19: Gridlocked: networks, DSOs and net zero

How is the energy network changing, and what does it mean for net zero? How can we manage our networks to accommodate smart, local innovations in energy generation, and what opportunities does this present for the future? Guests this week: Professor Keith Bell, Scottish Power Chair in Smart Grids at the University of Strathclyde and Dr Jeff Hardy, Senior Research Fellow in the Grantham Institute at Imperial College London.

Episode Transcript:

Matt: Hello, I’m Dr Matt Hannon.

Rebecca: Hi, I’m Dr Rebecca Ford and welcome to Local Zero.

[Music flourish]

Matt: So this episode is all about our electricity networks. How we manage our networks is critical to keeping the lights on, pushing bills down and bringing low-carbon power generation onto the grid to tackle climate change.

Rebecca: Absolutely and today, we’re going to be exploring why our networks are not currently fit for purpose and how they’ll need to change as we move towards that net zero future.

Matt: Today, we’re joined by some very exciting guests. First, we have Professor Keith Bell, Scottish Power Chair in Smart Grids at the University of Strathcylde and a member of the UK’s Climate Change Committee.

Keith: If we’re going to have lots of us using heat pumps as well as electric vehicles, inevitably, there’s got to be investment in enhancing the capacity of the networks and we’ve got to target it in the right way.

Rebecca: We’re also joined by Dr Jeff Hardy. He’s a Senior Research Fellow at the Grantham Institute at Imperial College London. Before this, he was Head of Sustainable Energy Futures at the GB Energy Regulator, Ofgem, so he brings a wealth of expertise to today’s conversation.

Jeff: Over time, we’ve actually been reducing the amount of electricity needed because of energy efficiency behaviours over the last couple of decades and so there’s actually less electricity in total going through the grids.

[Music flourish]

Matt: We have a dedicated Twitter handle and if you haven’t already, go and find us and also follow us @LocalZeroPod to get involved in the discussions there. Also, email us at LocalZeroPod@gmail.com if you need more than 280 characters to share your thoughts.

[Music flourish]

Rebecca: And, of course, it wouldn’t be Local Zero without Fraser, so welcome, Fraser.

Fraser: How is everybody doing?

Matt: Very well, thank you. Summer is here. The t-shirt is on and even the shorts. It’s feeling very summery. How about you guys?

Rebecca: I can’t believe the weather we’ve had over the last few weeks. It’s just been sweltering. Obviously, this is Glasgow’s two weeks of summer [laughter].

Matt: Yeah, and talking to our producer, Carys, she’s saying she’s in Spain at the moment where it’s 410C heat with air-conditioning blazing. I guess many of us will be thinking, ‘Oh, I wish I was on holiday,’ but actually, there are some pretty frightening signs down there now.

Rebecca: Yeah, I don’t know if I could cope with that. Just the temperatures! Just look at what’s been happening in Canada and North America. It’s insane.

Matt: Scandinavia. Temperature records are toppling all over the world. So yeah, it’s never more pressing to cover the issues of climate change than it is now and hence, why we’re talking about it. So what’s on the menu today?

Rebecca: Actually, talking about air conditioners is a really great way into this because today, we’re talking about our networks and we’re talking about why they’re not fit for purpose. Actually, for me, this all comes down to some of the changes that we’re seeing in our homes, in our towns and in our communities and we’re starting to see more and more technologies like air conditioners, heat pumps, electric vehicles, solar on our roofs and maybe batteries in our garages. All of these changes that we’re seeing at that local level are starting to have an impact on our networks, so it’s a critical, critical issue.

Matt: They certainly are. I mean the network that we’re running today, the grid or whatever you want to call it, is something that was designed for a type of use and type of management which is completely redundant now today or becoming so. It’s almost designed for big, centralised generators, typically fossil fuel and non-intermittent generators providing power to centres of demand. The problem is now that we’re seeing many more householders’ decentralised generators, (for example, solar on roofs) starting to play a role in this grid, so they’re feeding into the grid at this low-voltage network. The other consuming issue which is adding complexity is that people are being encouraged to change their demand through things like time-of-use tariffs and we’ve also got the technologies, as you’ve mentioned there, like storage and EVs. The network is becoming far, far more complex to manage but there are opportunities. So that’s what we’re kind of wanting to explore today and if we don’t make the changes, Becky and Fraser, we’re in trouble – big trouble.

