In 2021 and 2022 extraordinarily high prices have been observed in electricity markets across Europe. The main reason behind the high electricity prices is the high price of natural gas, which is used to generate electricity. Natural gas-fired power plants are often needed to satisfy the demand for electricity when the demand is at its highest or when the volumes of electricity generated from other technologies such as nuclear, hydro, or variable renewable energy sources do not suffice to cover demand. Hence, natural gas is often said to be the price-setting technology in the European electricity system. Demand for natural gas and electricity increased as economies opened up after the pandemic lockdowns but also due to the 2022 high summer temperatures and the resulting increased cooling demand in parts of Europe. At the same time electricity generation from certain technologies, e.g., nuclear, has been below historical levels due to technical and weather-dependent circumstances. The Russian invasion of Ukraine added a supply shock that further exacerbated the constraints and pushed prices up.

All actors are needed in the transition of the energy system, not least the end-users, also referred to as the customers. This group may for example provide their demand-side flexibility. However, the incentives today can be seen as being too weak and the barriers to participate with flexibility too high.

A survey has been conducted that aims at laying the basis for a common understanding of international market designs and different flexibility services that are currently in use. To capture the whole picture, the topic of market design was split into three subtopics, covering general market design, flexibility market design, and flexibility services for system operators. Each of these topics is made accessible by several questions that have been answered by the respective countries, enabling the Working Group to understand presently used market designs and flexibility services. We find that the design of electricity markets differs significantly between European and non-European countries, thus presenting a wide range of challenges to the countries in question. Consequently, there are no general-purpose solutions for the successful implementation of flexibility markets related to operational planning. However, several common issues were identified and will be investigated in the further course of the work of Working Group 9 through stakeholder interviews from participating countries.

Within the ever-changing modern power system, power flows are increasingly transitioning towards becoming controllable and bi-directional. The modern power systems are faced with increased challenges pertaining to the integration of new technologies and devices. On the one hand, the need to integrate highly volatile and decentralised renewable energy sources (such as photovoltaic and wind), while on the other hand, power systems are seeing an increase in loads and capacity due to electrification of the transport, storage and heating/cooling sector (e.g., electric vehicles and heat pumps). Additionally, a change in consumer behaviour and evolving markets are also influencing this transition Such activities create increasing complexities and challenges due to the unpredictability in power flows within the power system. In order to overcome these challenges, system operators are relying on the use of flexibility which offer a wide range of opportunities and sought-after solution by providing a wide range of important services, which can enable system operators in operating their networks in a more efficient and cost-effective manner. However, utilisation of these resources to their full potential requires increased coordination between all relevant stakeholders in the power system. This increased interaction will not only allow for system operators to support each other in the optimal use of their respective grids, but also ensure that operating strategies in one network do not have any negative impact on the other. Furthermore, increased interactions with large and small system end users will allow for increased participation and therefore increased opportunities available from flexible resources.

The following video presents the concepts related to the electricity transition and the challenges faced by system operators when integrating flexibility into their networks. Furthermore, through the implementations of coordination schemes, systems operators can work together in order to ensure the safe, secure and reliable electric systems of the future.

This document highlights the key messages for all relavent stakeholders in the power system on the topic of flexibility harvesting.

This casebook reflects one way that ISGAN gather experts and stakeholders globally to
increase the awareness of a microgrid technology in the field of smart grid. In this stage, the
casebook features five (5) cases conducted from four (4) different countries including Austria,
Canada, Germany and Korea, primarily from a business model and economics standpoint.

For more detailed infoirmation, please download the full report attached.

Disclaimer

This report was prepared by the Secretariat of the International Smart Grid Action Network (ISGAN). ISGAN is organized as the Implementing Agreement for a Co-operative Programme on Smart Grids and operates under the framework of Technology Collaboration Programmes created by the International Energy Agency (IEA). The views and opinions expressed herein do not necessarily state or reflect those of any of ISGAN’s participants, any of their sponsoring governments or organizations, the IEA Secretariat, or any of its member countries. No warranty is ex-pressed or implied, no legal liability or responsibility assumed for the accuracy, completeness, or usefulness of any information, and no representation made that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring.

As zero operational-cost variable Renewable Energy Sources are foreseen to dominate the future energy mix, the abundance of green electricity will allow the replacement of fossil fuels in sectors such as heating, cooling, industrial processes, and transport. The intermittency of such energy resources implies significant systemic requirements for flexible solutions; thus, developments of the energy sector in general, and the power system in particular, instigate significant innovation activities in the fields of power system flexibility. Concurrently, complexities and interdependencies of system components and multitude of actors increase the risks of service failures and the complexity of production and grid planning, raising the demand for stronger and more agile resilience means and countermeasures. In this white paper we discuss the item “How can flexibility support resilience?”, considering the increased societal needs of a secure electricity supply. A report summarising experiences from large number of initiatives in a collaborative effort between of ISGAN WG 6 and ETIP SNET WG1.

Overview

This paper draws on the work carried out in the UK by the Energy Data Taskforce and how its recommendations pertain to and align with flexibility service provisions and market developments in the UK. Insights from relevant energy
stakeholders (networks, industry/innovation and academia) have also been incorporated.

Overview

There are many developments around flexibility within the energy system, particularly around electricity network reinforcement avoidance and trading platforms. However, there are also significant gaps in this area that could hinder the participation of innovators in the flexibility markets and, at the same time, limit the procurement process for network companies. This insight paper attempts to capture the views and insights from experts within the UK and draw out the key takeaways.

To adapt to the various changes, the interaction between stakeholders within the electricity supply chain is becoming increasingly more important. These interactions, despite their various challenges, provide many opportunities for increased efficiency of the operation and planning of modern networks in the future. To utilize flexibility to its full potential, coordination between various stakeholders within the energy supply chain is required. The increased need for stakeholder interaction relies on the advanced collaboration between respective parties which needs to be facilitated through technology advancements, data exchange mechanisms, regulatory considerations, and economic analysis.

To evaluate the perspectives on the flexibility and stakeholder interaction, a survey was launched, and its findings are presented in this report. The results of this survey provide an overview of flexibility and stakeholder interaction based on the various perceptions from a wide range of respondents from different geographic locations and sectors. The survey highlights the current status of the related topics and allows for the opportunity to identify concepts, such as challenges and opportunities, which require increased attention by all stakeholders in modern power systems of the future. This work provides a foundation for future work which will be conducted in the next phase within Working Group 6 and Working Group 9.

Summary

Many developments are taking place around flexibility within energy system(s), particularly around electricity network reinforcement avoidance and trading platforms. However, the scoping study hypothesis was that there are also significant gaps in research. As such, the study conducted a literature review to confirm areas that are being considered and concurrently surveyed ISGAN member countries to gather additional thoughts and concerns.

Conclusions were that there are areas that still need to be addressed, namely:

1. Integration of trading with dispatch
2. Understanding of multiple actors’, requirements (including where those requirements are conflicting) for flexibility and the commercial implications
3. A need to identify the characteristics that different flexibility options provides and how to access them
4. Interoperable markets to support the development and usage of flexible products and services at scale
5. Consumer focused flexibility
6. Avoiding stability/security of supply issues through loss of diversity

This report summarises the findings of the literature study and the survey, and explains the thought leadership, to date, in the areas described as gaps above.

Overview

The first factsheet presents some insights into metering as an enabler for consumer-focused flexibility, and gives a brief overview of the two generations of smart meter roll-outs in Sweden, as well as the national regulation of minimum functional requirements for electricity meters.

In spring 2021, the Swedish Energy Markets Inspectorate submitted a report to the Government with recommendations on how to facilitate the concept of independent aggregators in Swedish legislation. The second factsheet aims to summarise the main analysis and recommendations of the report.

The third factsheet presents some insights into price signals and consumer flexibility, and gives a brief overview of the characteristics of dynamic electricity pricing, as well as some food for thought going forward.

Building on the first initiative on Experimental Sandboxes (2019), ISGAN has organized a follow-up project (2021) with a series of interactive knowledge transfer workshops and accompanying activities on maximizing policy-learning from Regulatory Experimenting programs or initiatives.

Three international workshops and several interlinked workshops at the national level have focused on questions regarding relevant actors, the orchestration of actors, the role of transformation strategies, effective policy learning processes, and legal prerequisites for Regulatory Experimenting. During the course of the project, it became clear that a broader view on experimenting helps to position national initiatives without losing focus on how to maximize learning from these. Therefore, the concept of Regulatory Experimenting was adopted, which contains a wide range of tools for supporting innovation.

The casebook provides some of the best practices of regulatory sandbox program and smart grid projects under that framework from 10 countries as well as four key policy messages that were formulated by the ISGAN Sandbox KTP Project Team and the transdisciplinary group of participants in the workshops, with the intention to bring it to the attention of the Clean Energy Ministerial. Four policy messages were successfully presented to a variety of stakeholders in the power sector around the world at the twelfth Clean Energy Ministerial (CEM12).

Recently, the energy market is going through drastic changes with the launch of a new climate regime and the advent of the Fourth Industrial Revolution era. Amid these changes, many countries worldwide are strategically pushing for digital transformation to address various issues arising from the pursuit of energy conversion policies. As defined by the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety of Germany (BMU), energy transition refers to the shift to a sustainable economy through renewable energy, energy efficiency, and sustainable development, and its ultimate goal is replacing coal or other nonrenewable energy sources entirely with renewable ones.

Thus, energy transition is the shifting of centralized nuclear and fossil-based energy systems into decentralized renewable energy-based systems. However, the critical issue behind it is to expand the use of renewable energy and reduce energy consumption through energy efficiency. As such, energy transition can be more efficient through digital transformation, which combines technology and ICT in the field of electrical energy. Therefore, the present publication examines the various cases of the digital transformation of utilities and identifies the implications of digital transformation in the transition to clean energy. Moreover, ISGAN Annex 4 aims to convey some messages, such as what the digital transformation means in terms of transition into smarter energy, its potentiality, and the most pressing challenges, to policymakers and related industries.

This paper documents the Annex 2 unified framework for assessment, prioritized assessment results by each Participant, purpose and methodology for multinational (or clustering) analysis, analysis results of common motivating drivers and driver-technology pairs of high priority at the national level as well as across all nations and to nations clustered by economies or by continent, and comparison of multinational prioritized assessment results between the 2014 and 2020 studies.

