Vers un Reseau Electrique Decentralise et Intelligent Accenture at the intersection of Business and Technology The trend I am going to present is the perfect example of that Vers un Reseau Electrique Decentralise et Intelligent Marion Mesnage – Accenture Technology Labs Copyright © 2007 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Les leviers technologiques et économiques Les étapes pour y arriver Plan La vision long terme Les leviers technologiques et économiques Les étapes pour y arriver Copyright © 2007 Accenture All Rights Reserved.

Vers un système de production decentralisée? vs. Réparti * Today’s electrical system is largely relying on large-scale production and central distribution. This model emerged in the fifties, where a unique provider had to send power straight to all the users. As market are liberazing, the existence of multiple providers makes it more complex. For economical and environmental reasons as well, this model may reveal itself no longer optimal under today’s conditions. And So Some players are now looking at Distributed Generation (DG) as a new model to produce and deliver energy. The benefits of Distributed Generation usually advanced include: An increased efficiency with reduced transmission losses, the possibility to exploit heat wastes (via co-generation) and to match demand to supply more closely. A better reliability, since production is done near demand, and is less impacted by grid congestions or natural disasters . A better scalability, especially in dense area where it is difficult to build large power plants and install new transmission lines. Smaller environmental impact - renewable sources such as solar and wind being by nature distributed The common belief, however, is that centrlaised power remains a more cost effective option. This is starting to be argued as well: while the cost of producing power at a large scale is still much lower than producing it at a small scale, there are a number of costs associated with the operation and maintenance of a heavy tranmsision network, that do not exist when the production is connected directly to the distribution system While the benefits of distributed generation are now acknowledged by some key institutions, it is also clear that its implementation from the current centralized system represent an enormous challenge. Plus efficace Plus fiable Plus facile a deployer a grande echelle Impact CO2 moindre Moins cher? Copyright © 2007 Accenture All Rights Reserved. Source: “Small is Profitable”, A. Lovins et al.,

La demande comme une ressource distribuée Demand-Response: mécanismes de gestion de la demande des utilisateurs en réponse aux conditions d’offre, par exemple, inciter les utilisateurs a réduire leur consommation pendant des périodes critiques ou en réponse au prix du marche en temps réel Copyright © 2007 Accenture All Rights Reserved.

Vision : Vers des réseaux décentralisés intelligents An active house Vision : Vers des réseaux décentralisés intelligents BP gas station active buys/sells active 4TimeSquare Active User We think the change could be even more pervasive than that. We believe virtually every electricity consumer could become a producer of electricity as well, a producer-consumer , a “prosumer” as we will call them in the rest of the presentation What is a prosumer?: End-user premises (domestic, end-user premises (domestic, commercial or industrial) which has distributed generation and/or flexible loads Able to adjust its/consumption and/or production of electricity, in response to grid condition People still need electricity to use it locally, but they can also decide to make their Watts (or their Negawatts, i.e. what they do not consume) available to the grid if it makes sense economically This is going to be decided via some optimisation mechanism, like auctions and markets, whichh will serve as mechanisms to manage supply and demand in real-time across the grid this is an ultimate vision of a decentralized system, where the generation is not only the business of some proffessional providers, but the virtually the business of every-one We can see this as people like you and me, not proffessional, who will contribute their resource to the greater good, and where Each producer-user on the network can make its energy resource available to other, and use resource which others have made available. The producer-users can be viewed as part of a collaborative network where surplus energy produced at one node is made available to the other nodes in real-time. What is interesting about this: it turns passive consumers into active participants in the energy system and clearly, producing your own power, with the possibility to sell it to others, is an excellent incentive not to waste power. In addition, the Production at Producer-User site is dimensioned to fit the requirement of the end-use, Scalability: demand and supply are increasing at the same time, load on the grid is minimized. The network of producer-user is collaboratively minimizing waste of resource by making sure their surplus will be available to others. So what is the factor these producer would take… googlePlex (project) active active Smart Networks of Active Users Copyright © 2007 Accenture All Rights Reserved. Wal-Mart’s Store in McKinney, Texas

