The Trends toward Greater ICT Control and Integration into the Grid Underlying Policies and Market Drivers

concepts of power engineering and electrical design dating from the late 1800s. Power flows from large-scale generating plant through high-voltage transmission and lower-voltage distribution networks before being delivered to consumers. This system is used throughout the world with great success, and is an essential enabler of modern living. Recently however, both government policies and market forces have produced drivers that challenge the notion of an electricity grid being a simple unidirectional series of wires and transformers and make the case for a ‘smart grid,’ in which information and communication technologies (ICT) are integrated directly into the electricity networks. These advances have the potential to transform the way customers and supply companies interact with electricity, and provide significant new commercial opportunities for communications, monitoring, control, and data aggregation technologies throughout the electricity system, from generation through to the consumer. European governments have heavily invested in large-scale demonstration and development projects to trial smart grid and metering technologies, with current investments totalling approximately €5 billion. These projects are being driven by: (1) Policies to decarbonise national electricity systems being led by governments (2) Concerns regarding security of energy supply and the resilience of electricity networks to extreme events (3) Moves towards greater competition, choice, and innovation in the energy supply market (4) The integration of electric vehicles, electric heating, and distributed generation (5) The development of ‘smart’ meters and home appliances Decarbonisation policies and incentives are the first key set of drivers towards a smart grid, and have far-reaching consequences for the energy system. The UK, for example, has a legally-binding target of an 80% reduction in carbon emissions by 2050, which most models suggest would require a virtually decarbonised electricity sector by 2030 in order to meet. The European Union has set a target for 20% of EU primary energy to come from renewable sources by 2020. Due to the difficulty of providing economical renewable heating and transport, a large majority of this energy will need to come from renewable electricity generation. The UK’s share of this primary energy target has been set at 15%, which will require renewable generation providing 30% or more of total electricity supply in the UK on a regular basis. The integration of this quantity of renewable generation into an existing electricity system leads to some significant challenges. In a traditional electricity system, supply is adjusted to match current demand. This becomes an issue with large proportions of renewables and other low-carbon forms of generation due to their particular characteristics. Low-carbon generation can generally be divided into two major forms. Firstly there are those, such as nuclear power or carbon capture and storage (CCS), which provide base-load electricity but are inflexible, meaning it is uneconomic or technically infeasible to change their output levels. Secondly, renewable energy generation sources such as wind and solar are intermittent, providing variable levels of The Trends toward Greater ICT Control and Integration into the Grid Underlying Policies and Market Drivers