As far as adopting new technology is concerned, the utility industry does not have a pioneering reputation. This may be partly due to the fact that the industry is critical to the national economy and downtime, whether due to process changes or natural disasters, have the potential to adversely affect productivity figures. Still, the utility industry’s embrace of technology has accelerated in recent times as concepts like battery storage, electric vehicles, and blockchain increasingly pervade conversations within the industry. The advent of smart cities means more changes in the near future. Here is a brief rundown on how two such conversations - Blockchain and Electric Vehicles - fared in 2019. Â
Blockchain
The hype around blockchain subsided considerably this year. The technology is no longer considered the fairy dust sprinkling that will solve the world’s problems. Within the energy sector, the focus has now shifted to actual and, more importantly, practical use cases of the technology that are applicable to the grid. In the main, blockchain’s distributed database can be used at the grid’s edge for DER systems. However, the novelty of blockchain is such that it might be several years before we are able to see results. The lingering questions pertaining to blockchain’s use in energy trading systems still remain.  Â
Transactive energy systems, which enable peer-to-peer trading of energy, can benefit from the decentralized structure of a blockchain and are considered blockchain’s main use case. The list of companies using blockchain has multiplied. An example of this is Power Ledger, which is busy inking agreements for use of its technology in diverse projects, from virtual power plants (VPP) to peer-to-peer trading of solar energy for projects in India. Not much is known about the results, or for that matter, progress of its project implementation.      Â
But there have been setbacks as well, as in the case of LO3 Energy, which developed an app for Brooklyn Microgrid. At the Greentech Blockchain conference this year, Lawrence Orsini, founder of LO3, said they had “handed off” the project to the community after developing the Pando app, which is used to trade energy between stakeholders.Â
But further progress seems to have been stalled by existing state regulation that prohibits the sale of energy by anyone other than regulated utilities or approved retail service providers. Brooklyn Microgrid started a Change.org petition four months ago to petition for a change in existing regulation but it has, so far, garnered only 509 signatures, approximately half of its target. What’s more, the company has shifted its coverage area to further down in Brooklyn, towards Bay Ridge, away from its immediate surroundings of Gowanus and Park Slope.Â
One area which seems to have been ignored in the blockchain gold rush is the development of an appropriate policy and legal framework for use of blockchain systems in the energy grid. As I mentioned earlier, progress of the Brooklyn Microgrid project is stuck due to existing regulations. Such projects are also not decentralized; for the most part, they are supported by utilities, which supplement power to sellers when there surplus is not available. Then, there’s the fact that clarity about the terms of trading between power producers is also not yet available.
Electric Vehicles
Electric vehicles came into their own this year. Tesla, the torchbearer of the EV revolution, swung to a profit, as EV sales picked up speed during the first half of this year. A sign of the market’s maturing is major automakers experimenting with different styles and makes of electric vehicles.Â
The EVs will need charging stations to power the zero carbon economy. This is where utilities come in. Members of the Edison Electric Institute, a consortium of utilities, have committed more than $1 billion in electric vehicle infrastructure and outreach. Major utilities are in the fray and have promised to spend tens of millions of dollars for the effort. Speaking at the SEPA Grid Evolution Summit in June this year, Dominion Energy chief innovation officer Mark Webb said utilities could build out major infrastructure on U.S. highways provided they were given the right incentives. Those incentives are being offered in states like California, which is waging a war against President Trump’s emissions standards. Stricter emission standards could potentially result in bigger sales numbers for electric vehicles.Â
Meanwhile. California has also asked utilities to develop plans to manage and monetize the increase in load due to electric vehicles. The state’s energy commission produced a report in April this year detailing the results of tests to determine the optimal framework for load management in a grid with EVs. This is where the rubber hits the road and experimentation, whether in use of time-of-use rates or upselling additional services at charging stations, will show the way forward for the future. “The imperative is to shift EV charging away from peak electricity demand periods to avoid adding costly new capacity. Utilities are using or planning to use communications and control technologies combined with real-time pricing to incentivize charging during off-peak demand hours and/or periods of peak solar and wind output,” is how a Deloitte report frames the question for utilities.