Innocent Kamwa
Over the last few years, I have usually started any keynote I have been invited to give with a pitch about the 4D transformation of the electric energy industry toward “decarbonization, digitalization, decentralization, and democratization.” While most agree on the first three Ds, some energy specialists simply ignore the last D, while others give it another meaning like “diversification.” Deloitte Canada states that diversity and redundancy in energy supply chains aim at ensuring reliability and resilience of the electrical system. In my case, and I share this viewpoint with many, the last D means “democratized,” defined as follows: “Consumers are increasingly empowered to challenge the status quo.” So, the power will be turned to the consumers? Really? Based on the findings in this issue, empowering the consumers by opening the retail market to competition has generally resulted in mixed results if not failures.
In This Issue
The electricity market, which has long been lopsided, has hit a bottleneck in responding to new goals such as decarbonization. It is a consensus that unlocking end-user flexibility is the key to changing this situation, which means end users must have sufficient rights to participate in the electricity market.
Opportunities often come with challenges. Devolved power inevitably needs to be accompanied by sound mechanisms for regulation. Therefore, this issue with seven articles focuses on regulatory regimes, market tools, and solutions to promote consumer empowerment based on the practical experiences of various countries.
In the “In My View” column [A1], Jaume Loffredo describes the European Union’s experience and lessons learned in consumer empowerment and discusses the critical steps needed to ensure consumers actively participate in the electricity market.
The first article, by Stephen Thomas [A2], presents valuable lessons from the United Kingdom to discuss the obstacles faced by fully competitive electricity market reforms in the United Kingdom, especially involving competition. It provides a reference for countries in the process of retail liberalization.
The second article, by Cunha et al. [A3], provides a broader discussion of the Brazilian circumstances, constraints, and successes in achieving retail market liberalization that can apply to many middle-income countries facing similar challenges.
The third article, by Nicolò Rossetto [A4], focuses on the energy communities explicitly mentioned for the first time in the new European legal framework. The author summarizes why European policymakers decided to promote the emergence of an energy community, analyzes the similarities and differences between citizen energy communities and renewable energy communities, and illustrates the emerged critical issues and the opportunities that Europe’s current energy crisis may represent.
The fourth article, by Ellen Beckstedde and Leonardo Meeus [A5], points out the congestion problems that result from new grid users, such as electric vehicles or renewable energy, connected to the distribution network. With a focus on Europe, the authors explore the demand, organization, and openness issues of distribution network congestion management.
Unlocking the full potential of bottom-up flexibility for electricity consumers can help move toward a low-carbon energy system. The fifth article, by Avramidis et al. [A6], discusses the challenges and potential solutions for consumers to actively contribute to a low-carbon energy system, focusing on the chain of improving sustainability: pure consumers, passive prosumers, smart and sustainable buildings, local energy communities, and finally, smart sustainable distribution grids underpinning a clean energy transition.
Integrating demand resources adds complexity to the design of capacity mechanisms. The sixth article, by Rodilla et al. [A7], defines a comprehensive framework for the participation of demand resources in capacity mechanisms, identifies all potential participation modes, highlights the inefficiencies that could arise from certain designs, and makes regulatory recommendations.
The lack/insufficient availability of long-term hedging in the power market has led to the current affordability issues in Europe. The last article, by Tim Schittekatte and Carlos Batlle [A8], explains how to proactively mitigate affordability concerns by complementing the long-term market. The authors recommend adding affordability options to the long-term market and explain how to procure these options within the current regulatory framework.
—Yanli Liu
The residential consumer does not understand enough about the market-based price mechanisms to benefit from the competition when multiple choices exist. The government is also keen to play the role of a grandpa, not refraining from disrupting the market by forcing postage stamp rates across the board or capping any price spiraling out of control. In my service territory, the law was to let the price follow the inflation, which was an incentive to install self-generation as a shield from future electricity price increases. Suddenly, the government changed the law to cap the increase to 3% after the inflation exceeded 6.5% last year. This situation is not unique. As shown by an article in this issue, from 2021 to 2023, European governments earmarked and allocated up to 8% of their gross domestic product to shield households and industry from high energy prices. Again, the power is not in the hands of the customer but in those of the government. To hedge against this sudden energy pricing turmoil, without disrupting the spot price signals, the authors of an article in this issue propose a new financial instrument, called “affordability options,” as a complement to long-term markets.
