHCs), vanadium and aluminum.

Delivering energy via land-based infrastructure becomes expensive at long distances as a result of inefficiencies of powerlines and capital costs of pipelines. However, delivery via ship is much most cost-effective at long distances.

Lux’s analysis also found that across all renewable carriers, low-cost solar energy can be delivered to resource-constrained regions at 50% to 80% lower cost than generating solar locally.

Lux predicts the tipping point for deploying renewable energy import infrastructure will be in 2030, when imported electricity via new HVDC power lines becomes cheaper than low-carbon natural gas turbines. The next tipping point will occur in 2040, according to the report, when imported liquid hydrogen becomes cheaper than low-carbon stream methane reformation.

These predictions allow 10 years for companies to develop partnership and pilot projects to demonstrate such a transformative energy paradigm. Major companies like Kawasaki Heavy Industries, Mitsui & Co., Equinor, and Shell are already developing decarbonized energy trade routes in Europe, Japan and Southeast Asia.

Tim Grejtak, an analyst at Lux Research and the lead author of the report states that, “Countries representing $9 trillion of global GDP cannot meet their energy demands solely through domestic renewable energy production and will require the import of renewable energy from more resource-rich countries.”

“Our analysis shows the expanded buildout of AC and DC powerlines will be the most cost-effective way of importing low-cost solar energy from distant regions, though only up to roughly 1,000 km. At farther distances, other renewable energy carriers like synthetic fuels are less expensive. It’s important to note that imported energy costs can be competitive against other zero-carbon technologies, but no current energy carrier can offer costs low enough to completely replace liquid natural gas (LNG) or oil,” Grejtak adds.

Originally posted on POWERGRID International.

By Jeff Hamel

As the energy and IOT landscapes mature, there is an opportunity for utilities to expand existing demand response (DR) programs by forming third-party partnerships with distributed energy resource management systems (DERMS) providers. These companies are capable of managing a wide range of connected and distributed energy resources (DERs) for a more flexible grid and can deliver the resources that utilities need to more effectively engage with customers.

Even during times of great uncertainty, partnerships between utilities and DERMS providers can build on the success of existing utility DR programs to create better utility and customer outcomes for a healthier grid.

DR programs today

Many smart thermostat models are available on the market today at various price points, and users are interested in using these devices to participate in DR programs. According to a recent Parks Associates report, 42 percent of current smart thermostat owners would allow a utility to adjust their thermostat in order to save energy.

Utilities have successfully deployed DR programs alongside smart thermostat rebates for years, but these programs still only tap into a fraction of the program’s full potential. That said, it is clear that existing DR programs are making an impact and have saved a significant amount of energy for customers and the grid.

Utilities reported an enrolled DR capacity of 20.8 GW and a dispatched capacity of 12.3 GW per SEPA’s 2019 Utility Demand Response Market Snapshot. The report indicates that DR could deliver 200 GW of economically-feasible load potential in the U.S. by 2030, and new tools and technologies can help advance both mass market (residential and small business) and C&I programs.

Challenges of large-scale deployment

Most utility DR programs target a single customer class or grid asset, so despite proven customer interest and significant savings so far, utilities are still struggling to increase the scale of their DR programs and effectively boost customer participation.

There is precedent for broader, nationwide engagement. In 2017, 750,000 Nest thermostat owners participated in a nationwide DR event during the solar eclipse, which reduced demand on the energy grid by 700 MW, helping to offset the 5 percent of the solar energy lost nationwide during the eclipse—offering yet another proof point of customers’ appetite for participating in DR. Initiatives at this scale are nearly impossible for a single utility to deploy given the wholesale market structure, however, this is where DERMS partners really shine!

DERMS providers open new opportunities for next-level DR programs

Electric and gas utility partnerships with DERMS providers to leverage multiple asset types opens up and engages more customers to enroll—especially as the energy landscape continues its evolution.

The energy landscape now includes assets like energy storage, solar, EVs and smart thermostat-enabled DR. DERMS companies can help utilities effectively manage and leverage all of these assets to optimize grid performance by streamlining DR program enrollment and using a wide range of assets to deliver dispatchable DR to many different customer groups.

New software, which DERMS can help to deploy, enables utilities to leverage these various resources to create a portfolio of integrated DR programs. According to the same SEPA market report cited earlier, these programs provide more savings, appeal to more customers and offer more grid resources that can be called on more frequently, due to their flexibility, when compared to traditional DR programs.

