Power Hub – The Virtual Power Plant Open Smart City 2012 Copenhagen March 20th 2012

Sales & Distribution Energy

Markets

Exploration & Production

Power

PRODUCTION OPTIMIZATION SALES AND DISTRIBUTION

GAS

OIL

RENEWABLES

COAL

BIOMASS

B2C

B2P

B2B

WHOLESALE

ENERGY

EXCHANGES

Introduction DONG Energy: An integrated energy company

Power Hub

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Introduction The VPP project (Power Hub) is part of Twenties under FP7

Experience from

implementation

and impact

Demonstration of

VPP capabilities

Creating new

business

opportunities

Transmission system operation With large penetration of

wind and other renewable Electricity sources in Networks by

means of innovative Tools and Integrated Energy Solutions

50% funding 50% funding

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Point of departure The challenge of wind and other renewable energy sources (RES)

CHP's are pushed out of the market

Oct. 1st – 5th 2009, DK1

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DK2

DK1

Oct. 1st – 5th 2009

Zero

prices

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Point of departure The VPP - Power Hub – The intelligence in an integrated energy system

Energy markets Buyers of

flexibility

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How the VPP – Power Hub - works Examples of assets in the Power Hub portfolio

Gasturbine at Novo Nordisk

Asset

5 MW gasturbine

Primary purpose

Process steam

Secondary use:

Generation and ancillary services

Diesel genset at Skærbækværket

Asset

2 MW diesel generator

Primary purpose

System backup

Secondary use in Power Hub:

Generation and ancillary services

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How the VPP – Power Hub - works Delivering primary regulation through remote control of hydro power plant

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Harteværket (hydro power plant)

was one of the first 3rd party

participants in the Power Hub

project.

When Vester Nebel Å was put back

in its old riverbed in 2008 the plant

lost approx. 80% of its water and

was threathened by closure.

By delivering ancillary services

Harteværket has been able to

compensate financially the effect of

the large reduction in water flow

Delivering ancillary services would

have been very difficult for the plant

without Power Hub.

Carl Hilger (Chairman of the board)

16-11-2011

How the VPP – Power Hub - works Optimising load schedules for the Better Place EV fleet

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Battery switch stations EV fleet

Control

center

2012+

ELSPOT

ELBAS

Energinet.dk (ancillary services)

Optimization across

energy markets

End 2011

Optimization across

energy and

reserves markets

How the VPP – Power Hub - works Island Operation Demonstration in the Faroe Islands

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Background

Electrical isolated

Often blackouts

Expects more windpower

Faroe island LUs:

2 heatpumps (salmon farming)

1 coldstore

2 heatpumps (freezing)

Faroe island grid controlled:

2 radials in the Faroe power grid

Purpose

Increase system stability using VPP

intelligence

RES Production Consumption 'Conventional', embedded

production

Non-

controllable RES (WTG, PV) Normal Consumption Unit -

Controllable RES (WTG, PV)

- curtailed by Power Hub

HVAC / pumps

- controlled by Power Hub

Emergency Gensets

- controlled by Power Hub

How the VPP – Power Hub - works Micro Grid demonstration at DONG Energy headquarters

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2 x 800 kW Gensets

DONG Energy GTF

89 kW PV

DONG Energy GTF

(scale by 5:1 to 445 kW)

3 x 350 kW Cooling compr.

DONG Energy GTF

DONG Energy GTF

3 x 1.2 kW Wind Turbines

DONG Energy GTF

(scale by 100:1 to 360 kW)

Complexity rules in the real world Building the operational platform and business proces integration is not trivial

Varying DER regulation capabilities and control technology impacts mobilisation

DER owners awareness of capabilities and potential Flexibility, ancillary services and reserves markets are not commonly known topics

Linking flexibility to business processes rather than technology is paramount

Standardisation and Smart Grid enabling Necessary modifications to DER control technology often ruins the business case

Of the shelf Smart Grid enabled/compliant units could accellerate smart grid roll out

Market reforms and regulatory changes Restructuring markets in terms of bid size, duration and gate closure

TSO approval of a VPP as a single unit instead of approval of every unit in portfolio

Learning Points Mobilising distributed energy ressources (DER)

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Vision of a Smart City Integration and orchestration of all energy resources and infrastructures

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The cont. development of renewable energy (RES) will have a strong impact: Displacing conventional generation – with no incentives to invest in new

In current regimes and markets – RES are not participating in balancing

New solutions are required to compensate for the effects of RES: Mobilisation of distributed generation – when RES cannot cover demand

Mobilisation of demand side flexibility – when there is an excess generation

Both sides must provide balancing services at TSO and DSO level

One key to succes is creating incentives for local assets to participate: Controlling local units technically is (next to) trivial

Creating value under the current regimes is challenging

DONG Energys VPP – Power Hub – is doing both! Pooling capabilities of local assets to help compensating for the effects of RES

Clustering, e.g. landbased wind, on market conditions as part of the portfolio

Creating value for owners through integration to energy markets and reserves markets

Power Hub – The Virtual Power Plant Summary

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Questions/Answers

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