Renewable Energy and Fossil Fuels in 2020 and Beyond? The view of Enel Distribuzione

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1 Renewable Energy and Fossil Fuels in 2020 and Beyond? The view of Enel Distribuzione Milan, January 21, 2014 Francesco Amadei Head of Engineering and Standardisation Infrastructure and Networks Division

2 Distribution Business is at a Crossroad because of emerging technological and market trends Examples for Italy EU green guidelines and directives 2020 Energy efficiency targets (MTEP) -20% -5% Tightening energy efficiency targets BAU EU SEN Growing distributed generation Increased complexity in grid management and obligation of ensuring the security of supply New trends fostering the electricity vector, convergence of infrastructures (e.g. optical fiber, multiservice metering) and new services for energy retailers and customers Distributed Generation (GW) Prosumers (k#) Electric Vehicles (k#) Bidirectional communication with customers Possible long-term penetration of electric vehicle and distributed storage 2

3 The massive growth of DG from RES in Italy A changing environment with new challenges The ambitious national support schemes for Low-carbon generation has led to a significant market penetration of distributed generation (DG) from renewable energy sources Non-RES Hydro Bio&Waste Solar 25,5 2,2 1,0 2,4 16,1 DG Connection to the Enel s Network HV: AT: 5,1 GW MV: MT: 15,1 GW LV: BT: 5,3 5,3 GW GW 25,6 25,5 23,8 19,1 27,1 28,5 29,8 31 Wind 3,8 2,4 3,1 4,7 6,4 9,1 Connection as of January 2014 (GW) The increased share of RES connected urgently requires the evolution of the distribution network management 3

4 Smart Grids Broadband Communication Smart Metering Electricity Gas Heat Electro-mobility Vehicle-to-Grid Fast-Charge Load Shaping Distributed Storage Secondary Substations as Data Hub Sensor Networks Big Data Urban, Environmental and Energy Data Active Demand Market Services Smart-Info Energy-Box Load Balancing Renewables Integration Dispatching Network Automation Forecast Storage Distribution System Operator as enabling factor 4 4

5 Energy investments by 2020 Generation Transmission Distribution 500 B RES : 350B 200 B Electricity: 130B Gas: 70 B 400 B 400 B needed to replace and modernize the Distribution Networks in Europe up to 2020 Source: EC communication on Energy Infrastructure priorities for 2020 and beyond, Nov 2011 based on PRIMES calculations

6 EU Multiannual Financial Framework Heading 3-7 Security, Global Europe, Administration and Compensations 153 B Heading 1a Competitiveness for Growth and Jobs 142 B It includes Horizon 2020 (80B ) bridge the gap between research and the market (5B on energy topics) Connecting Europe Facility (33B )* supporting the development of trans-european networks in the field of energy, telecommunications and transport (6 B on energy infrastructures) Heading 2 Sustainable Growth: Natural Resources B Heading 1b Cohesion Policy Economic, social and territorial cohesion 367 B It includes Regional Convergence 185 B Corresponds to less developed regions, whose GDP is less than 75 % of the EU average. Funding is made available through the European Regional Development Fund and the European Social Fund Smart Inclusive Growth Source: EC Commission website, EC Infoday 2013 *Total Connecting Europe Facility budget is 33 B due to 11B for Transportation allocated in Cohesion Policy 6

7 Enel leadership in Grid Innovation Smart Metering Network Automation and Integration of RES Demand Side Management Electro-mobility Smart Cities Investments exceeding 2,5 B Enel Distribuzione Performance Opex ( /Customer) 2001 (128 min; 80 /Customer) (41 min; 52 /Cust) Italian Tariff evolution Average cost (c /kwh) 18,93 12,08 Distribution 3,32-32% 2, Quality of Service SAIDI (minutes per year) Continuous Improvement 7

8 Low Voltage Line Bi-directional Data Flow Smart Metering The Italian experience Back Office GSM/GPRS Concentrator Telegestore Project ( ) Number of Meters installed 30.9 M units Cumulated CAPEX 2,100 M PLC Key figures Y2013 Customers Monthly Based Readings Switchings 31.7M 420M 3.8M 8

