Electricity networks of the future: How to accommodate DG and renewables

Among the obstacles to the growth of distributed generation have always been difficulties with connection to, and operation within, centralized national power grids. However, in Europe at least, work is underway to design new, flexible and DG-friendly grids. Christian Sasse reports.

Electrical energy is a primary prerequisite for economic growth and it is a key issue influencing the competitiveness of economies. Today’s electricity networks have evolved over more than a hundred years and have been built up to perform efficiently and effectively. Electricity networks assure access for every single customer to electrical energy, according to a vertically integrated scheme with centralized generation, diffused consumption, limited interconnection capacities between the control areas, and commercial and regulatory frameworks that are not harmonized for mutual advantage.

In response to the challenges and opportunities faced, electricity networks started to evolve in a more decentralized scheme, with many actors involved in generation, distribution and operation of the system. New challenges made available from market liberalization and technical breakthroughs call for new approaches. This article will analyse the upcoming trends and describe potential future architectures of electrical networks, taking into account the actual network structure.

Electricity networks of today

Today’s networks are based on large central power stations transmitting power via high-voltage transmission systems, which is then distributed in medium- or low-voltage local distribution systems. The transmission and distribution systems are commonly run by a natural monopoly (national or regional body) under energy authorities’ control. In contrast, the generation sector is increasingly competitive. The overall picture is still one of power flow in one direction from the power station via the transmission and distribution system, to the final customer. Dispatching of power and network control is typically the responsibility of regionally centralized facilities. There is little or no consumer participation and no end-to-end communications.

The fuel cell is amongst the diverse range of existing technologies that can be integrated into future electricity networks (Siemens Westinghouse)
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Traditional network design was based on ideas of economies of scale in large centralized generation and the geographical distribution of generation resources (such as locations near coal fields, cooling water, etc). The electricity networks were optimized for regional self-sufficiency. Interconnections were originally developed for mutual support between countries and regions, but are increasingly being used for trading between states. The transmission networks provide an arena that has traditionally enabled centralized economic optimization and enhances the overall reliability of power supply. Distribution networks have seen little change and tend to be radial, with mostly unidirectional power flows and ‘passive’ operation. Their primary role is energy delivery to end-users.

The existing network system provides an excellent foundation from which future challenges and opportunities can be met.

Electricity networks of the future

Future models for electricity grids have to meet the changes in technology, the values in society, the environment and commerce. Thus security, safety, environment, power quality and cost of supply are all being examined in new ways, and energy efficiency in the system is taken ever more seriously for a variety of reasons.

New technologies should also demonstrate reliability, sustainability and cost-effectiveness in response to changing requirements in a liberalized market environment across Europe.

The organization of the network in the future will be affected by the dynamics of energy markets. Scarcity of primary energy sources on one hand and climate change on the other are likely to greatly affect decisions on new investments in generation. It is not so much the case of playing central versus distributed solutions, but much more to take advantage of a wide energy technology portfolio and the coexistence of all possible solutions.

In the future, system operation will be more largely shared between central and distributed means of generation and control.

Large penetration of distributed generation (DG), renewable energy sources (RES), demand-response and demand-side management (DSM), and energy storage may displace a proportion of the electrical energy generated by large conventional plant. Additional stand-by capacity might be required, which could be called upon whenever the intermittent RES ceases to generate power, and it may be economically efficient to seek a multi-national rather than a national solution for balancing the capacity requirements. In addition, efficient integration of DG is unlikely to be made without changes to the transmission and distribution network structure, planning and operating procedures.

The key challenges that need to be considered in the composition of future networks are:

  • The integration of both distributed and centralized generation from renewables – particularly wind and solar, but also biomass, tidal and hydro – are recognized as growing in importance as more of these power-generating schemes are connected to the networks.
  • To obtain maximum benefit from the internal market and manage cross-border congestion, new technological solutions need to be investigated to match bulk power transmission lines with increased transmission demand. Alternatives to overhead lines, such as classic alternating current (AC) cables, high-voltage direct current (HVDC) cable systems, superconducting cables and gas insulated lines (GIL) have to be analysed regarding not only technical but also economic aspects.
  • The problem of ageing infrastructure and network renewal cannot be managed as a one-off issue since asset replacement is a rolling activity.
  • Quality and continuity of power supply under the present and future conditions will need to be addressed. Reverse power flows will occur and, consequently, network operation and control have to be modified considerably – it has to become active and intelligent.
  • The single most distinguishing feature of future electrical grids will be the ability for the users to play an active role in the supply chain. Today most users are passive receivers of electricity without further participation in the operational management of the grid.

