Why Electricity Grids Matter

• Grid Portal
• Grid Group
• All Grid Articles
• Why Electricity Grids Matter?

Why Electricity Grids Matter?

Electricity grids play a crucial role in the decarbonization of power (electricity) because they are the backbone of the energy system, connecting electricity generators and storage to consumers. As we transition to low-carbon energy sources, the electricity grid must evolve to handle the changing nature of electricity generation and demand.

When we talk about electricity grids changing, we include both the practical infrastructure ("cables in the ground") and the conceptual and market-based approaches to electricity usage. As efforts are made globally to decarbonise the generation of electricity, both the nature of new electricity generation/supply (such as renewable energy) and the methods in which we consume power (such as for charging electric vehicles) changes.

Power flows both ways, with the increase of prosumers.

Overall, these changes are encompassed by the concept of decentralisation - this means moving away from a traditional power generation model, where large power stations generate electricity which is then transported one way to electricity consumers. The new model of a decentralised electricity system, means that power travels multi-directionally, and rather than having a few large power generators, we see a growth in electricity prosumers (whom are both power generators and consumers). For example, a home which has solar panels installed on the roof, a battery storage system, and an electric vehicle, can both generate electricity, store it and consume it in larger quantities than homes historically would have.

Decarbonization strategies also often involve electrifying sectors like transportation (electric vehicles) and heating (heat pumps). This increases demand for electricity and requires grids to be robust and scalable.

This creates new challenges for electricity grids, requiring them to modernise both technologically, and economically, to support the development of new markets and services which will offer reliable and resilient management of power.

Technological Aspects of Electricity Grids

Electricity grids must adopt advanced technologies to meet the demands of decarbonization. Key technological aspects include supporting:

• Distributed Energy Resources (DERs): the rollout of distributed energy resources (DERs) or decentralised power generation, such as renewable energy technologies like solar PV, and wind power. As more renewable energy generation comes online, due to the intermittent nature of these technologies, grids should be updated to support new connections to DERs. Dependent on the grid infrastructure these could be connected at multiple levels (for example, at distribution network level, or transmission network level) and grid capacity must be made available to offer new connections.
• Energy Storage & Flexibility: Integrating storage solutions like batteries can assist in managing renewable energy intermittency and support the levelling out of supply and demand, providing grid stability. There are a range of energy storage technologies being deployed, including both short term (such as lithium ion batteries) and long term (such as pumped hydro) energy storage solutions. Adding new connections to power generators can increase the load on local distribution network cables, and even transmission cables will require physical upgrades by adding more cabling, although this is a costly and time consuming process. Therefore, the concept of flexibility can be introduced to support the transition. Flexibility refers to any solutions which enable the grid to manage supply and demand - through utilising energy storage, or reducing or shifting demand through technological or market based incentives.
• Smart Grids: Deploying digital technologies for real-time monitoring, automation, and communication enhances grid flexibility, reliability, and efficiency. The rollout of these technologies will include both software and hardware upgrades, and may also involve varying levels of consumer engagement - for example, the roll out of smart metering in the UK faced both technical and human challenges.
• Cross-Border Interconnections: Planning regional interconnections to share renewable energy across borders and improve efficiency.

Design, Modelling, and Planning of Electricity Grids

Planning and modelling are essential for designing grids capable of supporting a decarbonized energy system. Equally, as power consumption and use changes, models should be able to keep up to date, and can be useful for future forecasting net zero targets and relevant infrastructure upgrades required.

• Capacity Planning: Ensuring sufficient transmission and distribution capacity to accommodate increased demand from electrified sectors like transportation and heating is crucial as behaviours change and consumption of power adjusts. The challenge is to generate not only enough clean power, but to be able to utilise that power to meet demand which involves storing and forecasting accurately when it is likely to be drawn upon.
• Scenario Modelling: Simulating various renewable energy integration scenarios to optimize grid design enable key stakeholders to plan for future energy scenarios. The growth of the artificial intelligence (AI) sector offers new opportunities in digital energy market modelling, and technologies such as digital twins also enable detailed models to be developed of energy systems which allow strategists and analysts to testbed use cases which could offer solutions to technical and market driven challenges.
• Urban Design and Wider Planning Frameworks (Smart Cities): As a central part of the infrastructure of the built environment, grids and access to power also impact wider aspects of urban design. From integrating the development of flexibility services and new grid connections into the existing planning systems managed by local governments or authorities, to developing new grids or micro-grids to enable energy access and electrification of rural areas, power system design and modelling is crucial to the town and city planning, and the development of nations through fair and stable access to power.

Policy and Regulatory Frameworks for Electricity Grids

Strong policy and regulatory frameworks are critical for enabling grid decarbonization. Important aspects include:

• Market Design: Reforming electricity markets to incentivise renewable energy, storage, and demand flexibility.
• Incentives for Innovation: Introducing subsidies and tax benefits for grid modernization and technology adoption.
• Carbon Accounting Standards: Establishing clear metrics to measure carbon reductions achieved through grid upgrades.
• Public Engagement Policies: Engaging communities to build support for infrastructure projects and regulatory changes.

Finance and Funding of Electricity Grids

Securing adequate funding for grid modernization is vital. Considerations include:

• Investment Models: Attracting private and public investments through innovative financing structures.
• Cost Recovery Mechanisms: Balancing grid upgrade costs with affordability for consumers.
• International Funding: Leveraging climate funds and global financial institutions for cross-border grid projects.

Stakeholders and Human Resources for Electricity Grids

Electricity grids involve multiple stakeholders and require skilled human resources:

• Stakeholder Collaboration: Involving governments, utilities, communities, and private entities in grid planning and operations.
• Capacity Building: Training professionals in emerging grid technologies and operations.
• Equity Considerations: Ensuring underserved communities benefit from grid upgrades.

Microgrids

Microgrids are localized energy systems that can operate independently or in conjunction with the main grid:

• Resilience: Enhancing grid resilience by providing backup power during outages.
• Decentralization: Supporting renewable energy integration at the community level.
• Use Cases: Particularly useful in rural or underserved areas where extending the main grid is expensive or impractical.

Impacts, Monitoring, and Evaluation of Electricity Grids

Monitoring and evaluation ensure that grid investments meet decarbonization goals:

• Impact Assessment: Evaluating how grid upgrades reduce emissions and improve energy access.
• Performance Metrics: Establishing KPIs for grid reliability, efficiency, and integration of renewables.
• Adaptive Management: Using data from monitoring systems to continuously improve grid performance.

Case Studies on Electricity Grids

Learning from case studies provides valuable insights for future grid projects:

• Regional Grid Upgrades: Examining successful grid modernization projects in regions with high renewable energy penetration.
• Innovative Microgrids: Analyzing examples of community-based microgrid systems that enhance resilience and sustainability.
• International Interconnections: Reviewing cross-border projects that optimize renewable energy sharing and improve efficiency.

By addressing these topics, electricity grids can transition from their traditional role as passive electricity carriers to active enablers of a low-carbon energy future.