Highlights of 2020 include:

• Two very fruitful online Ex.Co. meetings, where the following topics were in the main focus:

1) Request for Extension and Strategy process(a strategy process for the preparation of the next phase of ISGAN).
2) Cooperation with other organizations, TCPs, and initiatives

• Based on the successful Knowledge Transfer Project (KTP) approach developed within ISGAN since 2016, a new process design was developed for the Regulatory Sandbox 2.0 Project
• Under the lead of the UK, a new Annex 9 on Flexibility Markets Development and Implementation was approved and officially started on January 26th, 2021.
• The CEM Horizontal Accelerator for “Power System Integration of Electric Vehicle (EV) Infra-structure” is an innovative mechanism strengthening the collaboration and capitalizing on the synergies between four CEM workstreams: the International Smart Grid Action Network (ISGAN), 21st Century Power Partnership (21CPP), the Electric Vehicle Initiative (EVI) & the Power System Flexibility (PSF) Campaign.
• ISGAN and the Power System Flexibility Campaign (PSF) organized a joint workshop “A holistic approach to low emission energy systems through the sector integration” This event took place as an official pre-event of the CEM11/MI-5 Ministerial meeting on Wednesday 16 September 2020.
• The Smart Grid Evaluation Toolkit
• In collaboration with Annex 2 and 7, Annex 4 supported the publication of policy messages on Innovative Regulatory Approaches with Focus on Experimental Sandboxes to Enable Smart Grid Deployment.
• Public SIRFN Webinar on “Testing Methods and Certification Protocols of IEA-ISGAN:SIRFN”,  October 15th, 2020
• SIRFN Fact Sheet  “ISGAN Annex 5 General Brochure”
• Joint SIRFN and related SIRFN member publications
• Micro grids vs Mega grids
• Lessons learned from international projects on TSO-DSO interaction
• inter-Annex Regulatory Sandboxes 2.0 project
• The ISGAN Academy webinars
• The ISGAN Award of Excellence
• Capturing Flexibility in Local Energy Systems Workshop

For the full activity description feel free to download the latest issue of our Activity Report below.

The growth of power generation from Non-Programmable Renewable Energy Sources (NPRES) is accompanied by a progressive decrease of the operating hours of large synchronous generators. This increases complexity and costs, for Transmission System Operators (TSOs), to keep power system operation reliable and secure, since power flows are affected by more variability and unpredictability and, at the same time, less resources are available for frequency and voltage regulation, system balancing support and congestion management.

Thanks to their fast response, flexible control and easy scalability, Battery Energy Storage Systems (BESS) can be part of the solution mix to face such issues, by contributing to the supply of Ancillary Services (AS), both in a stand-alone configuration and in support of NPRES plants and of conventional plants.

AS include traditional ones, originally tailored to conventional power plants, and novel ones, which are gradually being introduced by TSOs to meet the new needs for prompt intervention against system perturbations.

However, services characterized by comparatively slow response times and small power gradients may require large energy contributions, which may be difficult to achieve with the BESS limited energy content, while fast services, despite requiring smaller energy contributions, are not widespread (they have been introduced mainly into isolated power systems) and still lack consolidated regulatory frameworks and remuneration mechanisms. Besides, BESS investment costs, although exhibiting a decreasing trend, are still rather high.

Therefore, techno-economic analyses are needed to understand with what performance (in meeting power exchange requests and in coping with cycling aging) and with what profitability, for their owner/Balancing Service Provider (BSP), BESS could provide single or multiple services together (to look for revenue stacking in case a single service is not enough to reach investment payback).

“Power” versus “energy” services: e.g., with reference to the Italian nomenclature,

• primary and fast frequency regulation versus tertiary frequency regulation/balancing and NPRES imbalance reduction;
• secondary frequency regulation is somewhat in-between.

Remuneration schemes:

• payment for availability: remuneration for power made available (e.g., Italian pilot projects called Fast Reserve and UVAM – virtual eligible units including different kinds of technology; British Enhanced Frequency Response)
• payment for activation: remuneration for energy actually exchanged (e.g., standard AS in Italy, pilot projects in Italy)
• the two forms of payment can be present together (e.g., Italian pilot projects called Fast Reserve and UVAM).

To this purpose, a dynamic response model and a stochastic optimization procedure for BESS sizing and management have been employed in this work. According to the results obtained in the simulations (mainly based on the current Italian market rules and Grid Code specifications),

• “power” services remunerated for activation may not be profitable enough for a BESS, due to the rather small energy exchanges involved (this happens, e.g., for the Italian standard primary frequency regulation). In that case, the presence of a remuneration for the power made available could be fundamental to determine the economic attractiveness of such services.
• For “energy” services, payment for activation can be profitable, due to the rather large energy exchanges involved. The actual profitability is anyway also determined by the energy prices.
  • In the Italian Ancillary Service Market (ASM), e.g., upward/downward prices for secondary and for tertiary frequency regulation (and balancing) seem to be sufficiently high/low respectively, although further analyses of historical market results are needed, to understand the impact of bid acceptance uncertainty on BESS economic results and to inquire whether suitable bidding strategies could be put in place by BESS to become competitive on the ASM.
  • In other European countries, these services can benefit of remuneration both for availability and for activation: e.g., in Germany and in Switzerland, all the services except Frequency Containment Reserve (FCR, which has only an availability payment). In the presence of a double remuneration, higher revenues could of course be expected; however, the specific remuneration prices should be analysed, to understand whether acceptable return on investment could be obtained.

Looking at Europe, the European Commission “Study on energy storage – Contribution to the security of the electricity supply in Europe, Final Report”, March 2020, plus a questionnaire shared among the ISGAN partners show that BESS are undergoing a fast development process, especially in Continental Europe (CE) and in Great Britain (GB). In CE, this process is mainly fostered by the high level of interconnection and by the cooperation among countries for balancing service procurement: such cooperation has already led to an integration of the platforms for energy exchange and balancing service exchange. In GB, electricity markets are very mature and exhibit a high segmentation of AS, aiming at better adapting to power system’s needs, on the one hand, and at creating business opportunities for market operators, on the other hand.

BESS are already present in many European countries, both as large stationary devices and as small distributed ones (and also as electric vehicles). They are often allowed to participate in wholesale energy exchange (on day-ahead/intraday markets) and/or in AS supply (via trading in ASMs in particular). BESS usually provide FCR and automatic Frequency Restoration Reserve (aFRR), sometimes manual Frequency Restoration Reserve (mFRR) and Replacement Reserve (RR); at present, BESS installed power devoted to AS ranges from few MW to some tens of MW to some hundreds of MW; such BESS are managed by few operators, mainly BSPs.

In several European countries, rules for BESS participation in electricity markets are the same as the ones for conventional power plants. Besides, in some countries this participation is allowed only via pilot projects, although BESS can already be aggregated together and also with loads and distributed generators. Work is still needed to overcome barriers to BESS full deployment, e.g. in terms of service technical specifications and performance requirements, market eligibility requirements, remuneration schemes.

Building upon the successes of the first ISGAN initiative on the topic in 2019, the project has resulted in four key Policy Messages to the Clean Energy Ministerial and the wider international energy community. The project was selected to share these results as an official On Demand Side Event of the 12th Clean Energy Ministerial meeting, hosted by Chile.

The Policy Messages have been co-created by experts and practitioners from ministries, regulatory bodies and research institutions in 15 countries on 3 continents through a unique knowledge sharing process combining international knowledge exchange workshops with stakeholder dialogue at national level.

The focus questions that guided the international dialogue included: how sandbox programmes can be integrated into longer term energy transition strategies; the legal preconditions and exemption laws to enable sandbox programmes; how to coordinate between different stakeholders in programme implementation, and how to design evaluation processes for policy learning.

This event is the second ISGAN-PSF joint workshop at the 12th Clean Energy Ministerial meeting. This will wrap up the activities of the PSF and ISGAN. The ISGAN and PSF look at flexible resources through three pillars, market design, digitalisation, and sector-coupling. The event will focus on solutions that have been deployed and the gaps that need to be filled. The event will highlight areas of critical importance to improve power system flexibility, stressing the link between research projects and policy-making.

For more information about the PSF, please visit: Clean Energy Ministerial website

Building upon the successes of the first ISGAN initiative on the topic in 2019, the project has resulted in four key Policy Messages to the Clean Energy Ministerial and the wider international energy community. The project was selected to share these results as an official On Demand Side Event of the 12th Clean Energy Ministerial meeting, hosted by Chile.

The Policy Messages have been co-created by experts and practitioners from ministries, regulatory bodies, and research institutions in 15 countries on 3 continents through a unique knowledge sharing process combining international knowledge exchange workshops with stakeholder dialogue at the national level.

The focus questions that guided the international dialogue included: how sandbox programmes can be integrated into longer-term energy transition strategies; the legal preconditions and exemption laws to enable sandbox programmes; how to coordinate between different stakeholders in programme implementation, and how to design evaluation processes for policy learning.

This discussion paper identifies and consolidates the lessons learned from international projects, use cases, and best practices on TSO-DSO interaction. The results have been obtained from projects that are still in their early phases based on their preliminary findings as well as those that have reached their dissemination stages. Furthermore, this work aims to present a global view of developments of TSO-DSO interaction based on collaboration from stakeholders within the ISGAN community, as well as additional collaboration partners (TSOs, DSOs, project leaders, etc).

The main target audience is focused toward stakeholders who are familiar with the topic and will provide them with an overview and reference towards projects such that the lessons learned can be considered within future projects. The video provides a high-level overview which encapsulates the main findings, while this report forms a supplementary consolidation of the results in order to provide additional information in more detail.

Power systems around the world are faced with a wide range of challenges in order to realize the objective to integrate an increased amount of renewable energy sources in the modern electricity grids. The consequences affect the daily operation and longterm planning of transmission and distribution systems, and the network owners and operator’s ability to ensure continuous, reliable and high quality of supply to the customers. The needs of each actor within the electrical supply chain provide drivers for revision of current practices and promotes future adaptions of functional components and systems, economic and regulatory areas.
This document provides insights in the work of ISGAN Annex 6, in form of key messages consolidated from the views of the focus areas

• Technology Trends and Deployment
• Expansion Planning and Market Analysis
• System Operation and Security
• Transmission and Distribution System Interaction

ISGAN proudly looks back at numerous highlights and achievements in 2019. The activities of ISGAN are organized in Annexes. In contrast to other IEA TCPs, these Annexes are standing working groups that continuously work on Smart Grids-related topics and regularly update their plans and objectives for the upcoming year at the spring meetings of the Executive Committee.