New developments

New developments will create opportunities for multilateral participation in the real-time balance between supply and demand.

  • Smart metering, electronic technologies, modern communications and local electric energy management will play a key part in establishing new services. Service-oriented information and communication technology (ICT) will be valuable components in the management of the value chain across suppliers, active networks, meters, customers and corporate systems in real time.
  • Grids will become systems with multidirectional flows of both power and information.
  • Advanced power electronics will allow speed-variable operation of electric generators and motors to increase the overall efficiency of the electric chain as well as to increase the power quality of the grid. Advanced power electronics will also lead to the operation of HVDC lines and back-to-back links with the ability to avoid congestion and to improve power quality of the grid at the same time.
  • In summary, grids are being transformed in networks composed of millions of bilateral nodes on all levels of transmission and distribution integrated across Europe. Bulk transmission and DG will coexist on interconnected grids where the distinct difference between traditional transmission and distribution becomes increasingly blurred.

Possible architectures

One possible model for the network of the future would be that decision-making is distributed and that most power flows are bi-directional. This concept would lead to control being distributed across nodes spread throughout the system. Not only could the source of power for a given consumer vary from instance to instance but also, even for a given consumer and source, the routing could vary as the network self-determines its configuration. Such a system would require hardware and management protocols for connections, whether for suppliers of power or consumers.

This type of network eases the participation of DG, RES, DSM and energy storage and would also create opportunities for novel types of equipment and services.

Small hydro is one type of renewables that can fit into the future energy mix (EHN)
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It is also important to emphasize the role of ICT, in particular telecommunications, to adapt electricity networks to the real-time actions and manage control distributed in the network. A serious effort is further needed to effectively use communications equipment in electricity networks.

The function of the active distribution network is to efficiently link power sources with consumer demands, allowing both to decide how best to operate in real time. The level of control required to achieve this is much greater than in current distribution systems. Power flow assessment, voltage control and protection require cost-competitive technologies and new communication systems with several orders of magnitude more sensors and actuators than presently in the distribution system.

The increased amount of control required also leads to a vastly increased information traffic derived from status and ancillary data. In this way, and in the ability to re-route power, the active network represents a step towards an internet-like model.

The final stage means full active power management – such as a distribution network management regime using real-time communication and remote control to meet the majority of the network services requirement. The transmission and distribution networks are both active, with harmonized and real-time interacting control functions and efficient power flow.

When the final stage is achieved, the users of the network will expect a responsive system. They will anticipate connection according to simple and defined standards. They will also expect accurate billing – to pay for what they use and to be paid for what they supply. ‘Plug and play’ with real-time trading and accounting will be a consequence.

To realize the active distribution networks, Microgrids and Virtual utilities architectures are under discussion.

  • Microgrids are generally defined as low-voltage networks with DG sources, together with local storage devices and controllable loads (such as water heaters and air conditioning) with a total installed capacity in the range of a few hundred kilowatts to couple of megawatt. The unique feature of Mircogrids is that although they operate mostly interconnected to the distribution network, they can be automatically transferred to islanded mode in case of faults in the upstream network, and can be synchronized after restoration of the upstream network voltage.
  • In the Virtual utility (or virtual electric energy market) the structure of the internet-like model and its information and trading capability is adopted, rather than any hardware. Power is purchased and routed to agreed point(s) but its source, whether conventional generator, RES or from energy storage, is determined by the supplier, the system being enabled by information technology.


To enable these concepts for change to be realized and the benefits to be made a reality, the change of the electricity supply structure towards progressively more DG, RES and active grids requires a number of wider and disparate factors to be addressed. These include:

  • improvements of safety standards in the context of critical infrastructures
  • integration of central and distributed generation
  • integration of innovative technologies
  • harmonization of equipment standards
  • funding and incentives, including public and private sharing
  • the impact of neighbouring systems
  • education and skills issues.

There is no doubt that the market and technological forces will lead to a deep structural and technological change in electrical networks. The velocity of change will be different in different regions of the world and will be strongly influenced by the market drivers.

Dr Christian Sasse is the General Manager of the AREVA T&D Technology Centre, Stafford, UK. He is also Chairman of the Advisory Council of the European Technology Platform on the ‘SmartGrids’ project. Fax: +44 1785 78 6499 E-mail: Christian.sasse@areva-td.com

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SmartGrids for Europe

For many decades Europe’s electricity networks have provided the vital links between electricity producers and consumers with great success. The fundamental architecture of these networks has been developed to meet the needs of large, predominantly carbon-based generation technologies, located remotely from demand centres. The energy challenges that Europe is now facing are changing the electricity generation landscape.

