What makes a smart grid profitable? Dipl. Ing. Hans Schäfers Center for Demand Side Integration, University of Applied Sciences Hamburg

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1 What makes a smart grid profitable? Dipl. Ing. Hans Schäfers Center for Demand Side Integration, University of Applied Sciences Hamburg

2 What makes a smart grid profitable? The current situation? The future problem of the energy turnaround? Two examples for possible profits

3 The current situation

4 What makes a smart grid profitable? The return on investment of smart grids can NOT be given in Euro and Eurocents at present. Dr. Bernd Michael Buchholz, NTB Technoservice, 2nd Chairman FB V2 der ETG Dr. Britta Buchholz, MVV, Head of DAK SC C6 CIGRE Bernhard Fenn, HSE AG, Coordinator EU-Project Web2Energy Proceedings of the European Symposium Distribution Grids of Tomorrow April 2011, Darmstadt, Germany. (

5 What makes a smart grid profitable? At the moment too little revenue * to make it interesting for heavy investment but * In Germany currently 30,- to 45,- /kw flexible power per year, strongly depending on market developments.

6 Smart grids are, today, a challenge to secure the integration of renewable energy sources without reducing the quality of supply. SG are one of the TOP 10 issues for the European Commission. Dr. Bernd Michael Buchholz, NTB Technoservice, 2nd Chairman FB V2 der ETG Dr. Britta Buchholz, MVV, Head of DAK SC C6 CIGRE Bernhard Fenn, HSE AG, Coordinator EU-Project Web2Energy Proceedings of the European Symposium Distribution Grids of Tomorrow April 2011, Darmstadt, Germany. (

7 The political aims concerning the energy turnaround: Europe aims at realizing ist ambitious agenda 20% less energy consumption < 20% 20% less CO2 20% demand coverage by renewable energies Some European countries go further than that: Germany aims at a share of 35% electricity from renewables by 2020, 50% by 2030 and 80% by 2050.

10 The future problem of the energy turnaround

11 Problem: A rising share of renewables leads to higher fluctuations in power generation. Base load as a concept vanishes. Simulation of a share of 47% REG (Weather data of 2007). Source: Fraunhofer IWES

12 Power in GW Resulting residual load (RE generation minus load) expected for 2020 in Germany Plus generation from existing (!) base load PP

and storage of surplus generation Influence of DR and PS

13 Indespensable part of the solution: Smoothing fluctuations via Smart Grids Integration of the Demand Side (Demand Response) and storage of surplus generation Influence of DR and PS (Potential of 2006) at 47% REG (Weather Data 2007). Source: Fraunhofer IWES

14 What makes a smart grid profitable? Two examples for possible profits

15 What makes a smart grid profitable? Two examples for currently possible profits 1: Revenues of Demand Response Integration from Cold Storage Results from the e-harbours show case in Hamburg

16 Survey in Hamburg Land use and identified/analysed companies in the port of Hamburg

17 Closer Examination of 3 cold storage facilities K1: 600 kw (440 kw) cooling power K3: 132kW (100 kw) cooling power K4: 200 kw (180 kw) cooling power Examination of financial potential regarding structured purchase untypical grid usage (low during peak, high during offpeak) selling reserve capacity combination of the above

19 What makes a smart grid profitable? Two examples for possible profits 2: Results from the European Web 2 Energy Project

20 Comparison Source: See next slide. Making use of one business case is not enough. Combination of different business cases needed. Revenues strongly dependent on market conditions as well as (national) rules and regulations. High fluctuation in market developments (Spot Peak, postres vs. negtres ).

Interdependencies Energy (a MWh) can only be sold once. Market participation is interdependent. Flexibility of choice in market participation comes through combination of storage and gen.

21 Interdependencies Energy (a MWh) can only be sold once. Market participation is interdependent. Flexibility of choice in market participation comes through combination of storage and gen. facilities and different sources. Source: hkeiten%20und%20k%fcnftig%20im%20umfeld%20novelierter%20regulierung.pdf

22 What makes a smart grid profitable? Conclusions: Currently obtainable revenues are limited. Adjustments in power market regulations expected to lead to higher revenues for flexibility in power usage and production Time to start your pilot is NOW. Putting up Smart Grids takes some time: Identification of existing contractable facilities Planning/sizing/bulding of new DR, Storage, Distributed Generation facilities Installation of control center Settlement of legal issues (Prequalification etc.)

23 So? What makes a smart grid profitable? Its unique flexibility to put your energy (buying and selling) onto the best available market. Always.

24 Thank you for your attention.

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