New cables alone are not the solution

At an industrial estate in Alkmaar struggling with grid congestion, a technical wholesaler is reaping the benefits of its own ‘microgrid’, which enables smarter use of the available capacity. There is also a glimmer of hope for smaller businesses that are reaching the limits of their connection capacity.

On an industrial estate on the southern outskirts of Alkmaar stand two rows, each comprising four battery cabinets taller than a man. Next to them stands a small new building which, with its black wooden façade on one side and large glass panels on the other, would not look out of place in a bungalow park in the Veluwe. Inside, switchboards and other hardware fill an entire wall, with a huge screen full of graphs directly opposite. Thijs Wichers, business development manager at Schneider Electric, points to a small device that is barely noticeable amongst all the flashing electronics. ‘This here is the brain of the entire system,’ he says.

For a long time, we thought that grid congestion could only be solved by building more cables and more transformer stations. But we can also manage supply and demand more intelligently. That is exactly what Solar Nederland is doing here. The technical wholesaler for installers has teamed up with energy technology group Schneider Electric to build an energy system in which solar panels, batteries, heat pumps, charging points and building services are continuously coordinated. The system predicts when energy will be cheap, when the sun will shine and when the building will need a lot of electricity. The software then automatically determines when the batteries need to be charged or discharged.

The need was urgent. Solar wanted to expand its distribution centre, install more charging points and switch to heat pumps, but had reached the limits of its existing connection. ‘We have a contracted capacity of 500 kilowatts with the grid operator here,’ explains Martin Kiene, sustainability & strategy manager at Solar Nederland. ‘But due to the expansion of the premises and the sustainability measures, we actually needed much more capacity.’

At the same time, over 2,100 solar panels were installed on the roof of the new distribution centre. On sunny days, however, feeding electricity back into the grid proved virtually impossible. ‘We sometimes had to switch off the inverters,’ says Kiene. ‘That didn’t feel right. We were generating renewable energy, but often couldn’t make use of it.’

Smart system

The situation in Alkmaar is not unique. The electricity grid was originally designed for a limited number of large power stations supplying electricity to businesses and households. Nowadays, homes, businesses, wind farms and solar parks also generate electricity. ‘We’re suddenly using the same grid in two directions: to transport both the electricity we generate and the electricity we consume,’ says Wichers.

This is leading to increasingly frequent local bottlenecks. Grid operators are investing billions in expanding the electricity grid, but according to Wichers, part of the solution lies in making smarter use of existing capacity. A microgrid can help with this.

In Alkmaar, hundreds of sensors continuously measure how much electricity Solar’s enormous building consumes, how much solar energy is available and how much energy is stored in the batteries. This information is combined with weather forecasts and current electricity prices, whereupon the ‘brain’ of the grid – that inconspicuous little box amongst all the flashing hardware – decides on the smart course of action.

Shortly after it went live, Solar saw an example of this. ‘One night, the system suddenly started drawing large amounts of electricity from the grid,’ says Wichers. ‘It was due to get cold the next day and the software anticipated high demand from the heat pumps. At the same time, the system saw that electricity was cheap at night. So it decided to top up the batteries in advance.’

At first, this seemed strange to staff. Why buy electricity at a time when the building was using hardly any energy? The following day, it became clear why this was, in fact, a sensible move: the heat pumps ran largely on electricity stored earlier, and the peak load on the grid remained limited. ‘A battery is just one component of the microgrid,’ says Wichers. ‘The software continuously coordinates generation, storage and consumption.’

Payback period

The parties involved are enthusiastic about the results. At peak times, the Solar Nederland building consumes around nine hundred kilowatts, whilst the grid connection is officially rated at just five hundred kilowatts. The difference is supplied by the building’s own solar panels and batteries. ‘This meant we could expand without having to upgrade the connection,’ says Kiene. ‘And that’s incredibly valuable in an area with grid congestion.’

In total, Solar invested a substantial sum in the system – Kiene prefers not to disclose the exact figure in this article. This includes, amongst other things, the batteries, software, metering equipment, heat pumps and system integration. According to Kiene, the payback period is approximately six years. According to Schneider Electric, in the first quarter of this year, Solar needed to purchase 58 per cent less energy than in the same period a year earlier. This resulted in financial savings of around 68,000 euros and avoided emissions of approximately 85 tonnesof CO₂.

Remarkably, total electricity consumption actually rose. ‘We have largely switched to electric heat pumps,’ says Kiene. ‘Thanks to more efficient use of energy and carefully chosen purchasing times, total energy costs still fell.’

