With the ending of the Low Carbon Networks Fund and the maturity of many of the projects it financed, now is a good time to assess whether they worked as intended. By Lois Vallely.

Ofgem’s Low Carbon Networks Fund (LCNF) came to an end in March this year and was replaced by the Network Innovation Competition  and the Network Innovation Allowance as part of the new RIIO-ED1 regulatory regime. Many of the projects funded by the LCNF are now reaching completion, with UK Power Networks recently announcing that it had delivered both Low Carbon London and Flexible Plug and Play on time and significantly under budget.

The regulator introduced the LCNF in 2010 as part of the five-year price settlement agreed that year, allowing up to £500 million to support projects sponsored by the electricity distribution network operators to try out new technology, and operating and commercial arrangements, with the aim of providing security of supply at value for money as the UK moves to a low-carbon economy.

But have they been successful? And how will the results be used? Here, Utility Week takes a closer look at some of the LCNF-funded projects undertaken by the DNOs.

UK Power Networks: Low Carbon London

Project length: four years

Status: complete

Estimated cost: £28 million

Funding from LCNF: £21.7 million

Actual cost: £14.9 million

UK Power Networks (UKPN) embarked on the Low Carbon London project to plan for future energy demand and look at how to accommodate technologies, such as smart meters, electric vehicles and decentralised generation, which would be deployed to help London meet its carbon reduction target of 60 per cent by 2025.

The project trialled smart grid technologies and new commercial arrangements, both with business and domestic customers. It also looked at ways of accommodating the anticipated growth in decentralised generation, as well as managing higher demand for electricity created by the switch to electric cars and heat pumps.

Low Carbon London will be used to provide information for urban DNOs to better enable the uptake of home and workplace electric vehicle charging, support the increase in combined heat and power plants in urban areas, and facilitate home electric heating and micro-generation uptake.

The project also demonstrated that improvements can be made by supporting these changes in a smart or optimised way, as opposed to building new network infrastructure.

Head of future networks Martin Wilcox says: “There are clear reasons why we did this trial, which is about supporting the country as we try to reduce carbon emissions. We were trying to find out how flexible people could be in the way they use electricity to see if this can make better use of intermittent renewable energy and reduce short peaks on the electricity network, keeping down the costs of delivering electricity for consumers.”

Scottish Power Energy Networks: Flexible Networks

Project length: three years

Status: due for completion this month

Estimated cost: £6.4 million

Funding from LCNF: £3.6 million

The aim of Scottish Power Energy Networks’ (SPEN’s) Flexible Networks project is to provide a 20 per cent increase in network capacity through innovative measures, enabling more customers to make the transition to low-carbon generation and demand-response technologies.

Future networks lead engineer Kevin Smith says: “The essence of the project is looking at trying different things on the network – we call them interventions – which are different from business-as-usual solutions, for when there is increased load or increased demand for generation.

“The normal solution would be to reinforce the network with new cables, lines, substations and transformers. We were asking, what else could we do differently?”

SPEN looked at four techniques that could circumvent the need for network reinforcement:

• flexible network control – 9 per cent of peak load can be redistributed on the network at appropriate times;

• dynamic rating – a possible 7 per cent increase in capacity;

• voltage optimisation – a 2 per cent reduction in demand by reducing voltage where appropriate;

• energy efficiency – a 2 per cent reduction by reducing overall demand.

The objective is to demonstrate how these techniques can release capacity on the high-voltage network, allowing greater take-up of low-carbon technologies without the need for traditional network reinforcement. The project also hopes to encourage specific industrial and commercial customers to improve the energy efficiency of their buildings so as to reduce their demand for electricity.

The specific issues facing SPEN are mirrored across the UK electricity distribution network, and this project will be able to provide generic solutions and recommendations to other DNOs to address these.

Northern Powergrid: Customer-Led Network Revolution

Project length: four years

Status: complete

Estimated cost: £54 million

Funding from LCNF: £27 million

The Customer-Led Network Revolution (CLNR) project, led by Northern Powergrid, explored smart alternatives to reinforcing the network, as well as helping the DNO gain an understanding of how to deliver maximum network capacity at the least cost to customers.

The government’s plans to reduce carbon emissions by 80 per cent by 2050 will mean a widespread customer uptake of new sources of low-carbon generation and technologies, such as electric vehicles and heat pumps.

Head of regulation and strategy Jim Cardwell says: “Government policy is leading to consumers doing things differently. They are using new electricity loads and moving them across from other energy sources, so we must recognise that demand on local power grids may double by 2050. We must also recognise that all the solar PV coming on to the system is changing the way the network is having to operate. It’s less about the traditional network-to-customer flow-down through the system and more about supplying neighbours, and what that means in terms of how we can work our system in the future.

“So how can we enable customer changes being driven by government policy, and how can we do it at least cost while protecting service standards?”