energy box Scenario 2020 (1/2) Scenario 2020 2020: Olivier and Sonia Charpentier have recently decided to change their electricity provider They have chosen « Powenture », a new entrant on the market since market opening in 2007, who proposed a « green » contract, which addressed their will to reduce their CO2 print. The contract comprised: the installation of photovoltaic panels on their roof the replacement of their old furnace by a Combined-Heat and Power unit – which in addition of producing hot water for centralheating and domestic needs, also generates electricity the installation of a battery in the cellar The installation of contrôle modules on their air-conditionning system The material does not belong to the Charpentiers. It is managed by their provider, via their « energy box «  , the gateway for energy services The electricity produced locally is used for the house, and the surplus is sold back to the grid The Charpentiers can access on the Internet to the detail of their consumption, their net consumption, and the amount of CO2 they managed to save Copyright © 2007 Accenture All Rights Reserved.

Scenario 2020 (2/2) Scenario 2020 Powenture manage the electricity production of the entire neighboorhood. They aggreagte and sell the kWh produced by their customer on the electricity market. They manage the devices that are ocated at their customers depending on the fluctuation of the electricity market During the summer, it also happened that following a forest fire, some transmission lines werebroken. In order to The price of energy is slightly higher than what they used to pay with their previous provider, but Powenture garanteed that the price won’t increase within 20 years, and besides, after 5 years, they will own the material and will be able to benefit from the profits of selling the surplus power. Copyright © 2007 Accenture All Rights Reserved.

Les leviers technologiques et économiques Les étapes pour y arriver Plan La vision long terme Les leviers technologiques et économiques Les étapes pour y arriver Copyright © 2007 Accenture All Rights Reserved.

Un modèle rendu possible par les NTIC On the technology side: - We have the « Object Internet » trend, the expansion of Internet to all sort of objects: - sensors, tags and other internet-connected devices - driven by the miniaturization of computers, expansion of wireless data networks and cost reductions in general technology.  Imagine: objects surrounding us have an IP address and they can talk (I am there, I can sense that the temperature outside is such and such, I have a problem ) or receive instructions (do this, do that…) - As a business, if ou use this “Object Internet” properly: you can get real-time and continuous visibility of the physical world, and get competitive advantage of that - Realization of those advantages requires first identifying the business opportunities for these new technologies and then integrating them into existing IT systems – creating a new set of challenges for IT organizations. L’Internet des Objets : l’extension de l’Internet a toute sorte d’objets, d’appareils ou de machines – qu’ils soient fixes ou mobiles, même partiellement. Copyright © 2007 Accenture All Rights Reserved.

L’Internet des objets appliqué … à une ampoule! « je suis éteinte » « je marche a 60W » « je suis grillée » « allume toi » « éteint toi » « baisse toi » Imagine every light bulb connected to the electrical grid becoming intelligent and able to talk. What would such an intelligent lightbulb say: What could you tell to an intelligent light bulb ? The next questi is Can you make an intelligent talking light-bulb? The answer is yes. Thanks to this little device… and this one. Copyright © 2007 Accenture All Rights Reserved.