Of particular importance were events and workshops which attracted a very high level of interest both within ISGAN and externally.

• Activities during CEM 10
  • ISGAN and Mission Innovation (MI) Innovation Challenge 1 on Smart Grids (IC1) co-organized the first joint CEM/ISGAN/MI IC1 forum on Cooperation to Accelerate Smart Grid Market Uptake , a full-day  CEM10/MI-4 side event on 29 May 2019 at the Vancouver convention center. There, ministers from over 25 countries gathered to accelerate progress toward a clean energy future.
  • Award ceremony announcing the winning project of the 2019 ISGAN Award of Excellence.
• Highly recognized public workshops back-to-back with ExCo meetings
  • Stockholm: Public Workshop in cooperation with the Swedish Energy Agency and the Swedish Smart Grid Forum: “The future of electricity markets in a low carbon economy”, 2 April 2019.
  • Stockholm: Interdisciplinary workshop with IEA DHC TS3 and ISGAN
  • Montreux: Public Workshop “Needs, challenges and opportunities of TSO-DSO coordination”
  • Montreux: Open workshop “EERA Smart Grid/SIRFN workshop”
  • Annex 6: Open workshop “Micro vs MEGA grids – trends influencing the development of the power system
• Thematic knowledge exchange events (KTP)
  • Experimental Sandboxes for Smart Grids, Stockholm, 2019, in cooperation with the Swedish Smart Grids Forum and ICER International Confederation of Energy Regulators. This event was cooperatively organized by ISGAN Annexes 2, 4, 7 and 8.
  • Focus on upscaling, Montreux, 2019. This project was the third in the series of KTP workshops concerning public funding. It was organized by Annex 2 and 4.
• Development of a communication strategy and action plan
• Public Support to Smart Grid RD&I
• Development of a web-based tool using a combination of CBA and multi-criteria analysis

More details on ISGAN activities in the past year can be read in the full report available online and in print versions.

Disclaimer

This report was prepared by the Secretariat of the International Smart Grid Action Network (ISGAN). ISGAN is organized as the Implementing Agreement for a Co-operative Programme on Smart Grids and operates under the framework of Technology Collaboration Programmes created by the International Energy Agency (IEA). The views and opinions expressed herein do not necessarily state or reflect those of any of ISGAN’s participants, any of their sponsoring governments or organizations, the IEA Secretariat, or any of its member countries. No warranty is ex-pressed or implied, no legal liability or responsibility assumed for the accuracy, completeness, or usefulness of any information, and no representation made that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring.

micro and MEGA represent two trends which largely influence the decisions and the evolutionary process of power grids.

The trends are both aimed at enabling very high penetration of renewable energy sources
in the electric power system, from two perspectives:

• micro focuses on local solutions, while
• MEGA focuses on system or even intra-system wide solutions

ISGAN Annex 6 has dedicated an activity to study the micro and the MEGA trends, with the objective to present a critical assessment of these trends, based on the questions:

• Does one trend outcompete the other?
• Does increased investments from one perspective increase the need for investments
  from the other perspective?
• To what extent can one perspective benefit from the other perspective?

The intention is not to proclaim one solution being superior to another, rather to provide well
informed insights to the needs of considering both perspectives during the planning
and decision-making process for the sustainable development of the wider energy
system.

The outcome of this activity are communicated through publications, presentations and workshops, with contributions from a large number of parties:

• In the Policy Brief: micro vs MEGA – trends in power system development, the condensed knowledge from this activity was published for the 11th Clean Energy Ministerial hosted by Saudi Arabia, September 2020

• In the Discussion Paper (DOI: 10.13140/RG.2.2.11569.61287), the full report is provided from this activity, including detailed insights into the micro & MEGA trends and their perspectives together with experiences from around the World.

• Workshop and meeting in Montreux
  A highly successful event, gathering a total of 30 participants, with presentations (available here) from Italy, India, Spain, Belgium, France, Germany, Norway and Sweden.
  The participants at these two meeting days have shown a high level of engagement and it has been highly valuable to learn from each other. In short, we can conclude that these meetings were very productive and successful in gathering a large amount of knowledge.

In Europe, there is a sharp increase in reserve needs for coping with the variability introduced by a steadily increasing RES share in the generation. The big challenge is to extend the possibility of providing Ancillary Services (AS) – frequency and voltage control, congestion management, etc.) to entities connected to the distribution network.
All these issues have been addressed by the SmartNet European research project (http://smartnetproject.eu/), which aimed at comparing different TSO-DSO interaction schemes and different real-time market architectures with the goal of finding out which would deliver the best compromise between costs and benefits for the system. The objective of this three-and-ahalf year project (2016-2019) was to develop an ad hoc simulation platform which models all three layers (physical network, market and ICT), analysing three national cases (Italy, Denmark, Spain).

In addition to providing information on the main results obtained by the SmartNet project, this report include some information on the status quo of the procurement of ancillary services in selected countries. A questionnaire was formulated and distributed among the members of ISGAN Annex VI. The questionnaire contained the following questions:

• What system services are provided in your country (voltage regulation, frequency regulation, inertia, support to power quality…)
• Who is providing them (generators and/or loads?)
• Modalities to collect ancillary services: via markets, contracts, compulsory non-paid services… Please describe in detail.
• Are generators and/or loads located in distribution admitted to provide system services? If yes, how is TSO-DSO interaction carried out (please describe in detail)
• Are there plans from the national regulator to activate demand side management or to collect inputs from generators connected to distribution for the future? Which timeframe? Are pilot projects already active?

Highlights of 2018 include:

• ISGAN’s activities during the Nordic Clean Energy Week and the Clean Energy Ministerial (CEM9)
  • Workshop and high-level panel discussion on the Acceleration of Smart Grid deployment through innovative market design
  • Side event concerning Perspectives on Smart Energy Storage Systems
• Highly recognized public workshops in course of the programme of the ExCo meetings:
  • Public workshop on Smart Energy for Smart Cities, Newcastle, Australia, as part of the Newcastle Smart City Strategy (ExCo15, Newcastle)
  • 8th International Conference on Integration of Renewable and Distributed Energy Resources IRED2018 (ExCo16, Vienna)
• Thematic knowledge exchange projects (KTP): During ExCo16 in Vienna, a KTP workshop on KPIs in Public Support took place. A Summary of the event was published.
• Award of Excellence:
  • 4th ISGAN Award of Excellence (FY2018) focusing on Flexibility: Award ceremony took place during CEM9
  • 5th ISGAN Award of Excellence (FY2019) focusing on Local Integrated Energy Systems (Smart Microgrids) was launched at CEM9
• Bimonthly webinars organized by the ISGAN Academy and co-hosted by the Clean Energy Solutions Center
• Publication of several discussion papers, event summaries and policy briefs.
• Collaboration and co-operation with other IEA networks and CEM initiatives.

As it is necessary to be quick, regulatory changes will often lag, what is identified as preferable pathways, but these changes could be accelerated through Regulatory Sandboxes, which are able to verify effects of new regulatory instruments before actual implementation.

All energy systems, whether vertically integrated or deregulated, have some sort of regulatory or market oversight. Some of these regulations have been long established and originate from stem out of initial structures created around the turn of the 20th century. However, as the electricity grid transitions towards a more decentralized structure, with deepened engagement of end-users (including consumers) and involvement of a wider variety of other stakeholders and service providers, there is a need to enable testing of new regulatory structures that can better support integration of advanced smart grid technologies and business models.

This casebook provides detailed information on planned or implemented Sandbox Programs for Australia, Austria, Germany, Italy and The Netherlands. An overview of the previously well documented program in the UK is provided as well.

Hawaii is included as an example of another form of regulatory experimentation. In this case, one US state is experimenting with a performance-based method for tariffs which, if successful, can be rolled out as a regulatory innovation to other US states or other countries. The main focus of the casebook however is laid on experimenting to achieve the above mentioned innovation goals by means of sandbox projects.

Solutions providing advances in flexibility are of utmost importance for the future power system.
However, flexibility is not a unified term and is lacking a commonly accepted definition. The flexibility term is used as an umbrella covering various needs and aspects in the power system which complicates the discussion on flexibility and craves for differentiation to enhance clarity.

ISGAN Annex 6 has dedicated an activity on flexibility with the intention to support an increased understanding of the flexibility concept, proposing categorisation of flexibility needs in the power system.

This activity resulted in several publications with contributions from parties in: Sweden, Austria, Canada, France, Germany, Italy, Norway, and Switzerland.

• The final results and conclusions of this activity were presented at a dedicated ISGAN Webinar, November 2019.

• In the Fact Sheet: Grid Evolved – Power System Flexibility, the condensed knowledge from this activity, with collaboration with Mission Innovation, was published for the 10th Clean Energy Ministerial in Vancouver, Canada, May 2019.

• In the Discussion Paper (DOI: 10.13140/RG.2.2.22580.71047), the full report is provided from this activity, including description of the flexibility categories: Flexibility for Power, Flexibility for Energy, Flexibility for Transfer Capacity, and Flexibility for Voltage.

• The Leaflet: Power system flexibility – the ability to manage change presents an executive summary of the discussion paper, giving a good insight into the work. This leaflet was published for the ISGAN Conference The future of electricity markets in a low carbon economy in Stockholm, Sweden April 2019.

• The Scientific paper: Flexibility to support the future power systems, based on the discussion paper, was published for the CIGRE Symposium in Aalborg, Denmark, June 2019.

The purpose of this report is to give an account of a collaborative International Smart Grid Action Network (ISGAN) project on public support and funding to Smart Grid Research, Demonstration and Innovation (RD&I), with focus on the use of Key Performance Indicators(KPIs).

The main objective of this report is to assess the future data exchange and ICT requirements concerning the interaction of distribution and transmission networks, by identifying key challenges that deserve attention.

