Impacts of Smart Grid Concept on Energy Industry
Affiliation(s)
Department of Economics, Management and Humanities, Czech Technical University, Prague, Czech Republic.
Department of Economics, Management and Humanities, Czech Technical University, Prague, Czech Republic.
ABSTRACT
Smart grid (SG) is a term that has recently become widely discussed along with the boom of renewable resources (RES-E) and with brand new approach to energy industry. Such phenomena are results from CO2 emissions mitigation and fight against global climate change, as it is discussed e.g. in [1]. Most of the RES-Es work on principles that do not enable the control of their generation. This fact impacts massively on the electricity grid. It is publicly known that the relatively massive development of non-manageable resources, along with the long-term increasing of energy demand, puts higher and higher requirements on the transmission system’s transport capacity. This problem becomes more visible e.g., with future plug-in electric vehicles (PEV) or local renewables (RES-E) expansion. Task for today’s engineers is to solve the sustainability of energy industry. The smart grid concept provides one possible way. Our paper therefore discusses main aspects of SG implementation, which are not often publicly discussed. Our paper describes SG concept that compiles with approach to the decentralized power industry, together with nodal prices occurrence. The local congestions in the grid as well as growing amount of consumption (connected with electric vehicles expansion) and local micro-generation can result in the price nodality. Therefore electricity price can differ according to local conditions from price in global grid. The mathematical description of conditions influences grid nodality follows. In the end of the manuscript, the new way of electricity pricing is proposed.
Smart grid (SG) is a term that has recently become widely discussed along with the boom of renewable resources (RES-E) and with brand new approach to energy industry. Such phenomena are results from CO2 emissions mitigation and fight against global climate change, as it is discussed e.g. in [1]. Most of the RES-Es work on principles that do not enable the control of their generation. This fact impacts massively on the electricity grid. It is publicly known that the relatively massive development of non-manageable resources, along with the long-term increasing of energy demand, puts higher and higher requirements on the transmission system’s transport capacity. This problem becomes more visible e.g., with future plug-in electric vehicles (PEV) or local renewables (RES-E) expansion. Task for today’s engineers is to solve the sustainability of energy industry. The smart grid concept provides one possible way. Our paper therefore discusses main aspects of SG implementation, which are not often publicly discussed. Our paper describes SG concept that compiles with approach to the decentralized power industry, together with nodal prices occurrence. The local congestions in the grid as well as growing amount of consumption (connected with electric vehicles expansion) and local micro-generation can result in the price nodality. Therefore electricity price can differ according to local conditions from price in global grid. The mathematical description of conditions influences grid nodality follows. In the end of the manuscript, the new way of electricity pricing is proposed.
Cite this paper
M. Adamec, P. Pavlatka, M. Kloubec and O. Stray, "Impacts of Smart Grid Concept on Energy Industry," Technology and Investment, Vol. 4 No. 3, 2013, pp. 179-189. doi: 10.4236/ti.2013.43021.
M. Adamec, P. Pavlatka, M. Kloubec and O. Stray, "Impacts of Smart Grid Concept on Energy Industry," Technology and Investment, Vol. 4 No. 3, 2013, pp. 179-189. doi: 10.4236/ti.2013.43021.
References
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[1] C. W. Gellings, “The Smart Grid: Enabling Energy Efficiency and Demand Response,” The Fairmont Press, Lilburn, 2009. [2] E. Sauma and S. Oren, “Do Generation Firms in Restructured Electricity Markets Have Incentives to Support Social-Welfare-Improving Transmission Investments,” Energy Economics, Vol. 31, 2009, pp. 676-689. doi:10.1016/j.eneco.2009.01.015 [3] X. Zou, “Double-Sided Auction Mechanism Design in Electricity Based on Maximizing Social Welfare,” Energy Policy, Vol. 37, 2009, pp. 4231-4239. doi:10.1016/j.enpol.2009.05.019 [4] M. Adamec, P. Pavlatka and O. Stary, “Costs and Benefits of Smart Grids and Accumulation in Czech Distribution System,” Energy Procedia, Vol. 12, 2011, pp. 67-75. http://www.sciencedirect.com/science/article/pii/S1876610211018376 [5] PVGIS Model. http://sunbird.jrc.it/pvgis/apps/pvest.php?lang=sk&map=europe [6] Press Release by CEPS (Czech Transmission System Operator). www.ceps.cz [7] M. Adamec, P. Pavlátka and O. Stary, “Costs and Benefits of Smart Grids on Liberalized Markets,” Journal of Electronic Science and Technology, 2012. [8] F. Vanek and L. Albright, “Energy System Engineering,” McGraw-Hill, New York, 2008. [9] M. Nooij, B. Baarsma, G. Bloemhof, H. Slootweg and H. Dijk, “Development and Application of a Cost-Benefit Framework for Energy Reliability Using Probabilistic Methods in Network Planning and Regulation to Enhance Social Welfare: The N-1 Rule,” Energy Economics, Vol. 32, 2010, pp. 1277-1282. doi:10.1016/j.eneco.2010.06.005 [10] Ch. Liu, Q. Zeng and Y. Liu, “A Dynamic Load Control Scheme for Smart Grid Systems,” ICSGCE, Chengdu, 2011, pp. 27-30. [11] Methodology Used in CEZ Group (Largest Czech Energy Industry Group Owning Generation, Distribution and Trading). [12] F. Fencl, “Distribution Devices. Script CTU (Czech Technical University),” Prague, 2000. [13] R. Walawalkar, S. Blumsack, J. Apt and S. Fernands, “An Economic Welfare Analysis of Demand Response in the PJM Electricity Market,” Energy Policy, Vol. 36, 2008, pp. 3692-3702. doi:10.1016/j.enpol.2008.06.036 [14] F. Leuthold, H. Weigt and C. Hirschhausen, “Efficient Pricing for European Electricity Networks—The Theory of Nodal Pricing Applied to Feeding-In Wind in Germany,” Utilities Policy, Vol. 16, No. 4, 2008, pp. 284-291. doi:10.1016/j.jup.2007.12.003 [15] M. Adamec and O. Stary, “Smart Technologies Implementation into the Energy Industry,” The Future of Energy: Global Challenges, Diverse Solutions, Cleveland, IAEE, 2010. [16] P. Rafaj and S. Kypreos, “Internalisation of External Cost in the Power Generation Sector: Analysis with Global Multi-Regional MARKAL Model,” Energy Ploicy, 2006. [17] M. Junginger, W. V. Sark and A. Faaij, “Technological Learning in the Energy Sector,” Edward Elgar, 2008. [18] R. Webster, “Can the Electricity Distribution Network Cope with an Influx of Electric Vehicles?” EA Technology, Capenhurst, Chester, CH1 6ES, 1999. doi:10.1016/S0378-7753(98)00262-6 [19] REMODECE Project Data. http://remodece.isr.uc.pt/ [20] A. Pina, C. Silva and P. Ferrao, “The Impact of Demand Side Management Strategies in the Penetration of Renewable Electricity,” Energy, Vol. 41, 2012, pp. 128-137. doi:10.1016/j.energy.2011.06.013 [21] R. Weron, “Modeling and Forecasting Electricity Loads and Prices,” The Wiley Finance, 2006. [22] E. Blokhuis, B. Brouwers, E. Putten and W. Schaefer, “Peak Loads and Network Investments in Sustainable Energy Transitions,” Energy Policy, Vol. 39, No. 10, 2011, pp. 6220-6233. doi:10.1016/j.enpol.2011.07.021