… et a toutes sortes d’autres objets du réseau électrique Appliances and Loads Micro-generators Energy Storage Meters, switches, and power electronics There are many more objects that can be made intelligent All sorts of otehr appliances and loads: air conditionning and heating systems, washing machines and other appliances, public lighntnings, TVs, etc… to which you can say « turn yourself down » or « reduce your consumption » Micro-generation devices, as opposed to « big generation plants » that today produce power for grids, such as « a fuel cell », or gas-fired micro-turbine, a Combined Heat and Power . Whta is this? It is a boiler, which works using gas, and in addition to producing heating water, it prooduces electricity – as a bonus, that you can either use for your needs or sell back to the power grid. To such device you can say « turn yourself on » when you need more power, or turn yourself down » when you don’t need it anymore Energy storgae :battery -> store energy and tell them to release power when you have a critical need for it. The last calss of objects that would gain to be made intelligent: all sorts of meters and power electronics across grid: to sense power, frequency, and fluctuation and ensure the grid is always healthy and prevent black-outs The emergence of small-scale, off-the-shelf, clean and affordable home-type generation device. Already, small scale resources such as photovoltaic arrays, wind turbines, reciprocating engines, fuel cells, stirling engines, and gas-fired microturbines exist today. at this point, these technologies are neither mature or cheap enough to fulfill these requirements, but if mass producing some of these could cut the costs significantly and the economy of scale could shift from production of electricity to production of generation devices for the masses For example, WhisperTech has just announced the production of 90000 WhisperGen (cf picture on the right of the box), devices about the size of a washing machine. It can be installed in a home and uses natural gas to produce electricity while it is heating water. The units are capable of heating a family home through a network of water filled radiators -- but they generate surplus energy for other household uses, as well. Just replacing the tradional boilers of European homes by this would provide 60GW or equivalent to the nuclear capacity in Germany and UK together. “Plug and play” interconnection with the electricity grid Second, In order to allow on-site generation being exchanged between peers, the integration to the P2P energy network has to be made easy. The traditional power distribution systems were not designed to accommodate two-way flow of power from active generation, and the technical issues associated with this type of operation are significant. again, We are seeing interconnection technologies and standards emerging, which makes it possible to envision ‘plug&play’ connection to the grid. Energy Routers A third enabling technology is FACTS (Flexible AC Transmission System), some devices developed by the Electric Power Research Institute (EPRI). In a peer-to-peer energy marketplace, FACTS will allow power being sent along "transactional pathways", rather than just down the paths of least resistance. One can think of FACTS controllers as routers, capable of routing energy like files in the Energy Web. According to EPRI, FACTS controllers are after nearly 20 years of R&D finally beginning to enter the power grid. These FACTS or similar solid-state device should progressively replace the traditional electromechanical switches in the grid. Energy Storage One could not imagine an Internet peer-to-peer file sharing system if the memory of the computer was either limited or difficult to access. Flexible, efficient energy storage is a very important element of the peer-to-peer energy system. It will ensure that the resource that peers are making available to the grid is reachable quickly and in a predictive manner. It represents a necessary buffer between the effective supply which can be sporadic (solar, wind) or heavy to operate, and the demand. Several energy storage technologies targeting different applications, storage capacities, and duration are under development. Reversible fuel cells are among those, with promising efficiency, and modularity (from a few kW to tens of MW). (1. Intermagnetics General Corporation (IGC)'s 6 Mega Joule, 750 kilovolt amperes, IPQ-750, alternating current Micro-SMES Internet-like grids: and finally, along these energy technologies that I have just described, ICT is a key enabling technology: each node of the peer-to-peer network, be it a generation, a router, a storae or the interface with the grid, have to incorporate some intellience, and communicate with each other, in order to collaborate and exchange energy in a way which is mutually beneficial. The last part of my talk is meant to illustrate in a more detailed manner the role of ICT in such system Copyright © 2007 Accenture All Rights Reserved.

Leviers économiques : fortes pression sur les réseaux électriques Growing Demand Impact of CO2 Emissions Increasing Dependency Geo-strategic Pressures On the business side, we have an interesting trend in the energy sector, which is submitted to very high pressures: Global energy use has been increasing and is projected to keep on increasing: the global demand for energy could increase 66% from now to 2030, requiring the equivalent of a nuclear power unit every two days., half of which in developing countries. at the same time, our dependency on high quality power is increasing, as we become more and more digital. Today, a power failure of 5 min in a company server system can have an enormous cost not talking about critical service in hospitals, police stations, etc.. Deregulation of electricity and gas market is also casting many uncertainties on the business Fossil energies represent 90% of total energy consumption and are therefore the keystone of the system. Emissions linked with massive burning of hydrocarbons is starting to have an impact on the global climate, Power plays for hydrocarbons stocks and/or nuclear know-how are shaping most of the global geo-political landscape Threat of reserve exhaustion, that some experts predict as soon as 20 years from now Experts agree that the current energy system is leading to a dead-end, with potentially drastic consequences at stakes, on economical, political and geo-political, societal and environmental level. It is becoming urgent to change the way we produce and use energy At Accenture we believe Information Technology can contribute to changing the way we produce and use energy. Market Deregulation Reserve Exhaustion Copyright © 2007 Accenture All Rights Reserved.