Regarding self-production, we have learned promising stories from Australia, Germany, or California in the United States. The high cost of electricity in certain areas of those countries, combined with government financial incentives for decarbonizing electricity, has made the rooftop solar photovoltaic a no-brainer choice for customers seeking affordable green electricity. This situation has brought the penetration rate of intermittent renewable resources to +50% at times, with the side effect of negative wholesale electricity prices or green energy curtailment becoming a major issue. With a holistic viewpoint, Enedis, the French distribution system operator (DSO), published a few weeks ago a new five-year network development plan. It focuses on “electric sobriety, clean mobility, acceleration of renewable energies, and self-consumption.” This DSO reported a minimum reliability score of 99.9% (i.e., a time period with no service interruption), while the average reliability stands at 99.99%. Empowering the consumer should not come at the price of reducing the remarkable level of reliability and resulting comfort to which we are accustomed. A paper in this issue has termed this tradeoff “fit-and-forget” versus “flex-and-regret.”
In this same context, there is an interesting experiment going on in the sunny Mediterranean in the south of France, with the romantic name of “Solar Social Club” (http://www.sunleavs.com): you can produce your solar energy, share it with the members of your Solar Social Club, and consume your own energy. This concept is essentially a use case for the energy community described in one of the articles of this issue. Thanks to a sensor associated with a Solar Social Club, a real social network between inhabitants of the same district, spanning not more than 2 km and sitting on the low-voltage side of the grid, allows the consumers to better manage energy consumption and create links with neighbors. Connected between the meter and the electrical panel of the home, the individual sensor allows for real-time monitoring of the consumption and energy distribution in different appliances. The data collected allow the dynamic distribution of the self-generated local electricity, between each member of the Solar Social Club, while still being connected with the main grid for energy security and power balancing.
Another advantage is virtual storage; for example, during vacation, the solar energy produced is stored virtually (consumed by the neighbor, in fact) and is returned to the homeowner when needed. A kind of transactive energy optimized at the district level, which may include building automation and energy management systems, leads into a broader discussion underscored in one of the papers in this issue: not only “what the building can do for the network” in terms of grid services, for example, but also “what the building can do for the people in the district” by giving back the economic efficiencies, achieving the feeder-level resiliency of their energy provision under harsh climates hazards, and more importantly, rewarding the community’s efforts toward a green society.
This long overdue issue on markets and regulatory designs and experiments to put more power in the hands of the consumer addresses all facets of the problem, considering the return of experience from a representative subset of jurisdictions around the world. In Europe, the recent focus on energy communities (Figure 1) is highlighted by two papers that address their barriers and enablers from both the smart building integration and regulatory viewpoints with the recourse of research and field experience. The integration of flexibility in the planning tools of DSOs to achieve the same reliability level while enhancing resiliency in the face of more frequent climate hazards is discussed in another paper and in the “In My View” column. The after-the-fact analysis of the retail market liberalization in Great Britain, the bellwether of this trend, will convince several public energy commissions worldwide to stick with their postal stamp tariffication approach and leave their citizens outside market-based dynamic pricing. It is time for further studies.
The case of Brazil is also interesting as a social laboratory where energy poverty, large centralized generation from cheap hydro, and a new appetite for distributed energies are mashed up to create a difficult market design environment. When you try to empower some consumers, usually the richer, you risk doing that by putting the cost on another, sometimes the vulnerable, reinforcing social inequalities and energy justice problems. This situation is no longer an engineering problem, of course.