9 Integration of Renewables Italy (GW from HV network) Puglia (GW from HV network) h0.00 h12.00 h24.00 h0.00 h12.00 h24.00 Reverse power-flow Dispatching (% of AT/MT section with with reverse power flowing more than 5% of the year) +157% 18% Renewable Integration TSO-DSO Interaction 7% Forecast Storage Italy: 540,000 Distributed Generators for 25.5 GW 9 9

10 Demand Side Management Member States shall [ ] provide incentives for grid operators to make available system services to network users permitting them to implement energy efficiency improvement measures in the context of the continuing deployment of smart grids. Energy Efficiency Directive, 2012/27/EU Smart Info Technological solutions to the customer in order to: 500,000 Prosumers Enhance customer awareness on the energy use Enable in-home energy management Assure real time information on energy consumptions Enable an Active role in the Energy Market Enable a bidirectional communication with the network operator OBSERVE CHECK EXAMINE ANALYSE Energy efficiency solutions also for SMEs Innovative solutions for more efficient electricity energy uses 10

11 Electro-mobility Our Vision A charging infrastructure managed by the DSO guarantees: 1. Monitoring of the charging loads. 2. Controlling of the recharge, accounting for network s real-time capability. 3. The option to opt for a kwh-based invoice system, optionally involving real-time pricing. Smart grid integration of the charging systems will enable: 1. Flexibility of the charging according to energy availability (distributed generation). 2. Storage of possible energy overproduction. 3. Voltage control assuring the quality of service. Solutions based on smart-metering experience Ready for integration into Smart Grids scenarios 11

12 Electro-mobility Enel Projects in Italy Enel-RER Agreement e mobility Italy Rome, Milan, Pisa Firs Pilot Project in Italy Recharging infrastructure testing, EV rental, Enel Drive energy contract Bologna, Reggio Emilia, Rimini, Piacenza, Ferrara, Ravenna, Forlì, Cesena Interoperability with Hera Rome Roma Capitale-Enel-Acea Agreement Smart Cities Interoperability with Acea Bari, Genova Electric Mobility for Smart Cities European Project Electric Car Rental Enel - Poste Italiane Pisa (pilot) Zero emission mail delivery 2,000 Charging Infrastructures in Europe Rome, Milan Electric last mile project Manifesto for Electric and Sustainable Mobility Perugia 12

13 Smart Cities Fondazione Torino Smart City Expo 2015 Comune di Genova Comune di Pisa Comune di Bologna San Patrignano L Aquila Smart City Associazione Bari Smart City Comune di Cosenza 13

14 Enel s smart grid experience A complete set of Smart Grids projects already launched in Italy Included in PCI list - Call expected in 2014 ELECTRIC MOBILITY Agreement with ENI Agreement with RER Agreement with ACEA Poste Italiane National Mobility Plan GreenMe Duration: Budget: 230 Mln Funding: CEF Duration : Budget : 54M, Demo4 8,2M Funding: FP7 Duration: Funding: Proposal under evaluation PUGLIA ACTIVE NETWORK Duration: Budget: 170 Mln Funding: NER300 Duration : Budget : 42 M Funding : FP7 Duration: Budget : 24 M Funding: MIUR Duration : Budget : 16,1 M Funding : FP7 PROGETTO CARPINONE Duration: Budget : 10 M Funding: +2% WACC (AEEG) Duration : Budget : 4,2 M Funding : FP7 Duration: Funding : EC Budget : 7.9M PIANO OPERATIVO INTERREGIONALE Duration : Budget : 123 M Enhancing MV networks to host RES; 77 M Intelligent MV networks Funding : Structural Funds 14

15 Main reasons to support Smart Grids development Achievement of European Goals Higher Quality and more Added Value Green Jobs Improvement in quality life Potential growth for the whole Europe 15