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Scaling-up Power Flexible Communities business models empowered by Blockchain and AI

Periodic Reporting for period 1 - FleXunity (Scaling-up Power Flexible Communities business models empowered by Blockchain and AI)

Reporting period: 2019-12-01 to 2020-11-30

In order to address the global challenges of energy security and climate change, there is a pressing need to accelerate energy transition by increasing renewable energy sources (RES) and shifting towards distributed energy systems. The European Commission targets 45% renewable energy into electricity sector by 2030 and new policies are setting forth new provisions on energy communities to empower them to participate in the market. The efficiency and market value of energy communities’ renewables is higher with an accurate distributed flexibility management. Energy flexibility consists of the empowerment of end users to shift time and limit maximum power they consume. This may be irrelevant for one end-user but strongly powerful for thousands of end-users as a group. However, digital technology is required to optimize supply-demand matching, providing grid stability, and reducing energy costs. There is a lack of tools focused on small loads and with a holistic approach along energy value chain from energy generation to energy consumption.
Transformation of electricity sector has however major challenges to ensure security of power supplies and to add more flexibility from demand side on the system to be able to integrate distributed renewable generation. Huge capacity wind farms or solar plants, but also domestic roof-top solar panels are simultaneously supplying power. In that sense, end-users of electricity are expected to become “prosumers”. But while this is a great opportunity to face increase in electrification and can reduce customer bills, it can create problems for traditional energy generators and grid operators because of renewables intermittency and volatility causing challenges in the power balance.
With smart ICT tools and platforms, aggregators can provide new business models that will contribute to match supply and demand minimizing grid instability and contribute to provide affordable energy to end-users. Energy aggregators could manage “prosumers”, optimize RES generation, integrate energy storage and offer ways to monetize load shift and peak shaving of consumers. The electricity system is experiencing a digital transformation, named “Internet of Energy”. Energy and data need to flow simultaneously in the grid, enabling the smart grids.
To sum up, the big challenge to develop a secure and flexible electricity market in EU is (a) to maximize RES penetration while ensuring grid stability and lower balancing costs, (b) to reduce energy costs for end-users and facilitate self-generation, integrate storage and flexible load management, (c) and thus giving more opportunities to consumers to capture value from their consumption flexibility. Digital tools based on advanced AI algorithms and remote automatization are required to help aggregators and/or retailers to optimally manage all those components, sharing the benefits with energy producers, prosumers, and end-user.
The project addresses the current challenges of managing the variability in renewable generation by using storage and flexible loads and the challenge of enhancing customer empowerment by designing business models that facilitate their participation on markets.
The main objective of the FleXunity project is to develop and validate a Virtual Power Plant (VPP) digital tool based on advanced Artificial Intelligence, remote automatization and blockchain to optimize community energy flexibility, match consumer’s energy needs, ensure further development of RES, optimize distributed energy resources, and contribute to the current energy security and climate change challenges, while enhancing retailers and aggregators competitive advantage.
At the beginning of the project the website and the brand book were developed with all the necessary document templates for reporting and dissemination purposes. The dissemination and communication plans were updated, and activities are ongoing.
An extensive technical and legal requirement analysis was performed, with the main objective of comparing technical and market requirements for demand response (DR) participation in EU balancing markets. The analysis was conducted for the project target countries, namely Finland, the Netherlands, United Kingdom (UK), Spain and Portugal.
A generic market design combining intra-community P2P interactions with aggregated demand response flexibility provision to the external balancing markets under a VPP model has been proposed, and its applicability to the UK and Iberia pilot Energy Communities was briefly discussed.
The aggregation models and scheduling methods were already developed, and the optimization AI algorithms are on an initial stage of development.
The TSO balancing markets requirements for Energy Communities flexibility services and an initial (theoretical) selection of a set of exiting grid support services that can be addressed by FleXunity Flexible have been defined.
All the site surveys and audits have been finished. The project was able to engage and collect the necessary data from all required participants, in order to establish two different Energy Communities pilot sites: a UK pilot comprised by 30 homes (20 homes with PV and 10 homes with no PV) and 4 non-residential sites, and a Iberian pilot comprised also by 30 test homes (20 homes with PV [19 in Spain, 1 in Portugal] + 10 without PV [5 in Spain, 5 in Portugal]) and 6 non-residential sites (4 in Spain, 2 in Portugal). The total aggregated flexibility for the UK pilot is estimated to be around 100 kW and for the Iberian around 418 kW.
The final product of FleXunity is being designed with the main purpose of fulfilling a market need of energy communities’ management, empowering the end users with an intelligent ICT system, easy to use, integrating in the same platform several beyond state-of-the-art technologies. The project is developing and creating new knowledge based on technologies such as big data, cloud computing, IoT, and AI analytics applied to energy data to deliver new added value, delivering consumer empowerment tools that will allow the reduction of energy consumption and carbon footprint by smart and sustainable use enabling energy markets dynamics.
Beyond state-of-the-art activities include the adding of AI algorithms in the VPP platform enabling optimised Flexible Energy Communities with coordinated automated mechanisms to manage distributed energy resources and demand flexibility in real-time, resulting in a predictable and stable outcome. The project follows a unique approach in the market by allowing to monetize flexibility of smaller loads (< 50 kW). As a result, (i) prosumers can optimize availability of renewable resource (ii) energy consumers can optimize their consumption and monetize their flexibility, (iii) energy aggregators and retailers can enhance their flexibility portfolio and reduce imbalance settlements in energy markets and (iv) system operators can improve grid stability and security of supply. In short, FlexUnity creates better conditions for the introduction of new RES into the grid and new tools to support demand following generation market products monetizing flexibility as a tradable asset.