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STRIKING A BALANCE IN THE MIDST OF CHANGE May 13-16, 2012 Québec City, Québec (Canada). RETHINKING THE ELECTRICITY GRID 14 May 2012. Presented by: PATRICIA DE SUZZONI ADVISOR TO THE CHAIR OF CRE (French Energy Regulator). TODAY’S AGENDA ON SMART GRIDS.
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STRIKING A BALANCE IN THE MIDST OF CHANGE May 13-16, 2012 Québec City, Québec (Canada) RETHINKING THE ELECTRICITY GRID14 May 2012 Presented by: PATRICIA DE SUZZONI ADVISOR TO THE CHAIR OF CRE (French Energy Regulator)
TODAY’S AGENDA ON SMART GRIDS • ICER report on the regulatoryapproaches to the implementation of smart meters • The French case: from smart meters to smart grids • Objectives and regulation in the European Union
TODAY’S AGENDA ON SMART GRIDS • ICER report on the regulatoryapproaches to the implementation of smart meters • The French case: from smart meters to smart grids • Objectives and regulation in the European Union
ICER REPORT ON SMART METERING • ICER: a voluntaryframework for cooperation • Implementation of smart metersso far has been a complextask, adviceneeded • A portfolio of case studiesbased on jurisdictionswith direct experience
6 MATURE MARKETS STUDIED • Electricity and gas (large-size markets): • France (35M electricity, 11M gascustomers) • Italy • UK • Electricity (medium-size markets): • Canada-Ontario (4,8M customers) • Sweden (5,2M) • USA- Colorado (3M)
MAIN FINDING 1: LEADERSHIP IS NEEDED • A cleardecision on which organisation isleading on smart meteringpolicyisneededat an early stage • Government, NRA, commercial body • If commercial body, soundlegal and regulatoryframeworkisneeded
MAIN FINDING 2: MARKET DESIGN MUST BE CLEAR • Clearroles & responsibilities for market participants • Ownership of meters • Minimum functionalities of systems • Standards to ensureinteroperability • How and whencosts of implementationcanberecovered • …
MAIN FINDING 3: SMART METERING PROJECTS SHOULD BE WELL PREPARED • Usefulness of pilot exercisesbefore full implementation • Implementationmaytakeyears to becompleted • An impact assessment to developsoundpolicyproposals • The proposed smart meter model shouldaccommodatefuture developments in technology and market
MAIN FINDING 4: CUSTOMERS HAVE TO BE EMPOWERED • Engagement of • consumers in the • policy-making • process • Specificcustomer protection measures, e.g. data privacy & cyber security • Customers’ need of simplicitywith more complextariff structure
TODAY’S AGENDA ON SMART GRIDS • ICER report on the regulatoryapproaches to the implementation of smart meters • The French case : • from smart meters to • smart grids • Objectives and regulation in the European Union
THE FRENCH CASE: A PROACTIVE REGULATOR • CRE created as an independentAuthority in 2000 • Engaged in smart gridssince the beginning • A 2-step approach:
SMART METERING AS A FIRST STEP TO SMART DISTRIBUTION GRIDS • Dialogue withstakeholders • Consumer bodies, retailers, DSOs, TSO, Administration, equipmentmanufacturers, system integrators • Control of Linky Pilot and cost-benefitanalysis • 300 000 smart meters 2010/2011 • Regulation of roll out • July 2011: roll out mandatory for 35 million customers • January 2012: minimum functionalities
THE THINK TANK APPROACH • In 2010, CRE organised a conference and as a follow up released« The electricity of the future: a worldwide challenge » • Permanent forum / quarterly workshops • www.smartgrids-cre.fr
TODAY’S AGENDA ON SMART GRIDS • ICER report on the regulatoryapproaches to the implementation of smart meters • The French case: from smart meters to smart grids • Objectives and regulation inthe European Union
A TOOL TO MEET AMBITIOUS OBJECTIVES • EU energypolicy’s 4 key objectives: • Smart grids are a mandatorytool to meetthese objectives
HOW TO FINANCE • Major investment but estimatesvary • 450€/customerwould lead to 115 B€ investment for EU distribution gridsbetween 2013 and 2023 • Business models / scope of regulation / gridtariffs
SMART GRIDS: FROM INNOVATION TO DEPLOYMENT • 2011 EC communication • No regulation of smart grid infrastructure so far • 2009: 80% target by 2020 for electricity smart meters • 2012 EC recommendations to Member States on minimum functionalities and cost-benefitanalyses • Standardisation in progress • Role of interconnection and marketmechanisms
Thankyou for your attention • www.smartgrids-cre.fr The ICER Report on Smart Metering is available at www.icer-regulators.net
THE EU 2020 AGENDA THE LEGAL FRAMEWORK • The Climate-Energy Package (2008) • Increasingrenewableenergysupply to 20% of total demand • Reducingconsumption by 20% with respect to 1990 levels • Reducinggreenhousegasemissions by 20% with respect to 1990 levels • The 3rd Energy Package (2009) • 80% equippedwith smart meters for electricity, cost-benefitanalysisconducted by Member States by Sept 2012 • The EnergyEfficiency Directive revisionunder discussion (2012)
Inve stments /category Total 3848.7 M€ Projects/category Total 277 implementation sites Project investments (M€ ) 75 Investments (M€) / No. of project implementation sites per country Other Storage Transmission automation Home application Distribution automation Integrated systems Smart meters OVERVIEW OF SMART GRID INVESTMENT AND IMPLEMENTATION ACROSS THE EU Source: JRC, IE Projects represented can span over more than one country and can include more than one category. Three projects are not represented in this picture: Kriegers Flak project, a supergrid between Germany and Denmark total investment of 507 M€; smart meter roll-out and AMI in UK, estimated investment of 11897M€; and smart meter roll-out in Sweden, spanning approximately 150 projects and amounting to a total investment of approximately 1500 M€.
APRIL 2011 EC COMMUNICATION SMART GRIDS FROM INNOVATION TO DEPLOYMENT • DevelopingcommonEuropean standards • Adressing data privacy and security issues • Allowingregulatoryincentives for deployment • Ensuringcompetitive services to customers • Supporting innovation and rapid application
CEER POSITION PAPER ON SMART GRIDS • Public consultation led to a consensus on 3 main priorities for regulation: • To focus on the outputs of network companies • To encourage cooperationamongstakeholders to address the barrriers • To encourage innovation whileprotectingcustomers