Energy Planning Integrated with Councils (EPIC)
| Funding mechanism | Network Innovation Allowance (NIA) |
|---|---|
| Duration | Feb 2021 - Dec 2022 |
| Project expenditure | £540K |
| Research area | Customer and stakeholder focus |
Objective(s)
The objective of the project are to;
- Develop a standardised process that can be used with different local authorities to create a local energy plan.
- To create energy plans for the three trial areas
- To determine how to reflect the local energy plans in the DFES used for network planning purposes
- To disaggregate the DFES data to support LV and HV planning
- To develop a tool to support automated analysis of HV networks and suggest network remedies
- To analyse the HV and LV networks associated with at least one primary substation in the trial areas and provide a view of the network and non-network solutions under different investment strategies
- To develop a tool to allow the investment plans for electricity networks, gas networks and the local authorities to be compared to identify potential synergies
- To use the tool to create an Integrated Investment Plan in the trial areas.
- To refine the processes to reflect the learning gained during the project.
Problem(s)
As part of the process to create Distribution Future Energy Scenarios (DFES) gas and electricity utilities reflect local and regional factors as well as information from local authority development and decarbonisation plans. Local authorities are consulted and give input to the DFES process however the DFES, since it is based on national scenarios, does not wholly adopt or incorporate local authorities’ longer term strategic plans. This could lead to different expectations of future energy requirements between the local authority and the utilities. There is also a potential missed opportunity to align plans across energy networks and to take a more holistic and strategic view of future investment options, which could lead to better investment outcomes both for the networks and for regional stakeholders. To close this gap a new process needs to be developed which will align planning assumptions but also provide stakeholder input into the way solutions to network constraints are selected. These solutions may involve non-network options such as flexibility services. Given the large number of different local authorities that the network operators liaise with,
the new process needs to standardized but still be able to work with differing levels of available data.
Method(s)
The project will develop a process to support the creation of an integrated local energy plan in a format that can be incorporated back into a DFES analysis.
The local energy plans will then be used to modify the National Grid Best View and WWU regional gas scenarios, which will then be used to determine the changes in profiles for electricity and gas usage. Power flow and gas flow analysis will determine the expected network issues resulting from those load and generation profiles and investments to overcome them will be proposed. For National Grid the project will define and develop a new tool to enable the automated analysis of the HV network and use the existing Network Investment Forecast Tool (NIFT) to assess the impact on LV networks. For WWU the project will identify and develop potential enhancements to the process of incorporating local authority information in their investment plan. Similarly WWU will be enhancing the data that they use for analysis to reflect developments in the use of hydrogen and bio-methane.
The planned investments on the electricity network will be combined with those from the gas utility and the local authority in a new tool to help determine the combined benefits of one set of potential investments against another set, the effect of changing the timing of investments etc. This tool is expected to assess the long term cost to the consumer using a Net Present Value (NPV) financial model and be able to assess the trade-off between the risk of regret cost versus the opportunity to support regional strategic development goals, such as decarbonisation, supporting local jobs etc.
As well as considering cross network and non-network solutions the project will assess three different types of investment strategy:
- “Just in time investment” – which is broadly the baseline approach of making individual network investments only as and when network demand becomes apparent and connections applications are made. This approach minimises risk and regret cost, but foregoes the opportunity to harness economies of scale and economies for combining investments. It may also prove to be more expensive over the longer term potentially requiring multiple network upgrades.
- “One Touch or Fit for the future” investment under which investment is made as demand becomes apparent and connections are triggered but network assets are then future proofed by building in additional capacity to meet the anticipated growth in demand.
- “Strategic investment” which entails taking a more holistic approach to look at the totality of energy requirements across multiple sites and customers and developing a proposal to make anticipatory investment to unlock net zero and regional economic growth opportunities. This implies taking more risk but also seizing the opportunity to combine investments, harness economies of scale and collaboration.
The process and supporting tool set will be trialled with between three selected trial areas within the West of England Combined Authority (WECA) area.