With countries stepping up their efforts to combat climate change, the need for an adaptable, greener, and more resilient energy supply has never been greater. In this episode of Climatic, Pradeep Perera from the Asian Development Bank and Anders Hove from the Oxford Institute of Energy Studies lay out the necessary conditions for a green and resilient grid.

Climatic is ADB Ventures’ series about the innovators decarbonizing Asia and the Pacific. It is produced by the Asian Development Bank and ADB Ventures with financial support from the Climate Investment Funds’ Clean Technology Fund program. The latest Climatic video series features interviews with innovators, investors, and infrastructure operators who are working to make electricity grids stronger, greener, and more resilient.

Transcript

Linh Thai  00:05

Welcome back to Climatic. In this episode, we'll be looking at how to build a green and resilient grid. Demand for electrical power is set to soar as countries continue the effort to decarbonize with cleaner, greener technologies, coupled with more extreme weather conditions, growing populations and market fluctuations, the need for an adaptable, more resilient energy supply has never been greater. But can these increased demands be met? Or will we all be left in the dark? With me now are Pradeep Perera from the Asian Development Bank and Anders Hove from the Oxford Institute of Energy Studies. Thank you for joining me today. Anders, I'll come to you first, our electrical grids are going through a fundamental change in the way they operate. One idea that's become very important is that of resilience. What does it mean for grid to be more resilient?

Anders Hove  00:55

I don't think that there would necessarily be one clear definition, and worldwide, that is actually a challenge is that, historically, the word reliability or having a reliable grid has had many different definitions and quantitative measurements. In general, the idea of resilience has grown, I think, over the last few decades, in tandem with the idea of sustainability that we need to be more resilient against a variety of physical and economic shocks, as well as having the flexibility to use different sources of energy, and to make sure that we have enough energy available to meet our demand.

Linh Thai  01:30

Pradeep, our grid system has been built over the last 100 years, and during that time, its design has remained largely unchanged. What issues are there with the way our grid is currently set up, and what solutions are there to overcome these flaws?

Pradeep Perera  01:43

When you have a top down power system, you have few power plants, which are connected to the high voltage transmission network, and then they basically the power flows from these power plants to the consumer. So if something breaks down in that system, at the high voltage system, the entire system fails. Now in a distributed system, this is unlikely to happen. Because you are not dependent on a single source, you are dependent on multiple sources. So even if one or two sources fails, it doesn't result in the entire system failure.

Linh Thai  02:13

It seems to me that the grid operators need to change the way they are structured. Who is leading this change? Is it the grid operators or the consumers? What do you think Anders?

Anders Hove  02:21

I would say that, in general, it has to be led by policymakers. All of the choices that have led to the energy system that we had today really did emerge from policy. I would say that the market was not the driving force that led necessarily to, let's say natural gas dominating the power system of the United States, doesn't mean the market doesn't play a role. Certainly, the high fossil fuel prices will probably lead to a clear incentive for many people to install distributed energy in the future. But that can only take place if policy supports, that and currently in many places, you see that policy is an obstacle to distributed energy.

Linh Thai  02:57

But this is not just a discussion about the best way to get power into our homes, is it Pradeep? We need to reimagine how the grid operates so that we're also able to further decarbonize.

Pradeep Perera  03:07

Yes, I think there's an urgent need to combat the climate change, and a lot of countries have made commitments to net zero by 2016, 2015, 2017. What is important is what we are going to do in the immediate timeframe that is the next 10 years. So during this timeframe, I think there's an urgent need to address the increase in greenhouse gas emissions in the power sector. For that painting, we have to increase the renewable energy penetration. In most of the countries, renewable energy contributes about 10 to 15% of the total generation, this need to be increased to around 25, 30%, within next 13 years. So now to achieve that, I think distributed generation plays an important role.

Linh Thai  03:51

Decentralization allows better integration of renewables into the grid. Anders, is there extra resilience gained from distributed generation inherently green?

Anders Hove  04:01

There's a statistic that among the largest utility companies in California, there are over 12 gigawatts of diesel generation in people's households or businesses. So that's about a fourth of the generation capacity of the state now. So the fact is that consumers are turning to their own solutions. And so it's up to the state governments, instead of rejecting the idea of having distributed generation, accepting that it's going to happen, because the grid needs to have that resilience, and it needs to have that backup generation. So how do we organize the incentives to make sure that those distributed generation and storage sources are as clean as possible? And that's just an example of California but that applies to anywhere in the world.

Linh Thai  04:44

Anders just mentioned how consumers are finding their own solutions, even without incentives to do so. Pradeep, what do you think will be the role of consumers in a newly decentralized grid?

Pradeep Perera  04:54

I think going forward, consumers can be what is called a prosumer. In addition to consuming, you can also produce and supply to the grid depending on the time of the day. For instance, if you have a solar roof system, you can supply power during the daytime, if you have an energy storage system or battery system at your home, you can store energy during the off-peak hours then you can supply during the peak hours. And also, consumer can actively participate with management services through demand response, where consumer can reduce his demand in response to certain signals, price signals, or some control signals issued from the management system in return for a certain fee.

Linh Thai  05:35

One final thought, Anders, will we ever get to the point where we don't really need grids? Could consumers become not just decentralized, but fully independent?

Anders Hove  05:44

In the future, in the sense of not needing a grid at all, or mostly generating our own power at home or in our offices, for example, that is not a realistic vision, but the idea that there would be more decentralized energy and that in general, energy would be generated closer to the actual end consumer, and that grids would be primarily used to balance this decentralized generation over a larger geographical area. That is challenging the business model and physical design of grids around the world.

Linh Thai  06:17

A fascinating discussion. Thank you both for joining me today. Decentralization could be the solution to both greater resilience and an overall greener power supply. But there are many barriers to overcome to make distributed generation a reality. Some of the biggest challenges are for the grid operators themselves. So next, we'll find out what solutions the grid operators want to help meet the changing needs of the market and expectations of policymakers and consumers. That's up next on Climatic.

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