This report is based on a questionnaire regarding the ICT aspects of TSO-DSO interaction. The questionnaire contained questions regarding technical aspects (e.g. technical connection points between TSO and DSO in the countries), regulatory aspects, flexibility markets, drivers and barriers for TSO-DSO interaction as well as experiences from projects and lessons learned. The questionnaire was sent to the Annex partners and nine responses were collected. In particular Belgium, Germany, Italy, Finland, Sweden, United States, China, India and Austria have sent comprehensive answers.

Due to the integration of renewable energy sources, the interaction between TSOs and DSOs gets more and more important to handle the high volatility of generation and unexpected load growth in power grids. Additionally, new market mechanisms and the connected flexibilities require a closer interaction between TSOs and DSOs.

Smart grid technologies represent different ways to enhance the effectiveness of the power distribution and transmission system by making it possible to use existing power infrastructure more efficiently. Implementation of smart grid solutions could for instance, represent an alternative to investment in new power generation capacity or new power lines.
Many new smart grid technologies are available, but not yet deployed. In order to advance implementation, governments and other investors need decision support to evaluate investments in smart grid technologies.

Cost-benefit analysis (CBA) offers a systematic process for comparing the advantages and disadvantages of a smart grid initiative from society perspective.
This report presents a mapping and analysis of existing literature on social costs and benefits of smart grid solutions and identifies gaps in current guidance. The study also includes a review on how network regulation affects incentives to invest in smart grid technologies and an analysis on how CBA constitutes an important input to the design of the network regulation. The report also serves as a basis for selecting models and methods to be used by the Swedish Smart Grid Forum in order to assess different smart grid projects and applications.

Due to the multifaceted and broad nature of smart grid technologies, CBA of smart grid deployment is complex as smart grid technologies provide benefits on a system level as well as on the project level. Smart grid technologies are also under fast development, which lead to a lack of data and uncertainty when extrapolating results from pilot projects to the system level.

Energy and climate goals as those identified on the European level as well as on a national levels aim to increase renewable energy, improve energy efficiency and reduce carbon emissions. Smart grid technologies contribute to all these goals, not only directly but to large extent indirectly, which calls for comprehensive evaluation methodologies on a system level. Comprehensive analyses on the system level can provide input to CBA.
The aim of CBA is to identify all the gains and losses (benefits and costs) created by an initiative. The intention is to express the gains and losses in monetary terms irrespective to whom they accrue.

On a general level, CBA contains three mains steps. These are identification, quantification and valuation of the benefits and costs.

The purpose of this report is to present an overview of the results from the workshop and high-level panel discussion, “Intelligent market design – boosting global smart grid deployment,” organized by International Smart Grid Action Network (ISGAN) and the Swedish Smart Grid Forum in conjunction with the 9th Clean Energy Ministerial (CEM), 24 May 2018 and as a part of the Nordic Clean Energy Week in Malmö and Copenhagen.
The report gives a summary of the discussions and conclusions from the workshop and includes the background policy brief prepared by representatives from the organizers based on relevant position papers and studies from, for example, ISGAN, IEA, and IRENA as well as individual feedback from ISGAN national experts and the Swedish Smart Grid Forum representatives. The final version presented here also includes input received during the workshop on May 23.

Nowadays, due to the increasing presence of distributed energy resources and the integration of automation and communication technologies the electric power system is evolving towards the smart grid paradigm. Typically, smart grid projects are responsible of wide range impacts which span from the electrical power system to the entire society. Often, these impacts are not easily quantifiable thus an assessment based on their monetary value is not attainable. In this context, traditional approaches as the cost-benefit analysis (CBA) become unfit. The reliable assessment of several planning options can be obtained by using hybrid approaches which combine monetary appraisal tools within a generalised framework based on multi-criteria analysis (MCA). A combined MC-CBA approach preserves the advantages of each methodology while overcoming the respective weaknesses. This report describes the mathematical model of the MC-CBA framework for smart grid projects proposed in previous research activities. This model is exploited by the original software MC-CBA toolkit, which is presented in this document. The MC-CBA toolkit aims at supporting the decision makers by providing an assessment framework which rejects any personal bias by preserving the stakeholders’ interests. In fact, the MC-CBA toolkit allows for an output-based assessment of the smart grid alternatives based on an automated comparison procedure. The MC-CBA toolkit decomposes the decision-making problem by dividing the impacts in three main areas: economic impacts, the contribution towards the smart grid realisation, the externality impacts. The calculation procedure for identifying the best option of the set under analysis relies on the Analytic Hierarchy Process (AHP). In order to illustrate the effectiveness of the MC-CBA toolkit, a case study focused on project selection among different smart grid development plans is presented. More specifically, a set of different upgrading plans based on the Active Distribution Network (ADN) approach and the siting and sizing of distributed energy storage is analysed. The MC-CBA toolkit helps the decision maker to identify the best smart grid investment option; the final aim is to provide a reliable support tool for effectively orienting the investments and the regulatory policies on smart grids.

System efficiency is a multifaceted concept, which in the present document is broken down in the dimensions of carbon dioxide (CO2) emissions, energy and economic efficiency.
In order to improve the efficiency of a given system there are a number of available solutions at the disposal of policymakers and market actors. In this work, five action areas have been chosen and defined – multi-energy systems, electric storage, electric mobility, demand side management and automation & sensor technologies – and a review of activities and initiatives currently underway in several countries has been presented.
The efficiency measures and indicators identified in this report are key for bringing about the vision of an environmentally friendly and economically profitable electrical energy system, although some alternatives are not yet at a stage where they could be readily deployed in a systematic or widespread manner. In these cases and depending on the specific circumstances, regulatory policies and support measures can provide guidance and sustenance to overcome the uncertainties of future developments and promote potentially promising solutions.

13 Jun 2018 @ 14:00 CEST

The webinar deals with distribution planning in the era of smart grids. It is based on the CIGRE WG C6.19 activity. The main topics of the webinar are:

• Role and objectives of distribution planning
• Shortcomings of traditional planning in the current context
• Distribution planning in the era of Smart Grids
  • Load and generation representation, flexibility
  • Probabilistic models for distribution planning
  • Multi objective optimization
  • Smart Grid in distribution planning
• Multi-energy systems
• Cyber-physical simulation
• Example of application and case studies

Watch the webinar or find out more at Leonardo Energy.

The objective of Annex 2 is to assess outstanding examples of current case studies, develop and validate a common case study template and methodological framework, and then develop in – depth case studies using this framework. The template is currently the “Case Book” to contain
descriptive information. The common frame work for case studies will allow comparison and contrast of policies and technologies adopted in different regulatory, legislative, network (grid), and natural environments. The overarching aim is to collect enough information from case studies around the world to extract lessons learned and best practices as well as foster future collaboration among participating countries. The Consumer Engagement Case Book reflects one way that ISGAN brings together experts and stakeholders from around the world to increase the awareness of consumer engagement in the field of smart grid.

Customer engagement and empowerment offers opportunities to save energy for customers and to operate the grid in a more efficient and reliable way for grid operators. Grid operators want to shift or reduce energy consumptions during times of peak consumptions, so they have  engaged and empowered customers to do that by proposing some benefits.
Cases of customer engagement and empowerment in this book share lessons learned in developing and deploying these technologies to  stakeholders.

Therefore, a widespread adoption of active demand1 by households is needed to tilt the cost-benefit balance of the investment in advanced metering infrastructure (AMI) towards a net benefit for society.

Although a variety of interventions aimed at activating households have been piloted in smart grid projects, a consistent and integrated view on how to incentivize end users to change their behavior is still lacking. From an energy policy perspective, it is important to understand key enabling factors that contribute to active demand by households, in order to leverage them by targeted policy interventions. From a research and innovation policy perspective, social innovations and involving end users in the innovation process are important fostering factors to overcome the barriers in bringing smart grid technologies from technological readiness to system wide deployment. This policy brief therefore aims at highlighting key success factors for active household engagement in smart grids. Based on experiences from existing programs and projects, it has become clear that two phases for active end-user engagement need to be distinguished:

• ACTIVATION PHASE, an initial phase of end-user engagement and a
• CONTINUATION PHASE, to enable the entrenchment of the newly acquired energy behavior.

For each of the two phase’s, diverse success factors were identified, with the main conclusion that a more differentiated, phase-sensitive view is needed on how to encourage greater user engagement through policy measures.

As the aim of ISGAN is to facilitate global knowledge sharing, this policy brief intends to disseminate these finding on user-engagement to a broader audience of policy makers dealing with smart grid policy.

We are pleased to inform you that the executive summary of India KTP workshop is now available for download as attached.

The FPS Economy, SME, Self-Employed and Energy – DG Energy & EnergyVille, would like to invite you to the public workshop of the International Smart Grid Action Network (ISGAN):

Building the flexible power systems.
From analog to digital, from lorry to EV, from customers to prosumers

12 September 2017, 09:30-18:00

All over the globe, governments have set ambitious targets for the deployment of renewable energy sources. Unlocking the full flexibility potential throughout the power system is essential to enable these objectives. This ISGAN public workshop gathers world-class speakers from international organizations, public authorities, utilities and research institutes to exchange views on current and  future energy policies, to showcase best practices and to bring together experts in various technologies to come to a power system vision.

At Thor Central
Thor Park 8000
3600 Genk
Belgium

The world’s electricity systems face challenges, including ageing of infrastructures, continued growth in demand, integration of variable renewable energy sources and plug-in electric vehicles, the need to improve the security of supply as well as the need to lower carbon emissions. Smart grid technologies offer a way to meet these challenges and to develop a cleaner and more efficient energy supply. However, national and regional circumstances, such as available sources of supply, grid structure and legislative and regulatory conditions, will give rise to a substantial diversity in the implementation of different smart grid technologies and system solutions.

In order to be able to disseminate experiences and conclusions regarding costs and benefits of these different projects in an efficient and systematic way, a framework for socioeconomic cost-benefit analyses in relation to smart grid solutions needs to be developed. Knowing ex-ante how the socioeconomic effects are distributed can support the design of new policies, the reformation of the regulatory framework as well as the prioritisation of initiatives, and shed light on gaps in research.