CLNR found that most domestic customers are inherently flexible and contribute less to network peak demand than was previously assumed. The company also concluded that industrial and commercial demand-side response is a “viable and reliable option” to address network constraints, both in terms of customer co-operation and post-fault response. However, good engagement by the industry will be critical in finding suitable demand-side response provision in the right geographic locations, because there are presently few customers willing or able to provide this service.

Northern Powergrid has been sharing the findings from the project throughout. Now new tools, policy and technical recommendations, lessons learned reports, and guidelines for equipment and training will be shared with other DNOs.

Electricity North West: Capacity to Customers

Project length: two years

Status: complete

Estimated cost: £10 million

Funding from LCNF: £10 million

Electricity North West (ENW) started the Capacity to Customers project to trial smart grid technologies that would allow more power to be delivered to customers using existing assets rather than requiring additional investment to expand the network.

Over the next 25 years, the population of the North West is expected to grow by 10 per cent. Along with shifting to a low-carbon electricity system, this will provide a challenge for ENW in terms of ensuring there is enough capacity on the network to meet increasingly fluctuating demand.

The electricity network is designed to allow a DNO to re-route power around network faults, meaning that most of the time only half of its total capacity is used, with half reserved for emergency use. During the Capacity to Customers project, ENW discovered that, by reconfiguring the network, it could release the extra emergency capacity at other times.

Head of engineering Steve Cox says: “The concept of the project was: can we use the inherent capacity, which is not normally used, to feed the additional power consumption by customers and, thereby, not have to make the network bigger?

“The tricky bit was, if we do have a fault on the network, then we need to use that reserve capacity to supply customers. So if we add additional demand, how can we manage that demand?”

The project demonstrated that the technique is technically and commercially possible, as well as acceptable to a wide cross-section of the industrial and commercial customer base.

The learning from the project will now benefit the other DNOs, with ENW having carried out an extensive dissemination exercise to brief them on the findings. Cox says: “We’ve shared the contracts with them, we’ve shared the marketing materials, we’ve shared how to communicate with customers and we’ve shared the technology to make it all work.”

Scottish and South Energy Power Distribution: My Electric Avenue

Project length: 18 months

Status: analysis stage; due for completion December 2015

Estimated cost: £9 million

Funding from LCNF: £9 million

SSE Power Distribution (SSEPD) began the My Electric Avenue project, led by EA Technology, with the aim of providing a solution to the potential impact that the recharging of an increasing number of electric vehicles (EVs) may have on the local electricity network.

As the number of EVs grows, a point will be reached when the network starts to experience problems. The traditional approach to dealing with that would be to react after the problem had arisen, and that reaction would be effectively to overlay the cable networks, putting in new transformers, which is costly and causes disruption to customers.

SSEPD is using clusters of at least ten neighbours, each of whom is driving an EV for 18 months, to simulate the patterns of EV charging expected by 2030. The results will allow energy companies to plan for such future scenarios, both in the UK and internationally.

The company’s head of future networks, Stewart Reid, says: “One of the starting points for using a project like this is anticipating when you’re going to need it. There’s no point in waiting until a fuse blows to say ‘we’ve got a problem here’.

“One of the beauties of this solution is that it gives you that flexibility so that if the EV problem is only short term, you put in a low cost opex-based solution instead of a long-term capital-based solution.

“What we’re doing is effectively putting systems in place that allow us to get visibility of our systems so we can anticipate where the problems are.”

The project is now at the stage of analysing the data gathered about people’s charging habits and the impact on the local electricity networks. The knowledge gained is being shared with DNOs, all other stakeholders, and the public.

Western Power Distribution: Low Carbon Hub

Project length: four years

Status: complete

Estimated cost: £3 million

Funding from LCNF: £3 million

Through the Lincolnshire Low Carbon Hub project, Western Power Distribution (WPD) sought to explore how the existing electricity network could be developed to deliver low-carbon electricity to customers without the need for network reinforcement.

Innovation and low-carbon networks engineer Philip Bale says: “The main aspect of the Low Carbon Hub was trying to unlock capacity for new distributed generation connections. We have traditional methods that we can use to reinforce the network, but they were proving to be prohibitively high cost for those connections, with very few of them coming through to fruition.”

As part of the project, WPD developed six complementary project techniques to allow more generation to connect to the electricity network. These are:

• network enhancements, building additional functionality into the network;

• commercial agreements, developing new commercial arrangements (alternative connections agreements) between DNOs and generation developers;

• dynamic voltage control, measuring network voltage to balance demand and generation;

• 33kV active network ring, improving visibility of power flows and voltage profiles to give the DNO greater control;

• flexible AC transmission system device, improving control over network voltage and reducing network losses by balancing circuit-reactive power flows;

• dynamic systems ratings, using code to calculate maximum operating limits of windfarms.

WPD has already shared the knowledge gleaned from each of the methods developed in Low Carbon Hub with other DNOs and wider stakeholders throughout the project. The company says much of the research will be used to help inform future innovation projects.

Commercial arrangements were a particularly popular aspect of the research. WPD says it has committed to implement alternative connections across all four of its licence areas, with 11 new zones using alternative connections agreements due to be up and running by 2023.