On the 11th of may, we brought together some of the brightest minds that are rethinking the future of energy. At this event, we hosted 6 roundtables where topic experts could meet and share their thoughts on a specific topic. One of these topics was Local Energy Systems.
The world is facing mounting pressure to accelerate decarbonization and mitigate the impacts of the energy crisis within households and businesses. Consequently, this pressure is being felt most by countries’ national grids, networks, and infrastructure as they are squeezed by the move to an electrified future. The electricity network in residential areas is already approaching maximum capacity, meaning that we must pursue alternative ways to reduce load and increase grid flexibility as much as possible.
As a result, community-based initiatives are gaining increasing attention as an effective vehicle for more people-centered, equitable, flexible, and resilient energy systems.
We call for a national agenda to help define a number of integrated energy community solutions that can service the most common situations. Additionally, providing subsidies for the adoption of appropriate solutions that effectively address grid congestion challenges can further incentivize implementation.
During this roundtable discussion, industry leaders and innovators discussed the key challenges when trying to stimulate and facilitate local energy communities. Below you’ll find the key takeaways:
1. Incentivization
Consumers and organizations should be encouraged to free up their underutilized grid capacity to address grid capacity issues. Dynamic pricing plays a crucial role in incentivizing smart energy usage, as demonstrated by Austria’s successful implementation of dynamic pricing incentives.
2. Uniform design for implementation
Stakeholders need clarity on integrated commodities and reusable infrastructure. Interfaces and integration between assets and services pose a significant challenge. Interoperability between manufacturers and service providers is essential for universal access to individual assets, requiring improved standardization and regulatory changes.
3. Building community and trust
Educating and incentivizing communities about the impact of their energy activities is crucial to activate participation. Community marketplaces for flexibility trading are important for local energy communities to thrive, with a focus on authenticating different players. Blockchain technology can help overcome trust issues in community-based marketplaces.
4. Regulation
Current regulations often prohibit energy sharing between peers (P2P). Introducing legislation that allows for P2P energy sharing is a key regulatory step required.
Local Energy Systems, specifically Energy communities, can play a crucial role in creating a future-proof energy grid. We are witnessing the emergence of numerous communities throughout the Netherlands and across Europe. However, most energy communities are independently developing solutions and services, which leads to several drawbacks:
- Inefficiency in selecting and implementing various solutions.
- Distribution System Operators (DSOs) have to manage multiple solutions without cross-community optimization.
- Maintenance and support become fragmented and scattered.
- Perhaps most importantly, communities rely on their own knowledge to implement solutions, which limits accessibility for communities with lower income and technical expertise.
Therefore, we advocate for a national agenda that defines a set of integrated energy community solutions to address common situations. Additionally, providing subsidies for the adoption of appropriate solutions that effectively address grid congestion challenges can further incentivize implementation.