Energy management

For many SMEs, however, a microgrid of this scale remains out of reach, even though they face largely the same challenges. This prompted Koen Mulders to develop a simpler alternative. The former Philips engineer is co-founder and CEO of Currentt, a tech start-up based at Amsterdam Science Park that develops local energy management systems.

Whilst microgrids are particularly attractive for large buildings and distribution centres that can spread the investment over several years, Currentt focuses on SMEs, housing associations and households. ‘Many business owners only realise they have a problem when they actually come up against it,’ says Mulders. ‘They want to grow, install charging points, switch to electric company cars or fit a heat pump, and then discover that their connection is the limiting factor.’

According to him, the problem often lies not in a structural shortage of capacity, but in a lack of insight and smart management. ‘Most SMEs only use their connection to full capacity at a few specific times. The rest of the time, there is actually plenty of capacity available.’ He compares it to a motorway. Traffic jams occur during rush hour, but that doesn’t mean the road is congested all day long.

At the heart of Currentt’s solution is a device in the meter cupboard: the Navigator. It collects data from charging points, solar panels, batteries, heat pumps and other installations, and highlights when peaks occur.

‘Often, there are only a few moments each week – perhaps a quarter of an hour – that cause the problem,’ says Mulders. ‘If you can shift or smooth out those peaks, you suddenly create a lot of extra usable capacity within the same connection.’

This is achieved partly through insight and automatic control. Charging points can start charging later, heat pumps can temporarily reduce their output, and batteries can absorb peaks; the output from solar panels can be adjusted in real time to match current usage. ‘Decisions are made on the basis of parameters that you set yourself and, for example, on the basis of dynamic energy prices,’ emphasises Mulders. Sometimes this even involves adjustments down to the second.

Currentt is now scaling up its operations. For instance, discussions are underway with housing associations and construction firms to convince them of the benefits of this solution. It helps that, at the start of the summer, Mulders received an award from State Secretary Jo-Annes de Bat of Climate and Green Growth at the national Net Congestion SME Innovation Competition.

Cloud or local

Although the scale differs, both systems illustrate the same trend. On sunny afternoons, there are peaks in feed-in, whilst in the evening demand actually rises sharply. It is therefore becoming increasingly important to balance supply, demand and storage. ‘It’s less and less about copper power cables, and more and more about software,’ says Wichers.

There are now also significant technical differences between the two systems. Schneider Electric processes energy data in a cloud environment where consumption, weather forecasts and market prices are combined, although the grid can also operate with a local system without all that extra data and those algorithms. Currentt, on the other hand, processes all data locally in the meter cupboard. According to Mulders, this offers advantages: it is much faster, it is more reliable (as it works even without a connection) and, from a cyber security perspective, it is much safer. ‘If you run energy management entirely via the cloud, everything has to go out first and then back into the building again. We wanted to avoid that.’

Energy hubs

At the Alkmaar business park, plans are being considered for an energy hub where businesses can exchange energy locally. Solar’s microgrid, the solar panels at the nearby AFAS Stadium and the waste-to-energy plant just round the corner could all play a part in this. The potential is huge, but development is progressing slowly. For businesses currently facing grid congestion, energy management systems often offer a quicker solution. Grid operators, too, are increasingly focusing on flexibility as a complement to grid expansion. After all, not every extra kilowatt immediately requires new infrastructure.

This is also changing the work of engineers. Whereas calculations used to focus mainly on transformers, cables and switchgear, software, algorithms and data processing are now at least as important.

In Alkmaar, the system now runs on a cloud platform that continuously monitors the building’s energy consumption. ‘It’s a self-learning system,’ says Wichers. ‘The longer it runs, the better it understands how a building behaves.’

This also brings new challenges. In the first few weeks after commissioning, the system sometimes really had to ‘learn’ to make the right choices, or problems arose following software updates. ‘That’s when you suddenly realise just how dependent the energy system has become on IT,’ says Kiene.

Cybersecurity is playing an increasingly important role in this regard. ‘We’ve built in multiple layers of security,’ says Wichers. ‘From encrypted communication to compliance with the new European Cybersecurity Act, the reliability and security of our customers’ data are our top priorities.’

Although the system has only been operational for a few months, Solar is already considering further expansion. There is space on the site for a wind turbine, whilst increasing the battery capacity is also being investigated. ‘Ultimately, we want to be able to operate as autonomously as possible,’ says Kiene.