In the age of online marketplaces, DERMS providers can also facilitate a modern shopping experience for customers to purchase hardware-based DERs. They can deliver personalized offerings by targeting groups like the low-income market, increasing the ability of these groups to obtain smart devices that ultimately save money and energy.

Resources like sophisticated online marketplaces help streamline product purchases, DR program enrollment and rebates within the checkout process to increase enrollment and deliver cost savings.

DERMS framework supports the utility industry

If utility leaders are open to partnering with DERMS providers, they will have the resources they need to integrate additional, maturing DERs onto the grid, which leads to more diverse portfolios that are better suited to meet our future energy needs. On the customer engagement side, DERMS can help utilities better connect with new and existing users who are drawn to the streamlined DR enrollment process, cost savings and upgraded online purchasing experiences.

DERMS providers have the ability to unlock the full potential of DR programs and tap into technologies that are already in place with existing utility programs. Through these partnerships, utilities will be able to manage demand with more flexibility and efficiency than ever before, while improving resilience and avoiding expensive infrastructure investments.

Originally posted by POWERGRID International.

By Jennifer Runyon

According to Edgard Capdevielle, CEO Nozomi Networks, remote access to critical assets could be putting utilities more at risk for a cyberattack than ever before.

It probably won’t come as a surprise to anyone who works on critical energy infrastructure that adding a layer of cybersecurity to the industrial network is not the same as adding cybersecurity to the traditional IT networks that protects our email servers and printers and the like.

So asking critical infrastructure workers to do their work remotely can be quite a radical proposition, said Nozomi Networks CEO Edgard Capdevielle in an interview.

“IT networks have always dealt with remote workers,” he said, but remote work “means something completely different for the industrial side of the house.”

Traditionally, the industrial network was only open to a few select employees who worked onsite. And most utilities believed that those industrial networks were safe and secure. “We didn’t monitor them because we thought they were disconnected and were never exposed,” he said.

But now with more people accessing the work they do remotely, that “attack surface” has been “expanded in a very significant and uncontrolled way,” he said.

Capdevielle explained that for many utilities, there is no way to granularly allow access to certain parts of the industrial network. He said one of his clients reported that he had to ‘open the floodgates’ and give access to all of his field workers so they could do their jobs during the COVID-19 pandemic.

“It’s a pretty bad situation,” he said.

What do they want and how do they get it?

Bad actors generally have one of three motives, according to Capdevielle. In its simplest form, a cyberattack is about money, which attackers get by encrypting assets and then demanding ransomware. “And those happen in industrial control networks because you do have a lot of windows machines,” he said.

But deeper more troubling attacks can come from those who wish to inflict harm on entities with whom they have ideological disagreements and/or from nation states that want to show dominance, he explained. This latter example is what many believe Russia did to the Ukraine electricity network in 2015, knocking out a significant portion of the grid for a short time. In a situation like that, Capdevielle said the nation state could be just “showing muscle,” in other words it is showing the victim what it *could do* if it wanted to.

To a grid operator, an attack might go unnoticed for a long time. He said cyberattacks begin when attackers gain access to a network and then do reconnaissance work, where they look around and see what they can find. They may move a file from point a to b, which didn’t hurt anything but just isn’t normal. So, protection begins by looking for those anomalies, he said.

“You look for activity that looks like reconnaissance,” he said. Perhaps the operator might see a scan of some kind taking place “and scans are not normal, especially in the industrial control network,” he added.

IT/OT convergence means OT cybersecurity should be on par with IT cybersecurity

Capdevielle said it’s clear that cybersecurity of the OT network is lagging behind that of the IT network. In fact, within a utility itself, it might not even be clear who is responsible for the security of those industrial assets.

“It’s not maintenance, it’s not generation, or transmission, or safety,” he said, adding “it’s related to all of those” but one business unit doesn’t have oversight into it. He believes that Chief Information Security Officers (CISOs) should have that oversight.

“At the end of the day, you want one person responsible for the cybersecurity stance of the company and that tends to be the CISO,” he said, because “ultimately at the end of the day, we are all connected whether we like it or not.”

And as the world deals with COVID-19, the bad actors are not taking a break. Capdevielle said that a recent attack on the US Department of Health is a good example.

“The evil doers are not stopping.”