This report analyses the distribution of costs and benefits primarily in relation to decentralized electricity consumption on the residential level. The aim is to discuss whether social imbalances are induced by shifting the burdens of financing the grid towards lower income classes. Such imbalances may be aggravated by the tendency to go off grid, thereby challenging current cost recovery schemes.

Socioeconomic analyses are those that aim at identifying differences between groups of people that share similar characteristics like their level of education, employment status, living condition, occupation and income, among other. When assessing smart technologies and regulatory regimes in the context of smart grids, socioeconomic analyses highlight their associated social impact, thereby looking at how related measures affect energy consumption, income and wealth distribution, equity and participation.

The report especially focuses on the question how own, decentralized electricity production changes pricing and tariffing schemes and which socioeconomic factors should be taken into account when designing new cost and benefits models to analyse and assess investments in smart grids related technologies and smart grid regulation.

Energy consumption (in kWh/a) for different types (left) and sizes (right) of households

However, rather than being able to provide ready-made answers about the institutional and social dimensions of smart grids, much more can be said about what-we-don’t-know. We identified two main reasons why we do not know enough about smart grid transition.

1. The structural challenge is that energy research is mainly focusing on technologies for the physical grid with little knowledge on institutional change and the social dimension of energy transition.
   In an article in Nature, B.K. Sovacool (Vol 511, 2014) examined the scope of more than 4400 articles in leading energy technology and energy policy journals over 15 years. He identified four trends which he evaluates as worrisome if not tackled by public and private organizations and the scientific community:
   a. An underevaluation of influence of social dimensions on energy use,
   b. A bias towards science, engineering and economics over other social sciences and humanities,
   c. A lack of interdisciplinary collaboration and
   d. The underrepresentation of female authors or those of minority groups
   This corresponds to the challenges identified in developing a strategic research agenda for Smart Grids Transitions of Annex 7. The European Commission in its Horizon 2020 research and innovation program tries to address this issue by encouraging SSH research to be taken up in energy research projects. An interim evaluation2 shows the low level of SSH research with the main part going to economic research. Other disciplines are hardly visible and there is a significant geographical divide between countries in taking up the possibility to integrate SSH research.
   There is the need to insert the social and environmental dimensions in the projects of smart grid deployment as well as in the decision making processes needed to select the most appropriate solutions. It is not enough that projects be perfect from the technical and economics point of view, they should be based on a sound social analysis and include specific actions to take into consideration the concerns, needs, and expectations of citizens and consumers.
2. Although the political will to further increase the public energy-R&D investment in the CEM countries substantially exists, statistical evidence shows a stagnation of energy related social-science-humanities R&D investment at a very low level.
   R&D statistics (OECD/IEA, EU – Horizon 2020) indicate that increases in public R&D spending over the last years did not lead to a more balanced resource-attribution for all research disciplines. Particularly, research resources for social sciences and humanities (SSH) have not yet received the attention it would require to learn more about embedding technological development in the economic and societal environment (e.g. on energy use, or on how future markets will look like).3
   Although the obstacles of data accuracy exacerbate the analysis, still two statements can be made:
   a. The share of R&D from SSH in the area of energy4 in OECD countries has been fluctuating significantly over the last years. When adding up all reported country figures between 0.1% and 9% during the period of 1974 and 20155.
   b. If at all, SSH-research capacities and funding in absolute terms is growing with much less speed than in engineering and natural sciences.
   Given the high uncertainties, how global energy transition should take place and the lack of orientation where technological development should lead to, SSH research will be needed even more urgently than in times of relative stability of the energy system.
   The intention of Mission Innovation, to double public clean-energy R&D investment over five years, is an encouraging signal for R&D actors and will likely lead to structural changes in the research and innovation-eco-system. However it remains to be seen, if this could also lead to a substantial rise in the knowledge about the social dimension of smart grids, without a political will to provide significant resources for SSH research as well as the appropriate R&D instruments.
   The following conclusion and recommendations can be drawn from this analysis:

• Significantly more inter- and transdisciplinary research activities in social sciences and humanities are needed.
• More attention has to be laid on generating know-how on social dimensions of technological and institutional transformation of energy systems and markets.
• Financial resources for SSH research need to be raised at least as much as for technological development and the respective R&D capacities and infrastructures need to be built up sustainably. Collaboration and strategic research agendas should be coordinated amongst CEM-countries.
• There is an urgent need for more accurate statistical data on SSH in energy research.

In this work, the concept of a single marketplace for flexibility is introduced. Based on the requirements for TSO-DSO interaction, the concept of a single marketplace for flexibility has been assessed. This assessment does not provide a comparison with other ways to ensure a coordinated use of flexibility, but it shows the strengths and weaknesses of a single marketplace for flexibility.

The single marketplace is a lean and transparent concept to deal with the procurement of flexibility, which could theoretically lead to an economical optimum for the entire system, while respecting technical boundary conditions. On the other hand, the marketplace will not function properly without sufficient flexibility offers, there is no practical experience with this concept and the ICT requirements for its implementation are challenging.

ISGAN Policy Messages for CEM

Developed countries face problems with an aging infrastructure. Across this landscape of change, it is crucial for policy-makers to understand the synergies between grids and information and communication technologies. Only smart and strong grids will connect people with reliable clean energy.

The case book Spotlight on Smart and Strong Power T&D Infrastructure highlights experiences of countries in different parts of the world, as they performed transmission and distribution projects on their electrical systems. The projects illustrate a wide range of applications, solutions, and technologies that were used to meet the challenges that various countries were facing. Many of the projects focused on the need to manage the integration of large amounts of renewable and often intermittent energy sources.

Additional projects will be added progressively in future editions of the case book.

The first edition of the case book was published in 2015. It includes eight cases, based on information collected during 2014 and 2015.

The second edition was published in 2016 and contains an aditional five cases. Case book summaries in Spanish and English are provided for the second edition .

The International Smart Grid Action Network (ISGAN) creates a mechanism through which stakeholders from around the world can collaborate to accelerate the development and deployment of smarter electric grids.
This report summarizes an international event organized by ISGAN; the National Smart Grid Mission; the Ministry of Power, Government of India; and the Central Power Research Institute, titled “Knowledge Exchange on Distributed Generation, Microgrids, and Smart Metering.” This report describes the programme of events and gives a summary of conclusions from an interactive knowledge exchange workshop and public conference that took place 13-15 November 2017 in Bengaluru, India, with 100 participants of which c. 20 international experts.

The impacts generated by the smart metering infrastructure (or Advanced Metering Infrastructure, AMI) are evaluated by means of a tailored MC-CBA approach. In particular, the state of art in Italy of smart metering for low voltage consumers is presented and analysed. The aim of this document is twofold. Firstly, the proposed MC-CBA methodology is applied to a smart grid asset case study. Secondly, the assessment is made by means of a cross-platform which integrates the MCA approach and the ISGAN CBA toolkits. The decision-making problem of identifying the best AMI alternative is modeled as a hierarchical structure of evaluation criteria. Three different area of interest are investigated: economic effects, enhanced smartness of the grid, and externalities. The most suitable criteria are selected to obtain an effective assessment framework and avoid double counting. Firstly, the AMI case study is evaluated by means of the Analytic Hierarchy Process (AHP) technique. The same MCA approach has been applied by using the ELECTRE III technique and the ELECTRE III technique succeeding a fuzzy-scoring method. Finally, the obtained results are compared and the observed peculiarities of the used MCA techniques are described. In particular, the evolutive AMI alternative is always pointed out as the best. On one hand, the AHP appraisal seems to be suitable for preliminary decision-making analysis. On the other hand, the ELECTRE III method appears to be suitable for a deeper analysis of the decision-making problem.

Energy access constitutes one of the fundamental building blocks for economic growth, as well as social equity, in the modern world.

Access to sustainable energy is needed to achieve sustainable development. This paper serves as an input document to the global discussion on how to reach the UN goal of “Sustainable Energy for All”, by sharing case study knowledge in the field. The following topics are considered through the examination of several implemented cases from different parts of the world:

• Analysis of the interaction between centralized grids and microgrids.
• Analysis of stakeholder decision parameters for electrification through extension of the central grid or microgrids; such as distance from grid, economic feasibility and environmental sustainability.
• Analysis of design differences and requirements for microgrids, based on intended purpose and the needs of the end customer.

It has been determined that good planning, appropriate requirements and clear regulations for microgrids limit the risk of stranded assets and enable better business cases for the involved stakeholders.

The purpose of this report is to give an account of a collaborative International Smart Grid Action Network (ISGAN) and the 21st Century Power Partnership (21 CPP) project focusing on
Mexico’s path towards smart grids and grid modernization. This report describes the programme of events and gives a summary of conclusions from an interactive knowledge exchange workshop and public conference that took place 17–19 August 2016 in Mexico City.

A synchrophasor is a time-synchronized measurement of a quantity described by a phasor. Like a vector, a phasor is a complex number that represents both the magnitude and phase angle of voltage and current sinusoidal waveforms at a specific point in time. Devices called phasor measurement units (PMU) measure voltage and current, and with these measurements, calculate parameters such as frequency, real power (MW), reactive power (MVAR) and phase angle. Data reporting rates for these parameters are typically 30 to 60 records per second, and may be higher. In contrast, current supervisory control and data acquisition (SCADA) systems typically report data every four to six seconds – over a hundred times slower than PMUs.

Measurements taken by PMUs in different locations on the network are accurately synchronized with each other and can be time-aligned, allowing the relative phase angles between different points in the system to be determined as directly measured quantities. Synchrophasor measurements can thus be combined to provide a precise and comprehensive “view” of an entire interconnection, allowing unprecedented visibility into system conditions.

The number of PMUs installed worldwide, as well as the number and type of grid operations informed by PMU data and applications, have seen notable increases in recent years. The past six years have seen a significant increase in the number of PMUs installed across North America’s transmission grid, from fewer than 500 installed in 2009 to nearly 2,000 today. This rapid increase in deployment of PMUs was spurred by the 2009 American Recovery and Reinvestment Act (ARRA), which funded federal Smart Grid Investment Grants (SGIG) and Smart Grid Demonstration Projects (SGDP), with matching private funds. In Norway, responsibility for the deployment of PMUs has recently been assumed by the Transmission System Operator’s IT division, meaning that PMUs are becoming an integral part of the grid information infrastructure for system operations.

