INTERVIEW - Digital tools can also support energy permitting, regulation

March 16 (Renewables Now) - Digital technologies are present across the whole energy value chain from the power plants to electricity consumers, helping to optimise assets, reduce costs, improve efficiency and cut emissions. As the energy system becomes more renewable and decentralised there is a growing need for digital tools to facilitate the transition to clean energy. According to Energy Exemplar, they can also help speed up regulation and permitting.

Permitting & policy

Slow permitting is cited as a key obstacle to renewables acceleration in a number of markets especially as the war in Ukraine has underscored the urgency of switching to cleaner and more reliable, domestic energy sources.

David Wilson, CEO of energy modeling software company Energy Exemplar, explains how digital technology can change the pace.

“Any permitting process must assess a wide range of complex factors, including regulatory and technical requirements. These factors could include environmental overlays, such as construction height or land use restrictions, as well as technical questions of network reliability and congestion – in other words, is there enough capacity in the network to move the energy? Many of these processes can, and indeed should, be undertaken using digital technology such as simulation tools. Combining all of them together into a single, automated workflow can quickly yield answers to questions that would otherwise be incredibly time-consuming and disjointed to get,” Wilson says.

When it comes to regulations, one of the core challenges for any regulatory body is to understand the impact of regulatory change, Energy Exemplar’s head points out.

“What are the benefits and costs of any change? Who benefits? Who has to pay those costs? Regulatory bodies have to consider their many (and often competing) objectives and identify what changes they need to make to meet them. Given this, and given the expense, complexity and importance of modern energy systems, it is impractical – and even dangerous – to go out, try different things, and simply see what happens. This is why digital technology is so valuable. Through modelling, regulatory bodies can explore any number of scenarios quickly and then make an informed choice.”

The recent energy crisis is also seen as a chance to speed up the digitalisation of the energy sector.

In a September 2022 report, the International Energy Agency (IEA) said that there is increasing focus on digitalisation in energy policymaking, but more progress is needed. The report meanwhile showed that after a slowdown in 2020, power sector investment in digital technologies increased by around 13% in 2021 to USD?55?billion (EUR 52bn), reaching around 18% of total grid investment.

The European Commission, for instance, in October 2022, alongside emergency interventions in response to high energy prices, adopted an action plan for the digitalisation of energy - “Digitalisating the energy system - EU action plan”. It is welcomed by DIGITALEUROPE, a body for Europe's digital technology industry, which last month highlighted four key accelerators for the twin transition (green and digital) -- data cooperation to enhance access to and use of sustainability data; green network infrastructure to speed up connectivity; investment to boost R&D and innovation in green tech; and enabling regulation to create synergies between digital and green policies.

Balancing

A key role for digital tools in the energy sector is to make possible the integration of increasing volumes of renewable power. Wilson says that there are a number of ways in which digital solutions can help to replace firm capacity.

“First, in understanding the effective capacity of variable renewable resources. We have all heard that the sun does not shine and the wind does not blow all the time, but we can count on getting a certain amount of energy. With sufficiently advanced analytics and the integration of storage, we can determine what effective capacity is, and create the right match.

“Secondly, in making use of flexibility in demand. Not all loads have to happen at the same time. One example is the charging of electric vehicles. As long as you know when the vehicle needs to be charged, you can adjust the charging time so that it aligns with the best availability of energy. That is one small example of an opportunity for orchestration that digital approaches are great at addressing. There are many opportunities of this kind across the industry.”

And hydrogen

The expert is also positive that digital technologies can facilitate the adoption of green hydrogen in the energy mix. “To understand one part of the modern energy system, it is critical to understand the whole picture. So truly to comprehend the opportunities and areas of adoption for hydrogen, for instance, you need an understanding of the energy system that shows when there will be periods of excess or cheap renewables that enable ‘green hydrogen’ to be generated, and when there are substitution opportunities in other industries that dictate the use of that hydrogen.

“The digital technologies now at our disposal allow us to look years into the future and see how the energy landscape will evolve and where critical investment, such as in pipelines or electricity transmission networks, need to be made to make that future a reality.”

(USD 1 = EUR 0.948)