Fraser: So obviously, working in this space, I can appreciate the need for change and the issues that we face but networks and all of the policies, the regulation and the technical elements that go along with it can be quite a labyrinth to get your head around. In fact, Becky, we worked on a report a few months ago where I was tasked with unpacking a lot of the changes happening at Ofgem and these kinds of things just now and I will put my hand up and admit that I wrote this report, submitted it to the project partners and I don’t necessarily feel any the wiser on a lot of these issues because it’s complex and there are acronyms. So for someone like me, who doesn’t have a clear grasp on the networks, why is this important to net zero and what sort of changes do you think we need to start to see?

Rebecca: I’ll start on that and then maybe Matt will come in. I have a more technical background and I think, from a technical perspective... and you did raise the point that the regulatory side of things is really confusing and maybe I’ll let Matt come on to that with some of our guests but just from a technical perspective, our networks need to be balanced all the time. The amount of energy we’re generating and pushing into the networks needs to be the same as the amount of energy we’re drawing out of the networks. I mean you could think of it like your garden hose, right? So what goes in must come out and you can’t push more in than you’re pulling out or pull more out than you’re pushing in. It’s the same whether you’re talking about water, networks, or whatever. That balancing becomes harder and harder as you start to see more and more people trying to push stuff in, like Matt was saying, when you start to get new generation technologies. You’ve been recently talking us through the solar that you’re putting on the roofs in schools. Well, some of that energy that you’re going to be generating in Glasgow is going to be pushed into the grid and that means that the people that are operating the grid, our network operators, need to understand what all the energy is that’s coming in, understand where it’s going to and keep it balanced on a microsecond by microsecond scale and that’s just challenging.

Matt: That’s a really good explanation, Becky. In another way, you can think of it as the more action there is at the low-voltage level, that means the pipes and the wires that are connecting your home to the grid and the ones that you will be familiar with that keep your lights on... the more action there is there in terms of people feeding in or changing the time that they’re drawing down energy and maybe shifting it from day to night time... the more that these network operators need to have a handle on what’s happening in your house, your neighbour’s house and the whole street, they need to be able to monitor and understand what’s happening there because the national grid and the energy system operators that have the bird’s-eye view over the whole grid are responsible for keeping the lights on and for avoiding major blackouts. They’re relying much more on what’s happening at that low-voltage level. So if there is little coordination and management at the low-voltage level, those lights might just go out.

Fraser: Yeah, it’s one of those things that’s a prime example of the importance of the local, right? It would be very, very easy to think, ‘Okay, I’m just going to fling a solar panel up on my roof or invest in an electric vehicle and that’s that.’ But actually, those household-level and local-level interactions have huge implications across national energy provision.

[Music flourish]

Rebecca: I think we’d better bring our guests on, eh?

Matt: Yeah, bring them in.

[Music flourish]

Jeff: I’m Dr Jeff Hardy. I’m a Senior Research Fellow at the Grantham Institute at Imperial College London. I research smart local energy systems as part of the Energy Revolution Research Consortium. Two other quick things: I also sit as Deputy Chair of the UK Power Networks’ Customer Engagement Group which will, no doubt, come up later and I sit on the board of a renewable energy developer, Public Power Solutions Ltd.

Keith: Hello, I’m Keith Bell. I hold the Scottish Power Chair in Smart Grids at the University of Strathclyde. I’m also Co-director of the UK Energy Research Centre which is a multi-university, multi-disciplinary research effort aiming to inform energy policy and the energy transition and I’m a member of the Climate Change Committee.

[Music flourish]

Rebecca: Welcome, Keith and welcome, Jeff. It’s great to have you both here. As you know, today, we’re talking about our energy networks and really trying to understand the evolution of where they came from, what we’re doing today and why they’re not fit for the future but I’m wondering if we can just take a step back because not everybody that listens to this show has a really strong electrical engineering background. In fact, the three of us still struggle between ourselves sometimes to get to grips with it all. So, Keith, I’m wondering if maybe you can just give us a very high-level overview of how the grid works today and why that’s a bit of a problem.