The case book Spotlight on Smart and Strong Power T&D Infrastructure spotlights a number of projects sharing best practices to meet challenges for the power systems to become stronger and smarter.

Many different approaches are possible to meet these challenges and the regulators have a key role in supporting the development towards clean sustainable solutions.
Different countries have different challenges, will use different solutions to those challenges, and have reached different maturity in the implementation of those solutions. Smart grid solutions are also found across the entire electrical system, from the high voltage transmission grid, through the distribution grid and finally on consumer level. It is therefore no generic solution or size that fits all for the solution towards the smart and strong grid. At the same time there are generic solutions and findings from experiences that can be adapted by other countries to make local implementation faster and more efficient.

Higher flexibility in network dispatching can be achieved either by increasing the deployment of bulk storage in the transmission network, or by widening the set of resources available as a base for energy balancing. The latter strategy could potentially be actuated by allowing reserve procurement across transmission operator jurisdictions.

In a European context this strategy would be referred to as trans-national balancing; and could also be relevant to procurement across different Regions and Balancing Authorities in North America. A further positive could be achieved through participation in the balancing mechanism from generators and loads located in distribution networks. Beyond supporting dispatching efficiency, these flexibility elements make it possible to deploy a sustainable expansion strategy of the trans-national transmission corridors, taking into account the current difficulties faced in achieving public consensus for the building of new overhead lines. This report illustrates the potential of these strategies by referencing the results achieved in a number of important and ongoing European research projects.

Energy Access constitutes one of the fundamental building blocks for economic growth as well as social equity in the modern world. Access to sustainable energy is needed to achieve sustainable development.

Through examination of several implemented cases from different parts of the world the following topics are considered: i) Analysis of the interaction between centralized grids and microgrids ii) Analysis of stakeholder decision parameters for electrification iii) Analysis of design differences and requirements for microgrids, depending on the intended purpose and the need of the end customer. It is determined that good planning, suitable requirements and clear regulations for microgrids (in relation to centralized grids) limits the risk of stranded assets and enables better business cases for the involved stakeholders.

This report describes the programme of events and gives a summary of conclusions from an interactive knowledge exchange workshop and public conference that took place 17–19 August 2016 in Mexico City.

Examples of these trends are the electrification of energy consumption and the increasing volume of distributed generation being connected to the distribution grid.

The relationship between transmission system operators (TSO) and distribution network operators (DSO) is changing. Examples of these trends are the electrification of energy consumption and the increasing volume of distributed generation being connected to the distribution grid. In Europe this subject is highly relevant as pointed out by ENSTO-E (European Network of Transmission System Operators for Electricity) in their paper, Towards smarter grids: Developing TSO and DSO roles and interactions for the benefit of consumers published in March 2015, and ACER (Agency for the Cooperation of Energy Regulators) in their conclusions paper, Energy Regulation: A Bridge to 2025 published in September 2014. ENTSO-E is an association which represents 41 European TSOs and has an objective to promote closer cooperation across Europe’s TSOs to support the implementation of EU energy policy objectives of affordability, sustainability and security of supply. ACER is an agency of the European Union with the overall mission to complement and coordinate the work of national energy regulators at EU level, and to work towards the completion of the single EU energy market for electricity and natural gas. The expected increased interaction between TSOs and DSOs will result in both technical and non-technical challenges.

IEA ISGAN Annex 6 has published a discussion paper in which the current and future cooperation between TSOs and DSOs has been investigated. Six critical grid operation challenges have been identified:
1. Congestion of the transmission-distribution interface
2. Congestion of transmission lines and distribution lines
3. Voltage support (TSO↔DSO)
4. Balancing challenge
5. (Anti-)Islanding, re-synchronization, and black-start
6. Coordinated protection

For each case, country experts provided first-hand information about the status and expected development of TSO-DSO interaction in their respective countries. This resulted in an overview, by country, of the interaction between grid operators and provided input for the discussion about how this interaction could evolve in years to come. Technical aspects, as well as policy aspects, have been taken into account.
The technical solutions required for a closer interaction between TSOs and DSOs are very similar for most of the identified cases, except for the case of islanding & black-start. From a high level viewpoint, grid monitoring has to be implemented, communication between TSO and DSO has to be established and means of communication between the DSO and its flexible customers have to be available. DSOs should also be able to perform (quasi) real time network simulations with input from measurements on the grid.
Such technical requirements should not be underestimated regarding implementation and operational cost, complexity and skills required. These could be a challenge, especially for smaller distribution network operators. Nonetheless, only the distribution grid operator has information about the actual grid configuration and grid loading. This means that even when other entities take up certain roles, for example the role of aggregator, the distribution network operator will always be responsible for monitoring the grid and will need to implement communication solutions to one entity or another.
With the current status of technology, technical requirements for an evolved interaction between TSOs and DSOs can be met. However, several non-technical issues, or points of discussion, have been identified which are closely related to the regulated environment grid operators are working in.

• Maintaining a balance between infrastructure investments and use of flexibility

Flexible demand and generation can be used to support grid operation and avoid infrastructure investments. A minimum use of flexibility will be necessary to avoid over investing, but the impact on the processes and business cases of flexible customers has to be limited. The flexibility available by curtailing renewable energy sources needs to be limited to avoid a high loss of renewable energy.

• The role of markets
Which grid operation challenges should be met by introducing markets and which should be managed only by technical means and appropriate bilateral contracts? It is proposed to use market mechanisms only for the balancing challenge, which is applied today in various countries. Coping with local grid operation challenges such as critical transformer loading, line loading and voltages, is proposed to be managed by the network operators, optimally interacting with each other and using flexible customers when necessary. Because of the local nature of the mentioned grid operation challenges, markets would not work efficiently. Instead, a regulatory framework is required for bilateral contracts between flexible customers and network operators, facilitating the use of flexible generation and demand for grid operation purposes.

• Setting a level playing field for flexibility
When the combined flexibility of customers on the distribution and transmission grid is used, favoring one set of customers at the cost of the other should be avoided. For example, when facing critical line loading on the transmission grid, the use of flexibility of only distribution connected customers would be undesirable. Some mechanism, probably in discussion with the regulator, should be implemented to cope with this.

• The role of regulation
Closely related to the previous statement is the discussion point on how grid operation should evolve:
more regulated, with clearer and stricter roles, or more open, with guaranteed interaction between grid operators and new market players? There is no one size fits all solution but in any case, a clear definition of the roles and responsibilities of all participants in future grid operation will be necessary and will serve as a good start.
A clear policy framework will, in every case, push forward investments in Smart Grid solutions to deal with the discussed challenges that grid operators are facing.
The article is based on a discussion paper published by IEA ISGAN Annex 6.

Smart grid technologies offer new options for integrating variable RE, yet technology is not the only important area of focus—innovative policy, regulation, and business models are needed to incentivize and implement next-generation grid architectures.

This discussion paper explores the intersection of smart grid technology, policy, and regulation from a non-technical point of view, focusing on some specific questions relevant for decision makers:

• What are the challenges of integrating variable RE into power grids?
• What types of smart grid solutions are emerging to integrate variable RE?
• What are good examples from around the world of smart grids aiding in the integration of variable RE?
• What types of policy and regulatory approaches are emerging to support smart grid solutions in relation to RE?

Based on emerging case studies from around the world, this discussion paper concludes that smart grids offer solutions to various challenges associated with variable RE, including
providing additional flexibility, unlocking demand side participation, and deferring more costly grid upgrades.

The case book Spotlight on Smart and Strong Power T&D Infrastructure spotlights a number of projects sharing best practice in how to meet the challenge to develop the electricity network to become stronger and smarter using different approaches.

For example how:

• Existing and new AC power transmission lines can carry more power by the use of smart technologies such as WAMS and Synchrophasors.
• HVDC lines with Voltage Source Converters can be used for interconnectors that also support the existing grid e.g. by avoiding voltage collapse.
•  The use of smart voltage control concepts can increase the hosting capacity for distributed energy resources

Questions relevant for decision makers:

• What are the challenges of integrating variable RE into power grids?
• What types of smart grid solutions are emerging to integrate variable RE?
• What are good examples from around the world of smart grids aiding in the integration of variable RE?
• What types of policy and regulatory approaches are emerging to support smart grid solutions in relation to RE?
• Based on emerging case studies from around the world, this discussion paper concludes that smart grids offer solutions to various challenges associated with variable RE, including providing additional flexibility, unlocking demand side participation, and deferring more costly grid upgrades.

This report is an update of a 2012 ISGAN Annex 4 report entitled “Smart Grid Contributions to Variable Renewable Resource Integration.”

To meet the required objective of this Annex, a program of work is designed and it includes the following three tasks:

• Task 1: Assess Current Network Maturity Model and Update data
• Subtask 1.1: Trial application of two network maturity analysis tools and results discussion
• Subtask 1.2: Development of the questionnaire for the assessment of the level of smartness of transmission and distribution networks

• Task 2: Analyze Current Benefit-Cost Analytical Methodologies and Tools
  • Subtask 2.1: Analyzing benchmark benefit-cost frameworks and tools
  • Subtask 2.2: Model research to overcome limit of current BCA frameworks and tools
• Task 3: Develop Toolkits to Evaluate Benefit-Costs
  • Subtask 3.1: Development of Simplified cost-benefits analysis tool
  • Subtask 3.2: Technical Analysis of current BCA took-kit and Modification of Simplified tool-kit

For Task I, the report goes through several maturity frameworks available, especially those of Software Engineering Institute (SEI) and Katholieke Universiteit Leuven (KUL). The SEI has developed a management tool that can be used to measure the current state of a smart grid project, aiming to help utilities to identify the target and build proper strategies to reach it. The tool, Smart Grid Maturity
Model (SGMM), utilizes a set of surveys called Smart Grid Compass. The drawback of this tool is the undocumented scoring method of the surveys once a result is obtained. Full assistance of an SGMM Navigator is required for the utility to understand and analyze the SGMM output. Meanwhile, the KUL introduce the characteristics, categories and key performance indicators of a smart electricity grid. The previous report also includes own survey methods developed by Annex III, although there has not much of progress after that.

