ELECTRICITY DISTRIBUTION NETWORK - IN THE CENTER OF THE ENERGY TRANSITION - Ivanka Dilovska Member of the Management Board Energy Management Institute
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ELECTRICITY DISTRIBUTION NETWORK – IN THE CENTER OF THE ENERGY TRANSITION „The European Green Deal post COVID-19 and the Bulgarian Energy Transition“ Ivanka Dilovska Member of the Management Board Energy Management Institute
TOPICS 1 2 The Green Deal & the distribution National features and perspectives for network the distribution network
DISTRIBUTION NETWORK In Bulgaria Shares of distribution length power lines per type • Length: 154 000 km or 1,5% of the distribution (LV, MV and HV) for each MS network of Europe • Number of customers: 4,9 mln or 1,8% from all the customers in Europe • Distributed energy: 26 TWh or 0,9% from the distributed energy in Europe In Europe • Length: 10 mln km (10 times the distance from the Earth to the Moon and back) • Number of customers: 260 mln • Distributed energy: 2 700 TWh
THE GREEN DEAL IS BECOMING MORE AND MORE AMBITIOUS • On 17th September the European Counsil proposed the GHG-emissions to be reduced by at least 55% (ЕP – 60%) The EU RES target(38-40%) • This will lead to a higher levels of: The EU Energy Efficiency target The national contribution (integrated NECPs) • By June 2021, the EC will review and propose amendments to relevant policy instruments to achieve further emission reductions
THE DISTRIBUTION NETWORK AND THE GREEN DEAL RES generation Intelligent measuring systems Modernisation Distribution network Energy storage Resilience Digitalisation Electrification
THE FUTURE IS ALREADY DECIDED. WHERE DO THE CHANGES START? Current regulatory A new (proactive) approach regulatory approach “Our proposals will help turn Defining specific activities Setting targets and requirements Britain's streets green putting in place the wires and technology for families to travel in Determining remuneration/ electric vehicles and heat their homes and Determining costs and their short bonuses linked to performance businesses with clean energy. The green energy term reduction transformation is not just about putting more cooper in the ground. We need a modern, Looking at reduction of Looking ahead - incentives for digital grid… ongoing investment innovation Local electricity grid will at the forefront of eliminating harmful carbon emissions…, so it’s Ensuring fair returns vital they have the investment to do this whist keeping cost as low as possible for consumers.” Jonathan Brearley, CEO at Ofgem, 30/07/2020, at the presentation of the design of the five‐ The Member States and the National Regulatory Authorities year price controls for electricity distribution (RIIO‐ED2) determine how electricity distribution networks will develop! detailed sector methodology that will start in April 2023.
THE ELECTRICITY INDUSTRY: THE REGULATION IS NOT IN STEP WITH THE ENERGY TRANSITION The first three necessary changes are: 1. New design of network tariffs to ensure that the new entrants / the decentralized generation pay a price commensurate with the network costs they cause 2. The micro-networks, local energy communities and prosumers should be subject to the same responsibilities as other network operators 3. Rapid introduction of IMS and dynamic tariffs to provide maximum incentives for flexibility and optimization of system costs Source: “Where does change start if the future is already decided?“, an EY report with technical support from Eurelectric, 2019
1 2 Зелената сделка & National features and perspectives for разпределителната мрежа the distribution network
THE NETWORK TARIFFS DECREASED BY 25% FOR THE PERIOD 2007-2019 Evolution of the generation and network components in the regulated electricity price for clients, connected to LV grid, 2007-2018 +91,35% Where does the +19,04% +2,19% 108,46 lv. reduction of network -8,57% +1,04% tariffs come from? +19,96% -1,68% +52,81% The technicall losses of energy +4,91% +5,87% at distribution level are 56,68 lv. -15,53% reduced 2,5 times – from 21% to 8% +5,49% -6,43% -4,40% +0,72% +3,85% -13,53% 64,70 lv. +3,25% +1,12% 48,09 lv. What is the result? +26,25% -37,85% 30 million MWh energy savings = -25,67% electricity consumption in the country for one year 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Source: network costs generation costs “2007-2019: HIGHER GENERATION COST, LOWER NETWORK COST”, EMI, 2019
NECP: PERSPECTIVES TO THE DSOs «Development of electricity transmission and distribution infrastructure, of smart networks, of storage facilities and interconnectors in the period 2021-2030 » «Introducing a simplified procedure for grid connections when installations of renewables self-consumers and demonstration projects that use renewable energy with an electrical capacity of 10.8 kW or less are to be connected to the electricity distribution networks» 10
NECP: PERSPECTIVES TO DSOs • As regards measures for reducing technical losses in electricity transmission and distribution via the electricity distribution network, the network operators carry out the following activities: Reducing technical losses in electricity transmission and distribution by means of: − building new transformer units to reduce the length of outlets of low voltage networks and/or redistribute power loads; − replacing installed power transformers by new ones, with lower losses of energy in no-load condition and short circuiting; − thermal imaging audit of transformers, medium and low voltage units to detect problem areas with rising temperature; − increasing the cross-section of medium- and low-voltage conductors in cable and overhead networks. • Increasing the reliability of measuring the quantity of electricity that is received in or leaves the electricity distribution grid and limiting the option for its unauthorised use through: replacement of commercial metering devices securing and re-locating commercial metering devices on the boundary of ownership building SMART GRID networks
NECP: REGULATORY PRINCIPLES EWRC is guided by the following general principles: • In terms of energy efficiency (EE) promoting the increase of energy efficiency in the production, transmission, distribution and final consumption of energy and natural gas creating incentives for transmission and distribution system operators to provide system services to end customers, which enable the implementation of measures to improve EE by introducing smart grids, taking into account the costs and benefits associated with each measure, while ensuring system security • In terms of demand optimization The prices for transmission and distribution shall allow increasing the participation of end customers in improving the efficiency of the electricity system by demand optimization to encourage transmission and distribution system operators to offer system services for the optimization of electricity consumption, energy management and decentralized generation within organized electricity markets and to improve efficiency in the design and operation of networks, in particular: − load shift from peak hours to non-peak hours by end customers, taking into account the availability of energy from renewable energy sources, cogeneration and decentralized generation − energy saving by optimizing the consumption from decentralized generation sources by combining the provision of energy efficient services and participation in the balancing electricity market − reduction of consumption through energy efficiency measures implemented by energy efficient services providers − connection and dispatching of energy sites for MV and LV power generation − connection of energy facilities for electricity production, located closer to the points of consumption − providing access to the networks of energy storage facilities 12
NECP: INVESTMENTS 2021 – 2030 NECP: Investments in electricity sector 5% 20% 15,3 10% mln. € 65% RES Network (transmission & distribution) New nuclear capacity Others (incl. storage)
INVESTMENTS IN ELECTRICITY DISTRIBUTION NETWORK 2021-2030 Average annual investments in distribution network, MEURO OUTLOOK (2021-2030)* 92 *the total NECP investments in network are reduced with those for the transmission network according to the ESO’s Ten-year plan HISTORICAL PLAN (2015-2017) 108 80 85 90 95 100 105 110 2030 investment perspectives below their historical level!
For more information… www.emi-bg.com emi@emi-bg.com
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