Keith: I think we should probably start with what is the system anyway? When we talk about a power system or an electricity system, what is it? What does it comprise? It’s got three main elements: generation and where you get this electrical energy from converting other energy from other forms into electricity; the transmission network to take that energy or that power across the country; and the distribution network that takes it into each building and premises where you’re using it. Back before 1990, the whole electricity sector in the UK was state-owned and all those three parts were part of state-owned companies. The local distribution companies bought power from the generators, from the big power stations typically or if you go far enough back, they were all little power stations and transported that energy via the national transmission network. We’re quite used to talking about the National Grid that then became one of the private companies when things got privatised. Each of us then bought our electrical energy from our local distribution company but then in 1990, the whole sector was liberalised, opened up to competition and sold off to private owners. Initially, in the generation and production of electricity, there was introduced a wholesale market for electrical energy with different power stations and their newly privatised owners competing with each other. However, the buyers in that market were still the various local distribution companies and it wasn’t until a few years later – I think about the year 2000, wasn’t it, Jeff? – that retail competition was introduced so that everyone had the right to choose who to buy their electricity from and there was a similar thing for gas. Now, in practice, that meant the establishment of what we now term suppliers or retailers who are, in effect, agents who act on behalf of us in the wholesale market. Now they don’t physically produce, transmit or distribute anything. They pay fees to the transmission and distribution network owners which are also now privately owned for the right to use their networks to get the power they’ve bought from the generators through to their own customers. So all of us pay our bills to one of these suppliers and they, in turn, pay bills to the network companies but there’s one other really important player in this which is the regular, Ofgem, who you used to work for, Jeff.

Jeff: Ofgem is the Office for Gas and Electricity Markets and it is the energy regulator. It’s doing a couple of things. One is because these electricity networks and gas networks are natural monopolies, you can’t choose who you’re connected to. These are regional-based network companies and so they are regulated as monopolies and I’m sure we’ll get into the joys of price controls a little bit later in this podcast but then also, Ofgem looks after competitive parts of the market as well. It does retail wholesale regulation, so how electricity is bought and sold and these electricity suppliers that Keith was talking about who we, as customers, have the relationship with. They’re the ones that bill us and they’re the ones that then pass those costs back to either bits of the system like these electricity networks and so forth. So Ofgem has got a really important role in making sure that competitive entities are competing fairly and treating their customers fairly and also making sure that these networks are doing the right things, including for net zero or their customers and for all parties that are using them but also that they’re doing it cost-effectively; so they’re not overcharging and they’re not acting, perhaps, like natural monopolies would do if they weren’t regulated.

Keith: Becky, you mentioned what’s funny about an electricity system and what does it take to make it work? That’s predominantly the responsibility of these network companies, although how those responsibilities mesh together is another issue which we will definitely come on to but why does it matter? Why does there have to be somebody that pays attention? The economists, I’m sure, would ideally just leave the wholesale market and the retail market just to get on with it by themselves. The problem is that an electricity system is actually pretty unforgiving in that it has minimal inherent energy storage capacity. It’s not got much margin for error, if you like, if there’s a bit of a timing error between the production and the consumption. If you think about other commodities like loaves of bread or pints of milk, if you’ve got a fridge, you can get a bit of storage so you don’t have to get the milk from the cow just at the moment as you’re there with your coffee cup ready to receive it.

Rebecca: Clearly, you’ve not been to my house, Keith.

Keith: No, I haven’t actually [laughter]. Okay, that’s an interesting experience if you’ve got the cattle on the lawn. I’m sure it’s well fertilised [laughter]. It is more like that cow-to-cup kind of arrangement in the electricity system, so we have to balance, second by second, the production of electrical energy or the rate of production with the rate of use. So we talk about the term ‘power’ which is the rate of production or use of energy and then energy is the quantity we use when we talk about over a period of time. We have to balance that and we can see that through the system frequency. We have an alternating current-based system, so it alternates at about 50 Hz or 50 times a second. It does fluctuate. We can see whether it’s out of balance because the frequency might be falling which means there’s not enough generation to meet demand at that moment or it might be rising in which case, there’s too much. Fortunately, we’ve got automatic controls on the generators which monitor the frequency and then will adjust their output accordingly but every now and again, there will be some big disturbance that gives the frequency a big kick. There’s a big imbalance and then we’ve got to respond to that and deal with it in some way. The other thing we’ve got to do is keep the voltages within limits for safety reasons predominantly but also to make sure that our appliances will work properly and then to make sure that the wires carrying the power from the generators all the way through to our appliances don’t get overloaded and they don’t get too hot. Whenever a current is flowing, you get heating and if they get too hot, you’ve got a risk. The main risk is of a short circuit current happening or a flashover which as well as being very dangerous, depending on where it happens and how long it happens for, risks the stability of the whole system actually but again, fortunately, we’ve got protection devices on the network to spot if and where there’s a short circuit and isolate that quickly and safely and let the rest of the system carry on.

