Small scale embedded generation (SSEG) grid connection – Eskom (SSEG) grid connection – Eskom

Experience and input

Shirley Salvoldi, Mobolaji Bello & Danie Pienaar

Eskom Holdings Limited16th March, 2012

Scope

• Why must we do this i.e. SSEG connection to LV network?

• Current reality:

• Technical

• Pricing

• Integrated Demand Management (IDM)

• Summary of issues to be resolved

• What needs to be in placed…..

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Why must we do this?

Increasing pressure from customers (being green, increasing electricity tariffs, competitive PV costs) There are perceived

and real barriers with regard access to the grid, wheeling of energy and licensing that needs to be addressed.

Is already included in the integrated resource plan (IRP)

It’s the right

thing to do! addressed.

If we don’t put mechanism in place to enable this, we may be forced to do this somewhere down the line

If we don’t do this properly there will be an economic cost e.g. wasted infrastructure development

Safety issues

It supports energy efficiency and is a huge opportunity to have ordinary SA citizens come to the party and help solve the generation crisis

thing to do!

But…. there are

significant

challenges and

implications

Key issues facing Eskom

Current reality: Technical, Pricing and IDM

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Technical elements

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Summary of technical issues that SSEG can present

• Network safety

• Power quality issues

• Impact on load forecasting

• Grid stability

• Custodian of generator data as huge penetration might impact the over-all system in future

6

Work done till date – NRS 097-2-series

• NRS 097-2-X work initiated due to increased number of residential PV connection requests (especially municipalities)

• Ensuring safe and adequate operation of the network

• Network safety

• Personnel safety

• Quality of supply

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• Quality of supply

• Working group: Eskom, Municipalities, Equipment manufacturers, Academic personnel

• NRS 097-2-1 published Dec 2010

• Standard Conditions for Small Scale (less than 100kW) Embedded Generation within Municipal Boundaries – NERSA approval on 22 Sep 2011

NRS 097-2- series

• Set of industry standards being developed that define the utility interface for the interconnection of small scale EG to a utility network

• The standards apply to EGs of nominal capacity of less than 100kW, connected to a low voltage (400/230V) utility network

• The standards cover:

- Utility interface requirements (NRS 097-2-1 – approved & published)- Utility interface requirements (NRS 097-2-1 – approved & published)

o Also approved by NERSA (22 September 2011)

- Equipment type testing (NRS 097-2-2 – draft circulated for comments)

- Utility Framework (NRS 097-2-3 – conceptual phase)

8

Utility interface requirements – NRS 097-2-1

� Focuses on the interface between the embedded generator and the utility.

� It was decided early on that the standard will be “device” independent.

� Mainly static inverters

� Makes provision for other generators, e.g. induction generators

� The specification is mainly applicable to grid connected systems interfaced � The specification is mainly applicable to grid connected systems interfaced through static power converter technology.

� Basic protection requirements

� Basic safety requirements (e.g. anti-islanding)

� Basic QOS emission limits

� Basic metering arrangements – tariff not considered

Can already see the need for revision2012/03/18 9

NRS 097 -2-X

• NRS 097-2-2: Type Testing

• Deals with product type approval, installation requirements and certificate of compliance on the EG customer’s side of the meter.

• Sent out to WG for comments

• NRS 097-2-3: Utility framework

• Deal specifically with the commonly designed unidirectional flow of energy in LV networks, with cumulative impacts of EGs, provide basic acceptance criteria based on network strength and EG size, with substation configuration and metering arrangements.

• Envision similar planning criteria to Herman-Beta method

• NRS 097-2-4: Procedures for implementation and application

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Current initiatives – (the approach)

• Use benchmark LV networks for different LSMs, where the benchmark networks will be selected via the working group members.

• Benchmark networks to model from MV terminals of MV/LV transformer to customer service connection.

• Create scenarios based on different LSMs focusing only on LV networks with PV technology only

• Develop models using different PV sizes based on estimated PV sizes from w/m2 topology

• Develop a spread sheet based on an agreed level of confidence based on all of the following parameters:

• Feeder voltage drop

• Reverse power flow

• Harmonics2012/03/18 11

Anticipated target goals from current initiatives

• Critical limits/ problems that will be experienced due to EG penetration

• Magnitude relative to the MV/LV transformer or the peak load of the network, or ADMD that will lead to these limits

• How will it influence utility connection process accordingly, including informing what data needs to be obtained and maintained?

• How it will influence installation certification and internal wiring stds, including what certification and testing is required to reduce the probability of problems?

• Recommendations on how standards and design approaches should be changed e.g. NRS 034. i.e. can we include the developed models in the standard Herman Beta spreadsheet etc.

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A new renewable generation code is being developed and it will address

the gap for units >100kW and < 1MW not presently covered by NRS097-2-x

Pricing implications of SSEG

Opportunities and challenges

Pricing implications for SSEG

• Once the connection to the grid is compliant with all the technical requirements, the customer may want to export onto the grid

• Once export is allowed, there would need to be some form of contract to set out the financial, legal and technical requirements for the connection

• Customer will either offset own-use (energy efficiency) with no export onto the grid or where the time of generation of energy is not the same as consumption and the grid is used as bank or storage mechanism.

