Increasing Decentralisation of Energy Production – a Challenge for Energy Service Providers

26Jun
2007

Speaker: Dr Werner Brinker, Chief Executive Officer and Chief Officer Sales/Marketing, Gas Procurement & Storage.

Everyone involved in the energy supply business is becoming increasingly aware that we can no longer take our energy supplies for granted. In the future, all available sources of energy, whether conventional or renewable, will have to be used in ways make use of the most climate-friendly and efficient technologies available. A tendency towards a diversification of energy supplies seems probable both in the fields of electricity production and heating, as well as for other areas of energy use.

This new situation will represent a great opportunity for innovative and visionary energy suppliers who will be able to make the most of new market openings. At the same time, this situation will represent an opportunity for the successful implementation of the ambitious European targets on future energy supply.

The aim of this evening’s event was to initiate a debate on how business and political leaders can meet these challenges and turn them into successful outcomes. We discussed the long term strategies that will have to be adopted internationally in order to deal with the changing situation.

In the light of global warming, rising demands for energy supply and decreasing availability of resources, the EU member states agreed on ambitious goals: to reduce their greenhouse gas emissions by 20 percent by 2020. In addition primary energy consumption in the EU is to be reduced by 20 percent by 2020 and, in parallel, the proportion of renewable energies in the energy mix is to increase to 20 percent. A target of 10 percent by 2020 has been set for the proportion of bio-fuels in transport.

Therefore visions for a sustainable energy supply need to be pursued and realised, which leaves no doubt that decentralised supply through alternative energies and technologies is becoming increasingly significant and therewith a comprehensive energy management system that controls and balances the sometimes fluctuating and decentralised feed. But this system must not only balance the complex interaction between energy supply and demand, but also ensure the optimisation and quality assurance of the network infrastructures at the same time.

The 20-percent-target guidelines described are not only being supported by EWE – they are already an essential part of the strategy of the whole Group.

EWE recognised the significance of decentralised plants early on and has already been investing for years in various decentralised supply technologies. Thus EWE is committed to developing solutions for these objective targets, including within the framework of the company‘s own research project (Decentralised Energy Management System, in short DEMS). At this stage more than 10.000 decentralised plants feed into the EWE electricity grid. Those plants will feed into the electricity grids with an upward trend.

DEMS is more than a virtual power plant that brings together a huge amount of consumers and producers. Its primary aims are long term concepts for network integration of a high proportion of decentralised energies. DEMS is consequently an energy management system that optimises the changing supply and demand structure on the energy markets. A market model, such as the DEMS, can optimally coordinate requirements and guarantee network stability and security of supply for the customer.

As the interaction between energy suppliers, customers and network operators continues to develop in a very dynamic process, this has to be taken into account when discussing the subject of ownership unbundling, as this could affect considerably the functionality and efficiency, and even the development of such a system.

A general ownership unbundling as currently under discussion in the European Union would lead to an optimisation of subsystems instead of improving the whole (European) energy system. Ownership unbundling therefore does not meet all the targets of the European Union, on the contrary it would lead to a stagnancy of the further development and enlargement of decentralised energy systems. Furthermore higher costs and a loss of useful synergies would be the consequences of ownership unbundling.

Hence European institutions are asked for support in order to pave the way for a future energy supply by strengthening research and development, building up a reliable legal framework and, last but not least, integrating a broad European civil society into this process.