The drive for lower-carbon generation technologies, combined with greatly improved efficiency on the demand side, will enable customers to become much more interactive with the networks. More customer-centric networks are the way ahead, but these fundamental changes will impact significantly on network design and control.

Vision of a network of the future
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In this context, the European Technology Platform (ETP) SmartGrids was set up in 2005 to create a joint vision for the European networks of 2020 and beyond. The platform includes representatives from industry, transmission and distribution system operators, research bodies and regulators. It has identified clear objectives and proposes an ambitious strategy to make a reality of this vision for the benefits of Europe and its electricity customers.

The energy policy context

The European Commission’s 2006 Green Paper ‘A European Strategy for Sustainable, Competitive and Secure Energy’ emphasizes that Europe has entered a new energy era. The overriding objectives of European energy policy have to be sustainability, competitiveness and security of supply, necessitating a coherent and consistent set of policies and measures to achieve them.

Europe’s electricity markets and networks lie at the heart of our energy system and must evolve to meet the new challenges. The future trans-European grids must provide all consumers with a highly reliable, cost-effective power supply, fully exploiting the use of both large centralized generators and smaller distributed power sources throughout Europe.

A shared vision

The SmartGrids vision is about a bold programme of research, development and demonstration that charts a course towards an electricity supply network that meets the needs of Europe’s future. Europe’s electricity networks must be:

  • flexible – fulfilling customers’ needs while responding to the changes and challenges ahead
  • accessible – granting connection access to all network users, particularly for renewable power sources and high-efficiency local generation with zero- or low-carbon emissions
  • reliable – assuring and improving security and quality of supply, consistent with the demands of the digital age with resilience to hazards and uncertainties
  • economic – providing best value through innovation, efficient energy management and ‘level playing field’ competition and regulation.

The vision embraces the latest technologies to ensure success, while retaining the flexibility to adapt to further developments. Network technologies to increase power transfers and reduce energy losses will heighten the efficiency of supply, while power electronic technologies will improve supply quality. Advances in simulation tools will greatly assist the transfer of innovative technologies to practical application for the benefit of both customers and utilities. Developments in communications, metering and business systems will open up new opportunities at every level on the system to enable market signals to drive technical and commercial efficiency.

Making it happen

Enabling Europe’s electricity grids to meet the challenges and opportunities of the 21st century and fulfil the expectations of society requires intensified and sustained research efforts. It is essential for this to take place in a coherent way, addressing technical, commercial and regulatory factors, to minimize risk and allow business decisions to be made by companies in an environment of stability.

Key elements of the vision include:

  • creating a toolbox of proven technical solutions that can be deployed rapidly and cost-effectively, enabling existing grids to accept power injections from all energy resources
  • harmonizing regulatory and commercial frameworks in Europe to facilitate cross-border trading of both power and grid services, ensuring that they will accommodate a wide range of operating situations
  • establishing shared technical standards and protocols that will ensure open access, enabling the deployment of equipment from any chosen manufacturer
  • developing information, computing and telecommunication systems that enable businesses to utilize innovative service arrangements to improve their efficiency and enhance their services to customers
  • ensuring the successful interfacing of new and old designs of grid equipment to ensure inter-operability of automation and control arrangements.

These and other elements will be addressed through a Strategic Research Agenda that the Technology Platform will produce in 2006.

Delivering the benefits

The projects resulting from the SmartGrids vision will stimulate innovation in new network and associated information technologies. The benefits of new technologies will have a positive effect for Europe’s citizens and for international business. Job opportunities will be broadened as the networks require workers with new skills and integration across new technology areas.

SmartGrids will help achieve sustainable development. Links will be strengthened across Europe and with other countries where different but complementary renewable resources are to be found. An increasingly liberalized market will encourage trading opportunities to be identified and developed. SmartGrids networks will, in addition to electricity flows, establish a two-way flow of information between supplier and user.

To achieve a successful transition to a future sustainable energy system, all the relevant stakeholders must become involved: governments, regulators, consumers, generators, traders, power exchanges, transmission companies, distribution companies, power equipment manufactures and ICT providers. Co-ordination at regional, national and European levels is essential and the SmartGrids Technology Platform has been designed to facilitate this process.

This is the executive summary of a report: ‘Vision and Strategy for Europe’s Electricity Networks of the Future’, published in April 2006 under ‘SmartGrids’, a research and development project working under the EU’s Sixth Framework Programme.

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