With more people working on laptops at home in response to shelter-in-place orders, that attack surface has grown larger than ever before. “So this is a time when we really need to pay attention to cybersecurity for anything that is supported by industrial control networks,” he said.

“Industrial control networks by definition support the most important processes of companies that have them,” he said. It is time to protect them. “There is no more delay,” he said.

Originally posted on POWERGRID International.

By Michael Goldman

This series of articles seeks to explore how utilities are helping customers meet sustainability goals and facilitate a transition to a low-carbon future. This transition will be illustrated through a number of case studies showing the various ways in which utilities are enabling a clean energy future for customers through strategies such as energy efficiency, strategic electrification, and enabling increased renewable energy consumption.

According to the EPA, the transportation sector is now the largest source of greenhouse gas emissions in the country. As such, it is natural that customers with sustainability plans or carbon reduction goals would seek to reduce emissions from their fleets and pursue strategic electrification strategies.

National surveys confirm this trend. A 2019 survey conducted by Black & Veatch showed that over half of utility survey respondents are already engaged with their local transit agencies to support electrification. This article highlights a unique partnership between the City of Minneapolis and Xcel Energy that focuses on reducing the city’s emissions through a fleet electrification initiative.

Since at least 2010, the City of Minneapolis has had a Green Fleet Policy. The objectives of this policy are, in part, to “Reduce tailpipe emissions” and “Purchase, when necessary, new vehicles that provide the best available net reduction in vehicle fleet emissions, considering life-cycle economic and environmental impacts.”

The Green Fleet Policy is a critical component of the city’s climate action emission reduction goal of 80% by 2050. The city even has a long-term goal of electrifying its entire 1,700 vehicle fleet. One of the most frequent concerns cited when considering a transition to an electric fleet is the lack of charging infrastructure. This is where the partnership between Xcel Energy and the city is so vital.

In late 2018, Xcel Energy proposed a series of demonstration projects related to transportation electrification (docketed as 18-643). A main component of the proposed demonstration project was a Fleet Electric Vehicle Service Pilot that was geared towards helping three entities: Metro Transit, the Department of Administration, and the City of Minneapolis. The pilot was aimed at helping organizations operating different classes of EVs, not just light duty vehicles. The $14.3 million-dollar proposal covered both Capital and O&M expenses and was focused on providing EV service connections, EV supply infrastructure and charging equipment, and EV advisory services. Most of the budget was earmarked for EV chargers themselves. It is estimated that this program would provide 90 ports specifically for the City of Minneapolis with hundreds of additional ports for other state agencies. An additional $9.2 million was to be set aside for public charging infrastructure.

Part of Xcel’s filing with the Minnesota Public Utilities Commission (PUC) requesting approval for its EV demonstration projects included a letter of support from the City of Minneapolis that outlined a Memorandum of Understanding (MOU) that covered transportation electrification. The MOU between the city and Xcel covers several different areas with an overarching goal of supporting the adoption of EVs, supporting the city’s goal of electrifying its fleet, and using the demonstration to generate economic and environmental benefits.

The MOU also highlighted how the results of the demonstration could be more broadly applicable and help push the adoption of EVs beyond just government agencies. In addition to support from the City of Minneapolis, Xcel’s filing also included letters of support from the Metro Transit agency related to Xcel’s proposal to help develop behind-the-meter electric service infrastructure to support electric buses and from the state’s Department of Administration that believes that the Xcel demonstration would help meet the state’s greenhouse gas emission reduction goals. In April 2019, the PUC approved Xcel’s demonstration project.

This degree of support should not be surprising as the city and Xcel have previously collaborated on other critical energy initiatives. In fact, the City of Minneapolis has a formal Clean Energy Partnership with Xcel Energy and CenterPoint Energy, the other main utility in the city. This formal partnership was established in 2014 with the explicit objective to “work together to achieve the city’s climate and energy goals.” The Clean Energy Partnership focuses generally on energy efficiency, renewable energy, and making clean energy more accessible. One of the ten specific partnership activities called out in the Clean Energy Partnership includes installing electric vehicle infrastructure for the city’s fleet. Xcel’s EV demonstration projects clearly fall within the spirit and intent of the Clean Energy Partnership.

The depth and specificity of the partnership between the City of Minneapolis and Xcel Energy is unique in many ways. But it serves as a useful example of how utilities and customers are working together to meet ambitious sustainability and climate goals.

Originally posted on POWERGRID International.

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