A platform-based approach to distribution operations
Brad Williams, vice president, industry strategy at Oracle Utilities gives his views on the challenges facing distribution network operators (DNOs) as they continue to make the transition to distribution system operators (DSOs).
11th February 2019 by Networks
The energy landscape today is undergoing significant transformation as distribution network operators (DNOs) continue making the transition towards distribution system operators (DSOs). Led by widespread growth of distributed generation – including 27.0GW of installed rooftop solar capacity globally in 2017(1) – along with battery storage, electric vehicles (EVs), and other forms of distributed energy resources (DERs), DSOs face significant changes to the traditional energy delivery model. Coupled with an evolving regulatory framework, in order to continue to provide safe, reliable, and affordable grid services, DSOs are looking at new, modern approaches to safely connect, model, manage and optimise customer DERs within the overall network.
Using only traditional approaches to operations, it’s difficult for DSOs to predict and accurately forecast granular intermittent renewable generation, their aggregated impact on the grid connection points, and overall energy supply. Because solar and wind are not dispatchable, operators can’t choose when to use the electricity from these resources. Instead, they must analyse and mitigate any impacts of its inherent intermittency. To resolve this dilemma, DSOs must re-examine near-term and long-term plans for DER technology integration.
DSOs today are witnessing the increased need to leverage distribution network technologies to accommodate sustainable growth through customers’ burgeoning interest in grid-connected, customer-owned energy technologies. Fewer than one in six global utility survey respondents in 2013 anticipated distributed generation to supply more than a 10 per cent share of electricity demand by 2025(2). With expectations now at 12 per cent, global generating capacity being distributed (65 per cent of which is solar PV)(3), the industry today is wondering when, not if, this will impact the utility business. As policies that concern these technologies—customer choice, emissions reductions, weather-related outage response—begin to unfold, a fundamentally different approach to support a distributed model is needed.
DSOs need to ensure that current technology investments and upgrades act as stepping stones to support the programs they want to offer and the expectations of future customers. A decision today to invest in a one-off, limited-use technology, or to contract with third-party service companies, could significantly increase the technology costs to offer new programs or support new business models in the future.
In contrast, investments in technologies that align with a strategic vision of the future utility with a customer-centric perspective will provide current and future benefits, including:
- Executing on long-term business planning including transformation: Prevent dead-end investments in applications that will clearly need to be changed out in the future. Focus instead on the strategic vision and aligning use cases for business planning around the engaged prosumer. This enables incremental responses to growing customer demands.
- Performing while undertaking digital transformation: Give staff time to drive digital transformation by gaining experience with new procedures and business processes while there is still a relatively small amount of customer-owned energy technologies on a system.
- Analysing risk carefully and early on: Lower the cost and risk of pilot programs. Planners can have a fully tested, real-life technology structure within which to design, offer, and evaluate the results of a wide variety of possible offerings. They can gain experience not only with the technology itself, but also business process changes necessary to support the scale accompanied by widespread adoption of DER. As the most successful pilots transition smoothly into permanent programs, there is no loss of momentum while staff members struggle to scale up technologies that work well only when the number of program participants is small.
Oracle Utilities focuses on delivering this customer-centric, platform-based approach to advanced distribution grid management – setting the foundation to meet today’s challenges and adapt to future opportunities. Rather than the traditional, specific operations unit-based efforts, this integrated approach to achieve scale while cost-effectively integrating future customer demands, regulatory changes, grid operations, asset management and workforce optimisation is the necessary journey forward. The roadmap to success is not one size fits all, but it begins with executing on a strategy that puts all the pieces together and unlocks opportunities not just for one group, but across the entire enterprise.
References: 1. Global Market Outlook for Solar Power 2018-2022, SolarPower Europe, June 2018, Available: http://solarpowereurope.org/reports/global-market-outlook-2018/
2. PwC; 12th PWC Annual Global Power & Utilities Survey, Smarter Energy – Distributed Generation; page 22, Dec. 2013
3. Frost & Sullivan, Future of Energy, page 5, Dec. 2017, Available: https://ww2.frost.com/files/6615/1619/3733/Future_of_Energy_Value_Proposition_-_Dec_2017.pdf
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