Speaker of Verhaert at the 8th edition of our Innovation Day on October 21st 2011.

1. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 2
SMART GRIDS: HYPE OR
REVOLUTION?
CONFIDENTI
AL
Erik Van Genechten
Project Manager
Erik.vangenechten@verhaert.com

2. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 3
Presentation Summary
• Transition from conventional power grid to smart grid
• Opportunities for innovation
• Conclusion

3. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 4
The Conventional Power Grid
Electricity production and delivery is monopolistic, central,
conventional (=nuclear or fossil fuel based and hydropower)
and predictable
Electricity flows in one direction, from producer to consumer
(top-to-bottom)
Industrial entity is responsible for
• network extensions iaw. growing demand
• providing security of supply

4. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 5
The Conventional Power Grid
• Network uses tree topology
• High voltage network is operated
by the Transmission System
Operator (TSO) and is used for
long distance power transportation
across borders and state lines
• Medium voltage network is mostly
operated by the TSO and used for
local power distribution.
• Low voltage lines are operated by
the Distribution System Operator
(DSO) and voltages are stepped
down to 380/230V for SME and
residential use

5. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 6
The Conventional Power Grid: Market Liberalisation
(Belgium: 1999-2005)
Power generation, grid operation and
customer care are split over multiple actors:
• Production (Electrabel, etc.)
• Transportation (Elia)
• Distribution, Metering (Eandis/Infrax)
• Balancing responsible (major customer,
producer)
• Regulator (VREG)
• Delivery (ECS, etc.)
• Trading (Belpex)

6. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 7
The Grid becomes smarter
Network topology slowly migrated from simple tree structure to more
complex mesh networks for added redundancy
More complex network structures demand increased control mechanisms
and network communication infrastructure
Market liberalization introduced new actors, requiring better rules of
engagement
Network balancing (demand and supply) was only done by means of
controlling the energy supply, i.e. turning on/off peak power plants
(Gasturbines, pumped storage plants,…)
Complexer
topology
Market
Liberalization
Better Load
Balancing

7. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 8
Residential Consumption: Typical Daily Profile
0
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Today
BAU
hours

8. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 9
Threats to power grid
?Increasing
Demand
Distributed
Generation
Renewable
Energy
Sources
Demand-
Response
Optimization Energy
Storage
Prosumers
Aging
Network

9. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 10
Why do we need a smart grid?
De-carbonization of the energy
March 2007: Ambitious European Energy policy 20-20-20:
• 20% reduction in CO2 emission
• 20% increase in energy efficiency
• 20% of energy produced is renewable (Belgium target is 13%)
RES in Belgium:
• 2005: 2,2%
• 2009: 6,0%
• 2020 target: 13% of energy produced is renewable
Target for 2020
CO2 neutral energy production by 2050
Increased unpredictability of power generation

10. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 11
Smart Grid Functions
• Real time remote metering
• Bi-directional flow control
• Demand-Respons balancing
• Peak shaving
• Time of Use pricing
• Island operation

11. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 12
Residential Consumption: Typical Daily Profile
0
0.5
1
1.5
2
2.5
3
0 2 4 6 8 10 12 14 16 18 20 22 24
Today
BAU
Smart Grid

12. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 13
Smart meter: the cornerstone of any smart grid
EC Directive:
2020: 80% of consumers equipped with Smart meters
Purpose:
Remote real time registration of electricity/gas/water
consumption
Power outtage notification
Monitoring power quality
Interface with Home Area Network
Remote customer activation/de-activation

13. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 14
Smart meter Benefits
Customer:
• Awareness of real time electricity/gas/water consumption
• No more annual meter registration
• Accurate monthly billing
• Faster responses to power outtage
Distributors:
• Automatisation of billing
• Detection of “non-technical losses”
• Faster detection and resolution of power outtage
• Better allignment of generation and consumption of power

14. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 15
Smart meter Benefits
Power generators:
Better prediction of required power to be generated
Balancing the network with increasing DER remains possible
Introduction of ToU pricing for residential market
Aggregators:
Enable energy wholesale to specific markets

15. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 16
Time of Use Pricing
Multiple tariffs
Ratio Highest/Lowest tariff up to 15

16. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 17
Demand Side Management: The hunt for flexibility
• Increasing % of RES in the network means increasing unpredictability in
terms of power generation (e.g. weather dependency)
• The only way to keep the networks in balance, is to also control the
power
• Consumption (= demand side management)
• Power generating companies are looking for flexible customers to
partner with them. The more flexible you are the better prices can be
negotiated
• Different control levels are possible, both on consumption and
generation side:
Power on/off control by third party
Control local power generation remotely
Peak demand reduction
ToU pricing, Real Time Pricing or Bidding

17. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 18
Demand Side Management: The hunt for flexibility
• Air conditioning = solar powered
• Dishwasher
• Dryer
• Cooling/Freezing = cool lower during low tariff periods, improve
hold- over time to overcome high tariff
periods
• Energy storage (electrical/thermal/hydro) = pump water with cheap
electricity, generate power when prices are high
• Water heating
• Space heating
• Hydrogen generation = use wind power when surplus is available
• eMobility = > storage capacity
= allready today often used during night time

18. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 19
Market impact: Business opportunities
eMobility
• One large mobile electrical storage medium
• Flexible charging patterns
• Smart charging infrastructure (public and private)
• Trip planning tools
Home Area Network
Residential gateway
In home displays
Smart appliances
Building/home energy management systems
Micro generation (Solar, wind, WKK, ...)

19. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 20
Market impact: Business opportunities
Shift in energy market
Smart buildings
Selfsufficient neighbourhoods
Smart Cities
Many stakeholders
System operators
Producers
System integrators
Asset owners
Policy, regulations
Customers
No single organization can deliver the smart grid

20. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 21
Smart Grid = Marriage between Utility
and Telecom sector
• Utilities typically installs equipment for 10’s of years, but which
electronic equipment is failsafe for 10 years?
introduction of low cost consumer electronics in
residential meter cabinet
• Millions of smart meters sending out data every 15 minutes
hugh amount of data management requires top notch
telecom infrastructure
• Electrical network security becomes key issue
• Island operation requires specific connectivity and ICT technology

21. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 22
Conclusion
Smart Grid will be the next
industrial revolution after the internet!
Make sure you assess the potential
impact on your business!
Environmental
Concerns
Reneweable
Energy
Smart Grid
Impact on daily
business

22. CONFIDENTIAL
INNOVATIONDAY 2011 Slide 23
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