• Eskom has a current policy for larger customers with own generation to • Eskom has a current policy for larger customers with own generation to allow offset of energy exported.

• It is allowed because these generators are identifiable, there are technical standards in place and the metering is capable.

• The policy provides that the account is offset for the energy exported

• This offset is done for energy costs only and at a rate that is closest to the the cost of energy i.e. the Megaflex energy rates, excluding losses and reliability services

• The offset is based on Eskom’s average costs and there is no premium given for this energy.

Net-metering?

• Net-metering is where the meter runs backwards at times when energy is exported onto the grid i.e. the energy used is reduced by the energy exported.

• Cheap solution to implement – in many cases would require only small changes to existing meters.

• Does not require separate measurement of imported and exported energy.

• This may not be suitable for a tariff that recover network and retail costs in energy rates (like a single energy rate or an inclining block rate) as the network revenue will be lost with no cost benefit to a distributor. network revenue will be lost with no cost benefit to a distributor.

• Net metering does not allow for the energy exported into the grid to be measured on a time-of-use basis.

• Potential for fraud and tampering

• Bi-directional metering that measures both the import and export of energy:

• Provides a more cost reflective solution as the energy exported is off-set against energy costs only and not all other costs, therefore protecting the distributor’s revenue against its own fixed network costs.

• If we go the smart meter route, this will allow for better grid integration but is expensive.

Pricing/revenue challenges

• Most of Eskom’s tariffs have network costs built into the energy rates i.e. they are not fully unbundled to reflect separate network charges

• In many cases network costs are recover through energy related charges

• In the case of IBT all charges are energy related

• If the meter is allowed to turn backwards (currently not an approved practice), this would mean credits will be given not only on energy related costs but also network related costs

• This is a revenue risk for any retail and network business, whose costs are fixed and not related to energy

• Would require network costs to be recovered though fixed monthly charges (not currently possible on prepayment systems or for IBT)

• Allowing a meter to run backwards increases risk of fraud and theft of electricity.

• For prepayment meters, if the meter is allowed to turn backward this means the customer is actually charged for the energy exported

• it is a deliberate design so that customers cannot tamper by reversing their power flow.

• Therefore how can prepayment customers be accommodated?

Pricing/revenue solutions

• Solutions could include:

• To be able to measure exported energy or to have remove non-energy related costs in the tariffs to be recovered through fixed charges

• This is possible to measure exported energy with (4-quadrant meters) programmable meters installed for the large power users, but not possible with current small power user meters

• This would require either installation of smart meters or other simpler meters that can measure non-TOU bi-directional flow

• This would require either installation of smart meters or other simpler meters that can measure non-TOU bi-directional flow

• Require work done on prepayment specs (this is currently being addressed)

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Allowing off-set for smaller customers

• There would potentially be costs associated with the connection and

installation of metering

• Would require the customer to be on a tariff that has fixed charges

• Need to ensure that fixed costs are covered

• Should a credit be provided on a TOU basis i.e. higher value in peak

times or on a fixed rate that ignores TOU

• If the credit should be TOU this will require smart meters.• If the credit should be TOU this will require smart meters.

• Is the credit given at a premium –or at the average energy cost?

• A premium could not be paid unless it was government policy and

approved by NERSA (a premium would impact the price of electricity)

• Would banking month to month be allowed?

• Need to have rules

• Rules need to ensure no arbitrage

Contractual and other

• Need to develop a simple connection agreement

• Need to identify what must go into this agreement

• Customer must understand their rights

• Will have to have the technical and pricing requirements sorted out?

• Does the business have the capability to cope with the additional service and administration resources that would be required?

Integrated Demand Management

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Eskom Generation

Status quo

Demand Side Management (Behind the electricity meter)

Supply Side (Generation Capacity)

“Sustainable Energy”(RE and EE the ‘two pillars’)

Renewable

energyEnergy Efficiency

Demand

Manage

ment‘‘‘‘Conventional’’’’ energy

Electricity portfolio

Suppliers

Municipal generation + IPPs

Consumers (R, I, C, Agr,

Municipal, Eskom internal,

etc)

Status Quo

Current

‘definition’

as applied

in SA

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REFIT (Renewable

Energy Feed-In

Tariff)

ESCO‘Standard’

electricity tariffs

PNCP (pilot

national

cogeneratio

n

programme

)

MTPPP (medium

term power

purchase

programme

)

Market/

financial offers

“Distributed Generation”

Standard

offer

Std. product

+ rebates

Performance

contracting

Mass rollout

DR / DMP

Renewable

energy

Energy

Efficiency‘‘‘‘Conventional’’’’ energy

Proposed ‘Adjustment’

Demand

Manage

ment

Electricity portfolio

Small scale and micro-

renewables