Northern Ireland – Reforming the Energy Vision

21 Jan 2020

NIREV: Northern Ireland – Reforming the Energy Vision

The title has been borrowed from the New York REV. Its focus is on empowering consumers and creating the markets and regulatory frameworks needed to deliver the transition to a clean, smart energy system. The key aims of NIREV are to determine how distributed energy resources (DER) can have a fundamental role in future systems; and how DER ownership can empower individuals, households, community groups, social enterprises and businesses.

Consumer-owned DERs can create system value, not just by generating energy but also by providing flexible demand to complement wind and solar generation. While flexibility can already create system value, very little of that can yet be monetised. NIREV will raise awareness of its importance in decentralised, variable renewable energy (VRE)[JB1] dominated energy systems; and will help inform the development of new regulatory and market arrangements, and new business models to monetise that value.

Why is this so relevant to Northern Ireland?

NI is arguably the best place in Europe to develop a decentralised, renewables-led energy system. It is a little-recognised fact that the Irish all-island power system has integrated the highest levels of wind energy anywhere in the world. While Denmark, Portugal and Scotland routinely claim to have generated 100% or more of their electricity from renewables for days or weeks, this reflects administrative, rather than electrical boundaries. As relatively small parts of larger, transnational systems, the challenge of managing high levels of VRE is easier to resolve as it can be shared with bigger, power-hungry neighbours.

In terms of the stability (inertia) required to manage high levels of VRE, Ireland is isolated and must manage everything internally. The Irish system is the current world-leader in integrating wind generation, having developed a ground-breaking ancillary services market which currently allows up to 70% instantaneous penetration of non-synchronous (effectively wind) power. Because of this, NI smashed its target for 40% renewable electricity by 2020, achieving 45% (overwhelmingly wind energy) in 2018/19.

The prevalence  of small-scale wind farms

NI is ideal for decentralisation not just because it has lots of wind energy; how and where that wind is connected is critical too. NI has a dispersed, largely rural population and consequently a long and stringy power system. But unlike other wind-dominated systems with low population density, our wind farms are small-scale and almost all are connected at distribution voltages.

This combination – electrical isolation; a long, stringy network, with very high levels of small-scale, distribution-connected wind power; and the fact that we have relatively little industrial baseload demand (and consequently a ‘peaky’, domestic demand-driven load profile) means that the NI system is ideal to demonstrate the value of flexible demand to manage variability where it arises – at local network level. The rapidly declining costs of energy storage, combined with digital technologies – IoT, artificial intelligence and machine learning - provide the tools required to achieve this and are already being put to work in other systems.Although the technical barriers to decentralisation have largely been overcome, the economic, market and regulatory challenges have not. The focus of NIREV is therefore on learning from international best practice how to develop new market, regulatory and governance structures.

Decentralisation lessons from America

Decentralised energy is on the agenda pretty much everywhere, including in GB and Europe. While there has been some progress on this side of the Atlantic, it’s the United States which is really setting the pace.

Although the New York REV (which began in 2012) is the poster child, there are currently 19 REV-like programmes underway in the US. These are not just happening in Democrat-leaning, environmentally friendly states like California; smart, renewables-led decentralisation is also on the agenda in Republican-voting states like Texas, Alabama and the Carolinas.

While for some states the priority is addressing the climate emergency, the plummeting costs of DER and the popularity of smart local energy with citizens (or voters as some people call them) are the most important drivers in others. Political representatives in North and South Carolina, Alabama and Texas are driving decentralisation not because they’re tree huggers; they’re doing it because they can count - both dollars and votes.

The NIREV programme

The NIREV programme is engaging with organisations like the Rocky Mountain Institute and the Regulatory Assistance Project to learn how decentralisation is being delivered in in the US; as well as UKERC and other organisations closer to home. NIREV has also drawn heavily from the expertise of Professor Catherine Mitchell’s iGov project with the Energy Policy Group at Exeter University.

The NIREV programme will comprise four workshops between December 2019 and May 2020, with a summary report published shortly afterwards.

Watch out for updates on the UKERC website.

NIREV is jointly funded by the Utility Regulator for Northern Ireland and the SPIRE 2 Project, part of the European Union’s INTERREG VA Programme, managed by the Special EU Projects Body (SEUPB).