Rebecca: So this is a very complex landscape. I mean just the sheer number of different organisations involved in terms of the retailers, suppliers, generators, transmission grid operators and distribution operators and ultimately, all working together within this cohesive set of regulations to make sure that our lights stay on. How and why are things changing? Why is this even an issue that we need to be discussing now? The grids worked fine for hundreds of years or decades and decades, so what’s happening now that means that this has to change?

Keith: In a word, decarbonisation. We’ve got to get our energy from different sources. In the UK, we’ve used fossil fuels as our source of electrical energy and burning fuels to make heat, to make steam under high pressure to turn turbines, etcetera. We’re not in a fortunate position, like people are in Norway, for example, where they’ve got fantastic geography for storing water, building dams and having tunnels to let water flow through and turn turbines but we do have lots of high wind. We can build wind turbines to harvest the energy and make electricity but the technology and the electrical equipment that’s used to do that is very different from the kinds of electrical machines that we’ve had before. We don’t have that storage capability that you have with a pile of coal or a pipe full of gas under high pressure, so there’s that kind of balancing challenge that we’ve got to address. It’s made difficult by the fact that it’s not windy all the time. We’ve got quite a lot of solar PV generation now as well and, again, of course, it’s not sunny all the time. So we’ve got the variability of the resource and the differences in the technology to have to deal with.

Matt: So, Jeff, looking at this maybe not from a purely decarbonisation perspective, are there other drivers at play? Are there other reasons why we’re needing to think about managing the grid in a different way?

Jeff: Well, I guess there are all sorts of things going on. We have implications of climate change itself which are slightly changing things in the grid. There are just a couple of small examples. Electrical equipment doesn’t like rapid temperature changes in particular and you can transmit less power through lines when it’s really hot. It’s just simple things like that. So if the temperature is going up or if the temperature is going up very quickly during the day, that causes some issues. Other things, like trees grow quicker during this and one of the major things that stop grids from working is trees falling on them and knocking infrastructure down. There’s lots of effort going into just thinking about how you adapt these networks to climate change but then there are lots of other things going on at the same time. So in addition to all of this interesting stuff that’s going on on the electricity generation side, you’ve also got a change of demand going on at the same time. No, there are two things going on actually. Over time, we’ve actually been reducing the amount of electricity needed because of energy efficiency behaviours over the last couple of decades, so there’s actually less electricity in total going through the grids. The other thing is that we’re expecting that demand to change quite a lot going forward in the future because this decarbonisation will also result in new demands, all of them local for the most part. So electric vehicles replacing fossil fuel vehicles, for example, so batteries on wheels moving around these distribution networks and then also potentially moving from gas to electric or other forms of heating that haven’t got any carbon. That means you’ve got new demands and new generation going on simultaneously and the network in the middle kind of sorting out all of the interesting new challenges.

Matt: Of course, never far from the headlines are customers’ bills. Obviously, in your role at Ofgem and you’re involved with UK Power Networks, are we having to look at managing the network in a different way to avoid bills growing or potentially even lowering them?

Jeff: Yeah, that’s right, Matt. One of things that’s happening at the moment is some massive optimisation and calculation that goes on which is how do you accommodate changes in generation, changes in demand, changes in pressures and things that are happening on these networks without the cost going up? If we take it that the future is going to be much more renewable and there’s going to be all of these new demands on it, what could happen and, in fact, what would be very likely to happen if there wasn’t an emphasis on doing the right thing on networks is network companies would probably build a grid up to about six times bigger than today. That’s what would happen and if you met all of that new demand and did it predominantly through renewables, you’d need to have a grid that was capable of moving around lots of power and meeting very high peak demand.

Matt: That’s a lot of copper.

Jeff: A lot of copper. What’s actually happening is we’re seeing much more emphasis on this so-called smart and flexible grid operation. What that means is the network operator running their grid in a much smarter and more flexible way which means trying to match demand and supply much better. In a very renewable system, instead of what Keith was saying earlier where you match with really flexible supply whatever demand there is, in the future, what you’re doing is trying to have demand meet what supply is available because the wind is blowing or the sun is shining and, therefore, electricity is being generated very cheaply or it is not. That’s really all a smart grid is doing whilst trying to move that power around in a very effective way without blockages in the networks and so forth. That’s really the essence of it. You’re trying to build an energy system as small as you can to meet that future demand. That’s all a smart grid is when we come down to it.

