Innovation, spatial plan key to UK decarbonized grid: National Grid Partners

Completing UK planning reforms and a spatial network plan alongside investment in new technologies is urgently needed to achieve a decarbonized grid in the 2030s, Steve Smith, president of National Grid Partners -- the venture capital arm of National Grid -- told S&P Global Commodity Insights at an innovation day event in London on June 18.

The technologies, including sensors that help maximize line flows, carbon core conductors that eliminate thermal sag and using artificial intelligence to problem solve, all boost capacity and reduce infrastructure spend, but the risk of policy delay due to the general election on July 4 would be costly.

"Most of what we need is understood -- whether it is the Conservatives saying 2035 or Labour saying 2030 [for a fully decarbonized grid]," Smith said.

In generation, however, the UK needed "two or three" successful CFD auctions to get back on course with a 50-GW offshore wind target by 2030, "and that probably needs some policy tweaks."

And while battery storage was booming, "the big thing we don't have yet is long duration storage -- the existing government has started policy mechanisms to deliver that, but it needs completing and the risk is that a new administration coming in gets distracted," he said.

On the potential for regional pricing in the GB market as a result of the government's Review of Electricity Market Arrangements, meanwhile, Smith noted National Grid ESO was spending up to GBP4 billion/year ($5 billion/year) to balance the transmission network.

"Balancing costs are double what we're spending on infrastructure -- we've got to look at that, but we need to be careful. We haven't completed smart metering, nor have we rolled out half hourly settlement yet," he said.

Maxing assets

Innovation would be the difference between doubling, not quadrupling the size of the grid, said Ben Wilson, National Grid's Chief Strategy and Regulation Officer.

"We've been in a low-growth world with the emphasis on efficiency and low capital spend. Now we're at an inflection point with demand growth expected from data centers, AI computing, reshoring and reindustrialization," he said.

In May, National Grid announced a doubling in investment over the next five years to GBP60 billion, while raising GBP7 billion via a rights issue.

"If we don't innovate, we'll need an electricity system four times the size of today by 2050. If we do it smart, we'll need one twice the size," Wilson said.

Several NGP-backed technology startups were on display during the London event, including two US companies: LineVision and TS Conductors.

LineVision fits LiDAR sensors to pylons and poles to measure line sag due to wind and temperature conditions. It sends this dynamic line rating data to a control center, which can respond by increasing transmission flows by up to 40%.

"I've worked in this industry for 30 years and you don't often see a technology that is easy to deploy, has a five to 10 times payback, and crucially does not require expensive outages on the system," Smith said.

National Grid is trialing the sensors on three lines in the UK and saving GBP20 million/year. Its Upstate New York control center, meanwhile, is being modified to use the data.

Another company in NGP's portfolio is TS Conductors, which uses pre-stretched carbon cores in its cables instead of steel, reducing line sag and weight. The company claims a tripling of capacity on existing routes, and a halving of line losses. While more expensive than conventional conductors, the savings come in increased capacity without the cost of replacement towers.

Digital twin

In a separate interview with Commodity Insights during Eurelectric's annual summit in Greece in May, Siemens Grid Software CEO Sabine Erlinghagen said Europe's distribution network investment could be cut by Eur12 billion/year ($13 billion/year) by using new technologies.

Distribution-level investment may have to double to Eur67 billion/year if Europe is to deliver the "societal mega shifts" of decarbonization, electrification and digitalization, according to Eurelectric.

"Annual capex could be reduced to Eur55 billion or less if you apply the right technology. A massive lever in that is running grids closer to their physical limits," Erlinghagen said.

Distribution system operators often apply generous buffers to operational parameters because they run their assets on assumptions: "we don't know exactly what's going on, especially at low voltage level but also at medium voltage," Erlinghagen said.

This is the first frontier where technology can help, with smart meters now providing data for over 56% of European electricity consumers, rising to as much as 78% by 2028, according to Berg Insight.

Twinning meter data with an understanding of grid topology allows an operator to "calculate backwards" from the relevant transformer. This is much quicker and cheaper than installing sensors, Erlinghagen said.

"By starting where the distributed resources are, you're effectively flipping grid management on its head. This provides the observability and transparency DSOs need to run their grids closer to actual capacity," she said.

As grid limits are reached, "you want the opportunity to react. If I see in real time that a transformer is overloading and there's a problem, what is my ability to react? What flexibility can I tap in to?"

This is where statistical analysis and artificial intelligence comes in, helping the DSO understand to what extent consumers at domestic, commercial and industrial level will react to price signals, notably via flexible tariffs, Erlinghagen said.

"We're no longer talking about large power plants, we're talking about millions of distributed resources. You need AI to help make predictions of how consumers will react, and provide reliable options to an operator -- it's something the human brain just can't do," she said.

Norwegian DSO Elvia offers a case study. Its grid is at saturation point and cannot continue making connections via conventional means.

By creating a "digital twin" to its physical network, however, Elvia is learning to access consumer flexibility, ultimately allowing it to offer conditional connection approvals, Erlinghagen said.