The electricity market is changing rapidly because of the energy transition. Alongside the growth in the number of renewable energy sources, fewer conventional power stations will be available in the future to provide the necessary flexibility. As Transmission System Operator (TSO), TenneT is responsible for balancing electricity’s supply and demand on the grid. TenneT is looking for new (decentralised) sources that can offer flexibility, such as batteries, wind and solar energy, industrial installations or cogeneration. Through suppliers and a so-called ‘aggregator’ and blockchain technology, the capacity of all these sources is utilised, and consumers can also participate directly in the energy market, thus contributing to the energy transition.
Last year TenneT launched two pilot projects, where TenneT deploys blockchain technology to use electric cars and household batteries to keep the high-voltage grid in balance, and to prevent congestion on it. The blockchain implementation was developed by IBM. The Netherlands is working with sustainable energy supplier Vandebron, while Germany works with Sonnen E-services.
How it works
Vandebron gives TenneT the flexibility to maintain the balance. Vandebron does this by temporarily interrupting and restarting the charging sessions of customers with electric cars – at TenneT’s request. Vandebron facilitates this ‘smart charging’ service for the Tesla drivers, who also receive a fee for this. Details about their participation, such as the smart charging sessions for example, can be followed via an app.
In Germany, decentralised household batteries from Sonnen E-services are integrated into the TenneT network via the blockchain. Sonnen interconnects the household batteries digitally. By then using these batteries smartly, Sonnen contributes to solving transport problems in Germany. The north of Germany has a large amount of installed wind energy, while a significant part of the consumption occurs in the south. A lack of transport capacity between the two regions causes congestion in the electricity grid.
Pilot blockchain projects successful
A total of several hundred home storage facilities were involved in the project and helped to compensate for bottlenecks in the electricity grid.
The Vandebron pilot project can also be regarded as a success. Fardau van der Galiën, Head of Electric Mobility Vandebron: “Now with over 150 Teslas, we make bids every day on TenneT’s regulating and reserve capacity market, and our bids are actually activated by TenneT. This way we are already contributing to maintaining the balance of the electricity grid in real time. Right now it’s only possible with Teslas, but we’re also working on enabling smart charging via the charging station. When that happens one is no longer dependent on the type of car, and we can scale up further. That will make smart charging possible for anyone with an electric car!”
Following an extensive tender, TenneT has now signed a contract with IBM as a partner for the blockchain technology. After the two successful pilots, TenneT and IBM will scale up implementation so that many more parties can be granted access to the electricity market. The market parties involved in this next phase are ENGIE, Escozon & Energie Samen, Scholt Energy & Enervalis and Vandebron. These aggregators will provide flexibility (in the form of aFRR, or power regulation) to the electricity system with various types of assets. Blockchain technology will facilitate the necessary data exchange for this.
Scholt Energy CEO Rob van Gennip: “Scholt Energy has gained a great deal of experience in recent years in the field of energy storage and smart management of supply and demand. Together with our large business customers, who have flexibility in their power consumption, we want to contribute to the energy transition while at the same time creating an extra revenue model for these customers.”
Escozon Director Dominique Doedens: “We are always looking for new opportunities to make local energy initiatives with enthusiastic citizens both future-proof and profitable. For example, the Endona cooperative with gridFlex is developing a smart grid in the village of Heeten in Salland, and the search has begun to realise business models. With the demand for aFFR, TenneT offers a great opportunity for involving citizens with solar farms and wind turbines. And we want to achieve this together from Escozon and Energie Samen.”
Leo Dijkstra, Blockchain lead IBM Benelux: "The energy transition is one of the greatest challenges of our generation. The major disadvantage of solar and wind energy is that it is less predictable. When the sun doesn’t shine or the wind doesn’t blow, less energy enters the electricity grid, and the supply becomes less predictable. Alongside new, cleaner energy sources and more conscious use of energy, blockchain will play an important role and digital technology will become one of the unexpected drivers of the energy transition.”
TenneT CEO Manon van Beek: "As a grid operator, we have a new way of integrating decentralised sources of electricity better, while at the same time securing the power supply. We are also offering private individuals a good opportunity to participate actively in the energy transition, making the energy transition more affordable together.”
What is an aggregator?
An aggregator ensures a better match between electricity supply and demand. Particularly with an increase in solar and wind energy, (on summer days) there will be an oversupply on the electricity market. The problem of oversupply or shortage is that it causes an imbalance on the grid. Network operators have a statutory duty to safeguard the network balance. One way of doing this is to ask customers to postpone their energy consumption (temporarily) at off-peak times, or to purchase extra electricity from the grid at peak times. The aggregator can respond to this by bundling and managing the supply and demand flexibility on behalf of a group of households and companies, and by offering aggregated flexibility in a flexibility market. An example would be greenhouses or cold stores that could possibly postpone their energy consumption for some time, without this having an immediate major impact on the available temperature (which may well drop/increase a few degrees without this spoiling production).