Government moves to boost smart energy grids

11th November 2016

Related Topics

Related tags

  • Mitigation ,
  • Generation ,
  • Conventional


Andy Tilleard

Proposals to create a more flexible energy system using energy storage, electric vehicles and demand-side response (DSR) have been published by government.

The consultation outlines the ambition of regulator Ofgem and the Department for Business, Energy & Industrial Strategy (BEIS) for a system in which businesses, power stations, vehicles and homes actively balance their energy needs.

This should drive down the cost of energy for businesses and consumers by as much as £8bn a year by 2030, the National Infrastructure Commission predicted in a report published earlier this year.

The Ofgem and BEIS consultation is seeking views on how to encourage businesses to participate in DSR, where they would be paid for reducing down electricity use at peak times.

In a survey of 92 large companies by Ofgem fewer than one third (29%) said they took part in DSR.

Source: Ofgem

Around 60% of respondents not taking part in DSR acknowledged that their business had the potential to participate. Of those already participating, the majority believed they could offer more flexibility without affecting their businesses.

The survey identified more than 400MW of potential additional demand reduction, Ofgem said.

Barriers to a higher uptake of DSR by business, according to research by the government, include: a lack of awareness of the opportunity to participate; a perception that business processes are not suitable for DSR; lack of clarity on; conflict with existing environmental schemes; and concern about impact on business performance.

The consultation also looks at how network companies can streamline the process of connecting storage technologies to the grid. In recent months, more than 19GW of applications have been made to connect storage to the grid, Ofgem noted.

Ofgem and BEIS have requested evidence on the role of electric vehicles (EVs) in a smart energy system. The mass roll-out of EVs could shift peaks in electricity demand and function as a substantial energy storage system, they said.

Dermot Nolan, Ofgem chief executive, said: ‘Having a smarter system will revolutionise how we all interact with the energy market. A smarter system also makes it far easier for new businesses to enter the market and offer new services. To get there we must make sure the regulatory regime is fit for the energy system of tomorrow and remove any barriers.’

The renewable energy industry welcomed the consultation. Nina Skorupska, chief executive at the Renewable Energy Association, said: ‘This document clearly shows that the government is aware of the revolution taking place in the energy sector right now, and sees that the shift to a more decentralised, flexible system could feel as radical as the emergence of mobile phones.’

But she added that policy needed to change quickly, since storage and DSR technologies are evolving very rapidly and the government risked being in a position where it is playing catch up or standing in the way of progress.

‘Moving quickly by addressing policy barriers and prioritising these technologies in the industrial strategy would also help position the UK as an international leader. This translates to more jobs for UK firms as these technologies will also be deployed on a massive scale internationally,’ she said.

Leonie Greene, who leads on the Solar Trade Association’s smart power work, said: ‘For decades the electricity sector was one of the least innovative industries in the world. It is potentially poised to become a global hotbed of innovation and by moving early the UK has the chance to do more than save consumers a lot of money – we can become an international leader in the smart power industry.’

Last week, think tank the Policy Exchange called for regulations to be updated to boost the UK's potential for a smart grid.


Subscribe to IEMA's newsletters to receive timely articles, expert opinions, event announcements, and much more, directly in your inbox.

Transform articles

SBTi clarifies that ‘no change has been made’ to its stance on offsetting

The Science Based Targets initiative (SBTi) has issued a statement clarifying that no changes have been made to its stance on offsetting scope 3 emissions following a backlash.

16th April 2024

Read more

While there is no silver bullet for tackling climate change and social injustice, there is one controversial solution: the abolition of the super-rich. Chris Seekings explains more

4th April 2024

Read more

One of the world’s most influential management thinkers, Andrew Winston sees many reasons for hope as pessimism looms large in sustainability. Huw Morris reports

4th April 2024

Read more

Alex Veitch from the British Chambers of Commerce and IEMA’s Ben Goodwin discuss with Chris Seekings how to unlock the potential of UK businesses

4th April 2024

Read more

Regulatory gaps between the EU and UK are beginning to appear, warns Neil Howe in this edition’s environmental legislation round-up

4th April 2024

Read more

Five of the latest books on the environment and sustainability

3rd April 2024

Read more

Ben Goodwin reflects on policy, practice and advocacy over the past year

2nd April 2024

Read more

In 2020, IEMA and the Institute and Faculty of Actuaries (IFoA) jointly wrote and published A User Guide to Climate-Related Financial Disclosures. This has now been updated to include three key developments in the field.

2nd April 2024

Read more

Media enquires

Looking for an expert to speak at an event or comment on an item in the news?

Find an expert

IEMA Cookie Notice

Clicking the ‘Accept all’ button means you are accepting analytics and third-party cookies. Our website uses necessary cookies which are required in order to make our website work. In addition to these, we use analytics and third-party cookies to optimise site functionality and give you the best possible experience. To control which cookies are set, click ‘Settings’. To learn more about cookies, how we use them on our website and how to change your cookie settings please view our cookie policy.

Manage cookie settings

Our use of cookies

You can learn more detailed information in our cookie policy.

Some cookies are essential, but non-essential cookies help us to improve the experience on our site by providing insights into how the site is being used. To maintain privacy management, this relies on cookie identifiers. Resetting or deleting your browser cookies will reset these preferences.

Essential cookies

These are cookies that are required for the operation of our website. They include, for example, cookies that enable you to log into secure areas of our website.

Analytics cookies

These cookies allow us to recognise and count the number of visitors to our website and to see how visitors move around our website when they are using it. This helps us to improve the way our website works.

Advertising cookies

These cookies allow us to tailor advertising to you based on your interests. If you do not accept these cookies, you will still see adverts, but these will be more generic.

Save and close