For Task II, an extensive update of the BCA survey has been provided in the previous report. It started with various frameworks related to BCA, which include Frontier Economics and the Smart Grid Forum (SGF) in UK, Smart Grid Investment Model (SGIM) of SGRC, I
MPLAN Model, McKinsey Tool, and general overviews of EPRI’s methodology to BCA and its subsequent developments by DOE and JRC. After that, several BCA applications to country-specific or states cases are summarized. Some of the surveyed countries are Czech Republic, Netherland, Lithuania, Denmark, and USA states. For the comparison purpose, the summary for each case is carried out following some key points: background of the smart grid project, the methodology or toolkits used, the scope of the project (location, period, technologies), the list and definition of benefits and costs, and deliverables (results, recommendations, policy andregulations). The 1st year’s work of Task II can be compared with the previous year’s work in the sense that how EPRI guideline has any impact on the work development of JRC and DOE frameworks, especially for the Smart Grid Computational Tool (SGCT), a BCA toolkit that is developed by US DOE. This report summarizes the findings from the previous works with the focus of selecting the benchmark smart grid tool kit for the development of own ISGAN tool kit for member countries.

For Task III, a simplified cost-benefit analysis tool is being developed taking SGCT of DOE as a benchmark tool kit, based on the previous year report on the development plan of ISGAN member countries’ toolkit. A standalone program based on Object Oriented Programming (OOP) is now being developed replicating, revising and upgrading the currently available excel-based SGCT. As will be discussed, this tool kit has various advantages over other tools: First, this tool is open to public and anyone can take a look inside of the model deep enough to examine the visual basic application modules. JRCEU, McKinsey models were once discussed in Annex III before for any potential utilization for ISGAN member countries’ tool kit. However, members acknowledge the fact that JRC works on excel based format and there seems to be not much difference between JRC’s work and DOE. The difference lies in the fact that JRC never opened up the details of the functionalities and sample calculation of BC in their whole work process. McKinsey software was discussed but it is not open to public. Rather it is a commercial package with no specific advantage over to SGCT of DOE. Detailed engine is not fully explained and the scope of the analysis the tool kit provides does not seem to be very useful (Nigris 2012, Kim 2013). The new tool kit being developed is named for the time being as ‘Replicated Tool Kit’ for convenience. Through the replication process, a lot of details have been identified, which, otherwise, would not have been known to us. Many of the parameters utilized in the process of benefitcalculation may be required to be collected from outside, reflecting the region specific characteristics. Some of the default values provided by SGCT, although they are from USA case (refer to Appendix), may also be useful until those detailed information becomes available for ISGAN member countries even when they don’t have them.

In addition, there a at least 12 smart grid projects currently being conducted in USA (refer to III.2.24), and those projects are starting to produce some detailed information which might be potentially utilized by current SGCT. Not only those advantages, there are many interesting researches being conducted around the world and the work results could be very useful sources of updating this replication effort in the future, once this replication process allows us to identify the pros and cons of the current model. The last chapter of the Expansion of Smart Grid Computational Tool is the wild idea of what could be accomplished in this whole process of simplified own ISGAN tool kit for member countries. Some of the ideas for the tool kit development become clearer as the process of the replication progresses. By the time of the completion of this year’s work, we hope to have a very concrete idea on how to proceed to further develop this current work in the future for the benefit of every member country in ISGAN.

Energy access constitutes one of the fundamental building blocks for economic growth as well as social equity in the modern world. Access to sustainable energy is needed to achieve sustainable development. A microgrid should not be seen as a competitor to the centralized grid but as a complement.

Through examination of several implemented cases from different parts of the world the following topics are considered:

• Analysis of the interaction between centralized grids and microgrids
• Analysis of stakeholder decision parameters for electrification
• Analysis of design differences and requirements for microgrids, depending on the intended purpose and the need of the end customers

It is determined that good planning, suitable requirements and clear regulations for microgrids (in relation to centralized grids) limits the risk of stranded assets and enables better business cases for the involved stakeholders.
The paper is based on the discussion paper The role and interaction of microgrids and centralized grids in developing modern power systems – A case review publiced by ISGAN (International Smart Grid Action Network) Annex 6: Power T&D Systems.

Each case presented has its own unique set of characteristics and drivers, which is indicative of the diverse range of motivating drivers for smart grid and AMI globally.

The lessons learned and best practices presented in the six case studies included in this case book provide qualitative insights into the potential costs and benefits of advanced metering infrastructure (AMI), and the associated business cases for investment. Each case presented has its own unique set of characteristics and drivers, which is indicative of the diverse range of motivating drivers for smart grid and AMI globally. It follows then that the specific costs, benefits and business cases vary from case to case. Still. there are a number of best practices and common themes emerging from these cases that are likely to be useful for any jurisdiction investigating or deploying AMI.Those common best practices and insights are presented here.

It should be noted that these six cases represent only a portion of global experience in considering and deploying AMI. In addition, AMI is only one system of technologies among a broad menu of options that can constitute a “smart grid.” Some countries consider an AMI a prerequisite for their smart grid, while others have dismissed the importance of AMI to grid modernization. Additional cases have been solicited or are under development that will enlarge global understanding of the role AMI can play as one possible component of smarter electricity networks worldwide.

Building on the lists of smart grid motivating drivers and technologies that were used for the 2012 survey, the assessment framework in 2014 was developed with slight refinements to reflect review feedback from current ISGAN Participants. The refined framework (i.e., lists of drivers and technologies) was then programmed into an online survey tool for use by each Participant to complete the assessment. Each Participant’s survey results were subjected to a validation process by that country’s national coordinator for Annex 1. A clustering analysis methodology was developed and applied to derive the composite, national-level prioritized assessment results from survey results (those approved through validation, or completed but not yet validated) from multiple respondents for a country. The same methodology was further applied to groups of multiple Participants’ prioritized assessment results to identify motivating drivers and technology priorities at a multinational level. Clustering analysis for the group of all ISGAN Participants, as well as of Participants grouped by economies (developed and developing) and by continent (Africa, Asia, Australia, Europe, and North America), was conducted; these multinational-level prioritized assessment results are provided herein. Lastly, application of national-level and multinational-level prioritized assessment results for selecting each country’s smart grid projects for the ISGAN Inventory and for further information dissemination via the ISGAN Smart Grid Project Webinar Series is described.

Evolutions in the grid operation sector will require an ever closer cooperation between Transmission System Operators and Distribution System Operators. The current interaction between TSOs and DSOs has been investigated for six specified grid operation challenges, and possible future ways of cooperation have been identified. Technical aspects as well as policy aspects have been taken into account.
The technical requirements for an evolved interaction between TSOs and DSOs can be met using available technology. However, several non-technical issues and points of discussion have been identified, of which some are related to the regulated environment grid operators are working in.

A growing amount of variable renewable energy generation, coupled with increasing consumer involvement through micro generation and flexible demand management, challenge the old ways of planning, operating, and investing in power systems.

In most developed countries, the existing electric infrastructure and workforce is rapidly aging, while in many developing countries, demand for electricity is rapidly rising. Across this landscape of change, it is crucial for policy-makers to understand the synergies between grids and information and communication technologies. Only smart and strong grids will connect people with reliable clean energy. This paper presents a part of the work being done within ISGAN Annex 6 on Power T&D Systems. International Smart Grid Action Network (ISGAN) is an initiative within the Clean Energy Ministerial (CEM) and an Implementing Agreement within the International Energy Agency (IEA). For more information please go to www.iea-isgan.org, or www.cleanenergyministerial.org/Our-Work/Initiatives/Smart-Grid.

This work involves the major economies and consequently major energy users in the world and is addressing the challenges for a secure and clean energy system including the concerns put forward by Intergovernmental Panel on Climate Change (IPCC). IEA publish regularly the reports World Energy Outlook (WEO) and Energy Technology Perspectives (ETP). In addition IEA has published a number of Technology Roadmaps, e.g. on Smart Grids, Wind Energy, Concentrating Solar Power (CSP), Solar PV Energy and Energy Storage. All scenarios showed by IEA are indicating a further increase of electricity as energy carrier both due to the integration of Renewable Energy Sources (RES) and due to increased electricity consumption in many countries, besides common applications also due to increased use of home electronics, heat pumps, air conditioning and electrical transportation (e.g. electrical vehicles, high speed trains). Increased variable electricity production (large scale and distributed) will require mitigation from storage and/or demand response. This will give further demands for capacity, flexibility and reliability of the future power T&D system.

Energy access constitutes one of the fundamental building blocks for economic growth, as well as social equity, in the modern world. Access to sustainable energy is needed to achieve sustainable development. This paper serves as an input document to the global discussion on how to reach the UN goal of “Sustainable Energy for All”, by sharing case study knowledge in the field. The following topics are considered through the examination of several implemented cases from different parts of the world:

• Analysis of the interaction between centralized grids and microgrids.
• Analysis of stakeholder decision parameters for electrification through extension of the central grid or microgrids; such as distance from grid, economic feasibility and environmental sustainability.
• Analysis of design differences and requirements for microgrids, based on intended purpose and the needs of the end customer.

It has been determined that good planning, appropriate requirements and clear regulations for microgrids limit the risk of stranded assets and enable better business cases for the involved stakeholders.

These case studies are based on a diverse range of technologies and under specific market rules. They incorporate various program and policy mechanisms and include information on costs and the associated business cases for investment. Each case presented has its own unique set of characteristics and drivers, which is indicative of the diverse range of drivers for smart grid and DSM.

The cases are at very different stages throughout the world. While some countries have completed first rounds of pilots and are building on lessons learned, the others are at earliest stage of these initiatives. The size, customer class, choice of technologies deployed, specific costs, benefits and business cases vary from case to case. Still, there are a number of best practices and common themes emerging from these cases that are likely to be useful for any stakeholder investigating or deploying Demand Side Management. Those best practices and insights are presented here.

The key findings are a synthesis attempt of the broad range of the approaches tackled by the different smart grid demonstrators described by the 12 cases. It highlights the main lessons learned and best practices shared by the participating cases. These lessons learned mainly concerns technical approaches, customer engagement and market establishment.

