“Electricity companies must be forced to invest in flexibility – alternative to expensive expansion”

DEBATE

DEBATE. The electricity grid companies must invest in flexibility solutions such as batteries and control of electricity consumption instead of being fixated on expanding the electricity grid, writes Anna Werner, Svensk Solenergi.

Reports about possible power increases in electricity production are pouring in. Most recently, Sweden’s Engineers show that hydropower can be increased by 1,300 MW by the year 2035 by simply increasing the power in the existing hydropower.

In the same way, Swedish Solar Energy has shown that solar power can increase from today’s 4,000 MW to around 30,000 MW in 2030. The other types of power are also not without optimistic forecasts.

The electricity grid companies, for their part, say that they are prepared to expand the electricity grids to take care of the new electricity production, but it will cost in the order of magnitude 1,000 billion.

Of course, the electricity grid needs to be expanded, but a faster and cheaper solution is to make better use of the existing infrastructure. It is done with flexibility on the part of producers and consumers of electricity so that it is produced and used at the right time and in the right place.

The electricity grid companies, which could really provide the necessary incentives for increased flexibility, seem to be paralyzed. This can be explained by the fact that their ability to make money is all too strongly controlled by how much physical electricity grid they build. There are some pilot projects with local flexibility markets, but they are few and only solve problems in single areas. The effort to use the electricity grids smarter through flexibility should permeate the daily work of every grid company at all levels.

Earlier last autumn, attention was drawn to how two villa owners in Kristianstad would pay SEK 93,000 and SEK 50,000 respectively to connect their planned solar cell installations to the electricity grid. The justification was that the electricity network company did not have the capacity to receive more electricity without investing millions in strengthening its electricity network.

A network company may only charge for network reinforcement in connection with the connection of new electricity production after first investigating whether there are other, more efficient ways to remedy congestion in the electricity network than network expansion. Such investigations are almost never reported. Instead, the message is as here that expansion of the network is required.

In the example from Kristianstad, the grid company allowed one customer to export minimally to the grid and the other was not allowed to sell any electricity at all. Simple solutions for the network company that does not need to make any investments, but a bad solution for the customer who is not allowed to sell their electricity. The lack of capacity in the electricity grid must of course not be addressed by rejecting renewable energy sources, but by using available resources in an efficient manner.

The fastest and cheapest way to remove traffic congestion in the Swedish electricity grids is to promote flexibility. Swedish Solar Energy has four proposals for the government to achieve this:

• Make sure that the Electricity Act is rewritten so that grid companies are always forced to report flexibility solutions when they receive a request for connection, not just in the event of a capacity shortage.
• Force the electricity grid companies to report overview capacity maps that show where in the grid there is free capacity.
• Change the calculation of the grid companies’ revenue limits (how much revenue they as monopolists can have over a four-year period) so that flexibility measures significantly increase the size.
• Increase the resources for the Energy Market Inspectorate so that the authority can check that the grid companies at tribal, regional and local level always examine flexibility as an alternative before costly expansion of the electricity grid.

The measures would put pressure on the grid companies to make better use of the capacity in their electricity grids. They would also make the network companies investigate the possibilities for flexibility and use the capacity of the existing infrastructure.

Anna WernerCEO of Swedish Solar Energy