Les leviers technologiques et économiques Les étapes pour y arriver Plan La vision long terme Les leviers technologiques et économiques Les étapes pour y arriver Copyright © 2007 Accenture All Rights Reserved.

De Hors-ligne a En-Ligne De Uni-Directionnel a Bi-Directionnel Les étapes, en synthèse De Hors-ligne a En-Ligne De Uni-Directionnel a Bi-Directionnel De Centralisé à Distribué utility customer kWh & info Copyright © 2007 Accenture All Rights Reserved. Source: “Small is Profitable”, A. Lovins et al.,

1. De Hors-ligne a En-Ligne Description: La consommation précise des utilisateurs est envoyée en temps réel au fournisseur d’électricité, grâce a un compteur intelligent [Automated Meter Infrastuctures (AMI)] Status: En cours A développer: outils pour transformer les données des compteurs en bénéfices tangibles Meter Communications Infrastructure1 MDMS Wide Area Network (WAN) Telemetry Interface Unit (TIU)2 Local Area Network (LAN) Meter Collector Head End MDMS Lower your costs (manual reading etc..) Very fine granularity (improve Copyright © 2007 Accenture All Rights Reserved.

2. De Uni-Directionnel a Bi-Directionnel Description: L’utilisateur reçoit un signal simple de son fournisseur d’électricité ou du réseau (par exemple prix temps réel) Le consommateur ajuste sa consommation en réponse a ce signal Status: Pilotes A développer: Appareils intelligents (Electroménager, etc…) Plateformes M2M pour interconnecter ces appareils Stratégies d’optimisation: confort vs. cout Pilots: gridwise: 112 homes, heating system -> 10% on energy bills, peak demand reduced by 15% Copyright © 2007 Accenture All Rights Reserved.

3. De Centralisé à Distribué Description: Nombre important de consommateur « actif » L’offre et la demande sont gérée au niveau du réseau de distribution La production d’électricité se « virtualise » Status: Preuve de Concept établie dans les labos La génération distribuée décolle (mais pas gérée) A développer: Intégration de la production repartie (micro réseaux) Stratégies et algorithmes de contrôle Business modèles Copyright © 2007 Accenture All Rights Reserved.

Pourquoi Accenture s’intéresse ce domaine? Revendeur d’électricité Electricity Users New assets? New services? devenir des « active users» réduire leur facture énergétique (augmenter leurs revenus) offrir des services a valeur ajoutee a leurs clients faire levier sur leurs « active users » pour se positionner au mieux sur les marches faire levier sur les « active users » pour opérer les réseaux de façon efficace et fiable Operateur du Réseau de Distribution Copyright © 2007 Accenture All Rights Reserved.

Conclusions A change of paradigm in the way power is used and produced Accenture vision: electricity users will move from passive members of the grid to « active » prosumers of electricity « the Internet of objects » as a major enabler This change is going to happen in 3 « waves » Our clients are going to be impacted at various level (electricity retailers, distribution system operators, electricity users) Accenture is incubating assets to prepare for the change Copyright © 2007 Accenture All Rights Reserved.

Vers le Peer-to-Peer energetique? "There is no reason anyone would want a computer in their home." Ken Olson, president, chairman and founder of Digital Equipment Corp., 1977 Copyright © 2007 Accenture All Rights Reserved.