Changing patterns of demand that new types of load such as electric vehicles (EV) will introduce large and unpredictable fluctuations in the power balance as well as variations in voltage can jeopardize the quality and availability of power. The T&D system has to be stronger and smarter to provide the real-time flexibility needed to efficiently handle the new conditions. Investment needs in the power T&D infrastructure are large and require long term planning and deployment. The environmental concerns and public acceptance issues that often arise when constructing additional conventional transmission lines will require more efficient solutions with lower environmental impact.

This Discussion Paper from ISGAN Annex 6 Power Transmission & Distribution Systems Task 3 and 4 focuses on “Smarter & Stronger Power Transmission” and is a review of feasible technologies for enhanced transmission capacity and flexibility in terms of status and deployment. This includes both the primary AC and DC technology for the high voltage transmission grid as well as the information and communication technology (ICT) required to efficiently supervise and operate the power system. Focus is on the development of power electronics including flexible AC transmission (FACTS) and high voltage DC (HVDC), the standardization within ICT such as IEC 61850 and Common Information Model (CIM) in order to obtain vendor independent interoperability as well as the progress of wide area monitoring, protection and control (WAMPAC). The combination of smarter ICT applications together with power electronics such as FACTS and HVDC can be described as a digitalization of the power system operation offering the required flexibility. Most of the examples given are from the Nordic European power system, reflecting the participation of the authors from ISGAN Annex 6 Task 3 and 4, with additional input from North America and selected International case studies.

The diversity of islands of developing and developed nations offers a unique opportunity to demonstrate how deploying large amounts of intermittent renewable energy sources (RES) within smart grid architectures tailored to local energy contexts can be a cost-effective complement, and even an alternative, to current fossil-fuel solutions.

This paper, authored by Annex 4: Synthesis Insights for Decision Makers, covers the following topics:

• The energy supply challenges faced by islands
• Ways in which renewable energy technologies can improve sustainable electricity supply
• Ways in which smart grid technologies can help enable the integration of large amounts of intermittent RES
• Lessons learned from demonstration projects in islands
• The importance of island systems in the global context of clean energy systems in developing and developed countries.

Development of the inventory followed the ISGAN framework of assessment, during which smart grid drivers and technologies were assessed by each ISGAN Participant based on their respective national-level priorities.

Information on ongoing and planned smart grid projects that respond to national-level priorities was then collected from each Participant as input to the inventory. The inventory, constructed in Microsoft Access and Excel, adopted the data fields and their organization used by the European Commission Joint Research Centre-Institute for Energy and Transport (JRC-IET) survey of smart grid projects with slight modifications. Harmonization of database content between the JRC-IET database and the inventory is readily achieved, while the inventory allows each ISGAN Participant to independently conduct query and analysis of smart grid projects.

Cataloguing of the projects in the inventory is presented in a two-part report. Part 1 organizes smart grid projects by each main application; whereas, Part 2 organizes the inventory projects by their contribution to policy goals. The “project main applications” and “policy goals” in the inventory are in close association with the “smart grid technologies” and the “smart grid drivers,” respectively, in the assessment framework. The latter two categories are more granular than their respective former categories; in other words, a main project application and a policy goal could encompass, respectively, a group of smart grid technologies and drivers. Project information presented in the two-part report was drawn from data call responses by the national experts and representatives of the ISGAN Participants, without any changes. This report presents 98 smart grid projects from 17 ISGAN Participants in the inventory, dated 28 March 2013. As the inventory is being continuously updated, the content of this report will necessarily change to reflect the current status of the inventory.

Smart grid projects are responsible of wide range impacts, which span from the electrical power system to the entire society. In general, the investment projects are assessed with a Cost-Benefit Analysis (CBA), which requires quantifying the impacts for converting them in monetary terms. In the smart grid context, not all impacts are quantifiable and/or monetizable; therefore, the CBA lacks in describing completely the smart grid potential. With the aim to outclass the CBA shortcomings, this discussion paper proposes to integrate the CBA into a Multi-Criteria Analysis (MCA) framework. The combined approach preserves the strengths of both CBA and MCA and identifies the best alternative according to its monetary and non-monetary performances. Furthermore, the stakeholders’ point of view is directly collected and the preferences are explicitly related to the decision-making problem under analysis. To achieve a common smart grid assessment framework, the MC-CBA methodology relies on acknowledged guidelines on project analysis. The assessment approach described in this report decomposes the decision-problem by analysing the impacts in three main areas: the economic area, the smart grid development merit area, and the externalities area. The MC-CBA methodology helps the decision maker identify the best smart grid investment option; the final aim is to provide a reliable support tool for orienting effectively the investments and the regulatory policies on smart grids.

While in many cases the negative effects of uncoordinated DER have caused local and system-level challenges, with proper design and control, DER can effectively support the electric grid. DER with advanced control features have been shown to increase hosting capacity by providing voltage support in distribution circuits, supplying ancillary services such as voltage or frequency regulation.

New energy storage targets in Europe and California, energy storage regulations, along with new storage technologies are providing the foundation for massive deployment of energy storage resources. Large-scale storage is common for renewable energy smoothing, peak-shifting, and voltage support, while commercial and residential-scale systems are financially viable in many jurisdictions due to grid codes and other regulations. For instance, electricity prices in Germany are high enough that storing solar energy for use during peak price periods has made home ESS cost effective.

Further, the combination of solar photovoltaics (PV) and energy storage can generate additional value when interoperable grid-support (“advanced grid”) functions allow for intelligent control. In a position paper issued by the European Photovoltaic Industry Association (EPIA), decentralized storage and the ability for those devices to respond to commanded signals will “help support distribution grids operation – and even sometimes avoid costly grid reinforcements.” Widespread adoption of these functions could allow energy storage to remove some of the barriers to high-penetration PV and wind power.

Advanced DER grid functions are not the same across all countries and jurisdictions; and many regions do not have a defined certification procedure to validate the functionality of these devices. As a result, DER system vendors create different versions of their product’s software to be compliant with regional requirements. This adds cost and complexity to the design and certification processes. It also generates disparate testing methods and there is no common set of parameters that can be communicated to the DERs. If a single procedure was created that accounted for all the jurisdictional variations (e.g., a superset of the grid code discrepancies), a single document and procedure could be used to validate all grid code requirements. This is challenging because there are a large number of grid codes and technical rules—each with variations in the function definitions.

The development of an inclusive set of tests for grid support functionality has the potential to open markets for energy storage providers. Data collection redundancies are removed as well, thereby further reducing the overall cost of certification and deployment. Hence, harmonization and standardization of these advanced function tests would bolster the international market for energy storage systems and enable higher penetrations of renewable energy sources.

To accomplish this goal, the proposed “SIRFN BESS” protocol is inclusive of many technical rules and grid codes while being detailed enough for uniform results across laboratories, countries and, even, continents.

New technologies are challenging conventional regulatory regimes and new policies and consumer demands are similarly challenging the currently available technologies. For example, as the demand for cleaner energy sources gains ground all over the globe, technological improvements are necessary to integrate large amounts of variable energy sources such as solar and wind into various electricity systems, while ensuring acceptable levels of reliability and security of the system. Similarly, as consumers engage more with electricity systems, demand profiles and consumer choice, among other demand-side elements, are also challenging our system, providing opportunities for demand-side management and related technologies. In this rapidly changing landscape, regulators and policy-makers must consider how consumer participation and new technologies interact with the market place.

This discussion paper from ISGAN Annex 6 Power Transmission & Distribution Systems Tasks 1 and 2 focuses on achieving flexible power delivery by examining the policies and regulations, as well as expansion, planning, and market analysis for the United States and Europe. This review looks at how policies and regulations have changed to accommodate new developments in the operation, planning, and market areas of each grid system. Additionally, it highlights certain efforts undertaken to better understand and implement the policy and regulatory changes in these processes as both the United States and Europe work towards achieving a modernized grid system, specifically including the increased deployment and use of smart grid technologies, e.g., synchrophasor measurement technologies, net metering, distributed generation, energy storage, advanced metering infrastructure.

About ISGAN Discussion Papers: ISGAN discussion papers are meant as input documents to the global discussion about smart grids. Each is a statement by the author(s) regarding a topic of international interest. They reflect works in progress in the development of smart grids in the different regions of the world. Their aim is not to communicate a final outcome or to advise decision-makers, rather to lay the ground work for further research and analysis.

This is a key risk area that must be addressed for successful implementation. In this context, it is worth briefly reviewing conventional methods of cost-benefit analysis and mechanisms for cost recovery with a greater focus on the consumer side of the equation, as the underlying values and processes will inform new cost allocation methods for smart grid investments.

ISGAN brings the experience and perspective of the global Smart Grids community together in this paper in order to increase understanding of the costs and benefits of smart grids from a consumer perspective, so that they may be communicated more widely and more effectively.

This paper, authored by Annex 4: Synthesis Insights for Decision Makers, attempts to address these issues across a range of likely possible smart grid configurations and market structures, while acknowledging that many other technology configurations are possible. In light of the continuing evolution of the smart grid, cost allocation will be an ongoing subject of ISGAN research and analysis, and this white paper aims to provide a framework for this ongoing analysis.

The need for new balancing resources and for a “seamless grid” capable of integrating both large-scale and small distributed energy resources (DER) are among the driving forces of smart grid development. Smarter grids are an important enabling tool for achieving higher penetrations of VRR on transmission and distribution networks. Depending upon the relative share and geographic distribution of large-scale and DER resources, various technologies, regulations, and policies are required to support high levels of VRR generation. In this context, policy makers will benefit from an understanding of how smart grid technologies contribute to VRR integration, and all stakeholders will benefit from increased alignment between smart grid development roadmaps and national and regional visions for renewable energy development.

The objective of this report, authored by Annex 4: Synthesis Insights for Decision Makers, is to give insights for decision makers on the various contributions of smart grid systems in achieving VRR integration. A variety oftools and solutions exist for achieving high penetrations of VRR generation, and the smart grid solutions outlined in this report are considered alongside a range of integration best practices.

Significant policy gaps exist in the field of grid cyber security, and ISGAN is well-positioned to convene stakeholders and foster discussion to advance best practices that support innovation while protecting critical infrastructure and consumer data privacy. This report, authored by Annex 4: Synthesis Insights for Decision Makers, identifies key issues in cyber security policy design, and suggests potential collaborations for the ISGAN membership.