Vice President of IEEE Power & Energy Society (PES) Technical Activities Dr. Hong Chen also serves as the chair of the PES Technical Council and oversees PES technical activities. Dr. Chen took to the pencil to remind us of the central mission of the council in PES, along with some statistics that make us all proud of our achievements, in terms of reports and standards publications, that advance the science and technology in our field. Who remembers that PES is organized into 17 technical committees and four coordinating committees? Who knows the number of publications or the number of downloads from the PES resource center last year (Figure 2), broken down by technical committee? This month’s “Leader’s Corner” column [A9] by Dr. Chen provides some facts and insights about PES technical activities’ performance to satisfy the curiosity of the common IEEE members. Dr. Chen further reported on certain major initiatives currently under implementation, such as the creation of a new standing committee, the Localized Technical Activities Committee, under the vice president of technical activities. Working closely with local Chapters, its goal is to encourage more global participation by mitigating language and geographic barriers, which some PES members have faced when getting involved in formal technical committee activities.
We are currently completing the planning of the 2024–2025 calendar of special issues. Three special issues were approved at the spring editorial board meeting, which was held online on 23 March 2023. When the next year’s list is finalized, the calendar will be posted on the magazine website (IEEE Power & Energy Magazine; https://ieee-pes.org/). In case you are interested to know more about how this magazine is run, you are cordially invited as a guest at the next editorial board meeting to be held in Orlando, FL, USA, during the PES General Meeting scheduled for 16–20 July 2023 (https://pes-gm.org/).
In this issue’s “History” column [A10], we welcome back Joseph Cunningham as he shares with us the insight into a view of New York City at the early stages of commercialization of electric lighting and power systems in an article titled “City of innovation: NY City at the birth of electrical systems.” In this treatment, Cunningham covers technologies, installations, the business, and the people of New York City in these pioneering early days.
We are sad to report the passing of Dr. Merill Hyde, a past contributor to this magazine and a leader of our Power Industry Computer Applications Conference for many years. His obituary is included in this issue. At the request of many readers, we would like this column to continue, and therefore, we invite the submissions of obituaries through the assistant editor desk (sherryvhensley@gmail.com). We suggest that authors of such an obituary must consider only widely known people in our community for their technical or leadership achievements or who were benefactors of PES.
I want to thank the editors and this team of authors for their tireless work in making this issue happen. Dr. Luis Barroso deserves a special mention because of his overnight responsiveness during the critical and often stressful stages of the review cycle, which we started in early December 2022. The magazine often focuses on the engineering aspects of our discipline. It is thus more than good news to see this issue shedding more lights on “citizens’” interactions with the grid through market mechanisms mediation. My only regret is that energy poverty and justice, which are highly correlated with market mechanisms and the regulatory environment, were not addressed. The viewpoints of underdeveloped countries and indigenous populations who are often located in off-grid zones were not discussed. We had a special issue last year (2022 September/October) on smart villages, which is worth rereading in this respect. However, our future goal is to put out a dedicated issue on energy poverty and energy equity, which fits nicely with the last of the four Ds, i.e., a more democratized and inclusive access to electricity, not only by empowering the rich consumer but also by providing energy access and energy security to the underprivileged.
In addition to energy poverty, I am always looking for new topics for special issues that can be timely and of interest to a broad audience, including policymakers. I also welcome new ideas for spontaneous articles, which have nothing to do with any special issue, to give anyone who is interested in this magazine an equal opportunity to have his/her views published. Feel free please to forward any concerns or questions to me: innocent.kamwa@gel.ulaval.ca.
“Bright ideas 2022: The future of Canada’s power and utilities sector.” Deloitte. Accessed: Apr. 29, 2023. [Online] . Available: https://www2.deloitte.com/ca/en/pages/energy-and-resources/articles/the-future-of-canadas-power-and-utilities-sector.html
“Plan de développement de reseau.” Enedis. Accessed: Apr. 29, 2023. [Online] . Available: https://www.enedis.fr/sites/default/files/documents/pdf/plan-de-developpement-de-reseau-document-preliminaire-2023.pdf
Digital Object Identifier 10.1109/MPE.2023.3269542
Date of current version: 21 June 2023
1540-7977/23©2023IEEE