How Engene substation became world-famous
Agder Energi’s substation outside Arendal has become a global example of how cloud technology and machine learning can be used to revolutionize the electric power industry and power system as we know them.
The substation at Engene, which serves 5,000 households as well as various businesses, had started to become overloaded in winter and was creating headaches for Agder Energi Nett. To accommodate growing demand, it would need to be replaced, at a cost of NOK 50 million. If there wasn’t a better solution …
- Today’s power grid isn’t designed to supply the large amounts of energy needed in a short space of time when charging electric vehicles, for instance. At Engene we faced a specific challenge that we wanted to solve by thinking outside the box, and one thing has led to another since then, explains Agder Energi’s CEO Tom Nysted.
A meeting between Agder Energi and Microsoft in late 2015 kick-started the innovation project that became known as the “Flexibility pilot” within the company. By combining Microsoft’s IT expertise with Agder Energi’s industry knowledge, the partnership started exploring new, innovative ways to make smarter use of the electricity network. Engene substation was the perfect test bed for trialling new cloud-based technology.
New opportunities in the old electric power system
Two years later we (almost) have the answers.
- What has happened on a small scale at Engene is revolutionary for the power industry, and it will benefit both grid operators and customers. As part of the project, we are now in the process of developing new business models that will turn today’s power system upside down. That is good for both grid operators and consumers. If we can invest less in the electricity network, the result is transmission tariffs that are lower than they would otherwise have been, says Tom Nysted.
The “new business models” referred to include NODES, a collaboration between Agder Energi and the power exchange Nord Pool that will put the technology developed at Engene into practice. We’ll come back to that later, but let’s first return to the substation outside Arendal.
- The stability of the power grid depends on there being a balance between power generation and power consumption. At the moment, generation is adjusted to match the amount of electricity being consumed. But what if we turn that notion on its head? Why don’t we use electricity based on how much power is available, asks Nysted rhetorically, before adding:
- The Engene project is vital to our ability to do this in real time, automatically and on a large scale.
Over the winter, the substation avoided overloading by disconnecting equipment at enterprises based on various analyses of weather data, historical data and power generation data. As a result, Agder Energi Nett can postpone a NOK 50 million investment.
A renewable energy system is a flexible one
Rune Hogga has led the Flexibility Pilot, and is now CEO of the company NODES, which we mentioned previously. We challenge him to explain what the concept really involves:
- In some ways flexibility has become the industry buzzword, but it’s about using capacity that already exists. This can involve either increasing generation or disconnecting equipment at consumers, explains Hogga, who compares the platform to Airbnb.
- Like other digital platforms, it’s all about making capacity that already exists available. Many of the private rooms that are now for rent around the world were not available until Airbnb came along. Just like you can avoid having to build new hotels by using the rooms that already exist, a flexibility market platform will locate available capacity in the power system, explains Hogga.
In the past, grid operators haven’t had access to this capacity. According to an analysis performed by the Norwegian Water Resources and Energy Directorate, the electricity network in Norway will require almost NOK 140 billion of upgrades over the coming ten years.
- Every electric vehicle that is sold will only increase those needs. At some point we have to stop simply building more capacity, and instead look at how we can make the most of what we already have, says Hogga, before adding:
- During the project we have, for instance, disconnected the underfloor heating at sports centres and large frozen storage facilities for short periods. In combination, these kinds of measures allow us to adjust demand, and they are good examples of the ‘empty rooms’ that we are now making available to the benefit of society.
Machine learning and algorithms are creating a new layer in the electric power system. All systems can communicate with each other to solve the challenges that arise. And ideally discover them before they occur.
Since the Engene project has been such a success, and is being further developed by NODES, Agder Energi is investing heavily in the German demand response market.
- The industry has changed more over the past ten years than over the previous century. And it continues to develop quickly. There are few technological limits, so working with the authorities and market players will be the key to setting the parameters for a new international energy market that operates in real time, says Nysted.
Brad Smith, from Microsoft, on stage in Paris dec 11th 2017.
Engene hits the word stage
On the second anniversary of the signing of the Paris Agreement, Microsoft’s CEO Brad Smith took to the stage in Paris to announce the programme “AI for Earth”. A programme that aims to use cloud-based solutions and machine learning to help to solve the challenges associated with climate change. The Flexibility Pilot was one of three projects around the world he highlighted.
- In Norway we are lucky enough to have the flexibility of dispatchable hydropower, in other words we can adjust it up and down to meet demand. In Europe, and particularly in Germany, they won’t be able to do that in the future, explains Tom Nysted.
When coal and nuclear power are phased out and replaced by solar and wind power, Europe will move to an energy market that is largely based on non-dispatchable generation. This will need to be managed, whether generation is too high or too low.
- Germany is the perfect example of how this technology platform can be used to implement the country’s Energiwende – the transition to a green power system. Lots of exciting things are happening and many of the things going on in the Germany market will also reach Norway, says Nysted, before concluding:
- We believe very strongly that flexibility is the key. With NODES we are looking at various types of flexibility that will all be useful tools to have at our disposal for a renewable power system, says Nysted.