Electricity market

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Fact Theme: Electricity markets. A technological solution for the theme’s key issues. Smart grid opens the door for renewables In tomorrow’s energy vision, consumers produce some of their own electricity and adjust their consumption based on the price of energy. That will require smart electricity networks. Jarno Forssell Tomi Parkkonen Osmo Päivinen A landscape of renewable energy opens up from Fortum’s high-rise in Espoo on a warm summer day. The sun is shining down from a virtually cloudless sky, and the wind is whipping up white caps on the Gulf of Finland. On a day like this, the solar energy plants built atop residential or business buildings could produce more-than-enough energy for self-sufficiency and feed the surplus to the grid for others to use. Germany and Denmark, the frontrunner countries in renewable energy, set an example. Four per cent of Germany’s energy is produced with solar power and six per cent with wind power. In Denmark, wind energy already accounts for 20 per cent. In fact, this is considered the limit for current electricity networks to accommodate conditionbased renewable energy. ”If the desire is to increase the role of renewables from that 20 per cent, then smart grids that enable distributed production, storage and flexible consumption are a necessity,” says Petra lundström, Corporate Technology Officer, Fortum. She says that with smart grids and at favourable latitudes the share of renewable energy forms could climb as high as 50 per cent. ”This kind of vision is significantly more challenging for the overall management of the grid than the current way of operating because the share of steadily running production plants would be smaller. Although, bioenergy produced e.g. at bio-CHP plants is a stable and predictable form of renewable energy.” diStriButEd ProduCtioN aNd StoraGE Smart grids enable a two-way flow of energy. The current system consists of big, centralised production plants that produce electricity for end users. In a smart grid, production is distributed among smaller units – like solar and wind power plants – and consumers too are small-scale producers of energy. The technology for this already exists. ”Solar power technology is advancing at a tremendous pace, and I believe that it will become a big thing globally,” Lundström says. In Italy, for example, installing solar panels on rooftops is financially feasible due to the higher price of electricity. The ability to feed electricity from these kinds of small-scale production plants to the grid for use by others requires not only smart grids, but also changes in the electricity markets. ”Game rules are needed to define the terms by which the grid can be connected to,” Lundström says. Smart grids enable distributed production, storage and flexible consumption. Petra Lundström » 17 Fortum forAgendA

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