Keith: Yeah, I would agree. It’s about utilising the infrastructure in the most effective way and avoiding having to overbuild the infrastructure. The conventional historic way of building a distribution network was what would be described as ‘fit and forget.’ Just build enough of it so that anyone that’s connected to it can do what they like. You don’t have to pay too much attention once they’ve connected. At a whole electricity system scale, that balancing has always been done by flexing generation and when you’ve got piles of coal or pipes full of gas, that’s doable and that’s what we’ve been doing. If you’ve got a reservoir with water in it and you can open and close the taps, again, you can be flexible on the generation side. The Holy Grail for energy economists has been to unlock the flexibility on the demand side and that’s becoming more and more important. When you have wind and solar resources varying, can the demand for electricity flex to fit with when it’s windy and sunny? So that’s at the whole electricity national scale and then you can also look at that at the more local scale because you’ve got the limitations of your local network in getting the power in or out. So if we can get that balance right within the networks, which doesn’t necessarily have to mean perfectly balanced but within the import or export limits, then it promises a much more cost-effective use of the resources.

Rebecca: I think this is getting to the crux of the conversation today and how we start to create those changes in the way that we’re managing the networks on more and more localised scales. We’re starting to hear, at least in the fields that we work in, more about DSOs; so the shift from companies just owning and operating the networks to actually taking a much more active role as system operators. I’m wondering if you can just explain and break it down about what really is a DSO and how is that going to be different to what they’re doing already? What are some of the new things that they’re going to be doing?

Keith: The first thing to talk about is the way that a distribution network is operated. So before we get into the acronyms of what the hell is a distribution network operator, a DNO, and what’s a distribution system operator, a DSO, let’s think about what’s physically going on. I think the key change is away from that fit-and-forget thing to something that’s much more active. When it’s fit and forget, the network is a distribution network because, by the way, all of this flexibility stuff has always been done at a transmission scale but at that large scale, you can afford to spend money on monitoring, control and all that sort of thing. It’s a very different thing when you’ve got a huge number of individual system components and actors that you have at the distribution scale. Anyway, it’s moving away from this kind of passive operation and one of the things that the distribution network operator does is try and respond to faults that might happen. None of the equipment works perfectly all of the time and you have odd things that happen like JCBs digging into bits of cable and breaking them or whatever it happens to be. You rely on the protection then to isolate that fault very quickly and safely before the poor JCB digger driver is suffering in any way. They wait for faults and then repair them as quickly and as safely as possible and get people back on supply. It’s quite reactive and otherwise, it’s quite passive. But here, we’re connecting more and more generation to the distribution network and not just solar panels on people’s roofs but also wind turbines in fields or whatever it happens to be. Can we accommodate them in the power that they might be producing? Well, actually, maybe you don’t have to build the network for all possible combinations of conditions. Maybe it’s more cost-effective, for a few hours of the year, to limit the output from a generator just to stay within the network’s export limits. If you’re very generous, you might compensate the wind turbine’s owner for the privilege of doing that. That doesn’t actually happen very much so far but that’s something we might come back to. As we mentioned already, you also want to make use of flexibility on the demand side. We’re going to have lots of people charging electric vehicles. Do they have to do it the moment they get home in the evening, assuming they’ve been out to work? That’s going to lead to a big coincident peak with everyone using the networks to do lots of things at the same time. The networks, historically, have been designed on the assumption that people will be doing different things at different times and that there’s a certain amount of diversity but if we’re all doing things at the same time, you can’t do that. So the peak becomes very big and you have to size the network for the moment of the biggest demand. Can we control these things? Can we persuade people to move the timing of what they’re doing with electricity and do things a bit earlier or a bit later? If people use electric vehicles in the same way as people use combustion engine vehicles, they spend, on average, 95% of the time not going anywhere and if it’s an EV and it’s plugged in, that gives you a lot of flexibility on exactly when you charge it. So we could spread that out for different people through different times of the night, for example, and stay within the networks’ limits. That’s what we’re trying to get to which is some kind of set of arrangements that encourages people to do that in a way that doesn’t adversely impact on them and then what are the institutional arrangements or market arrangements by which we can make that happen?

Matt: Jeff, just in the context of what Keith has laid out and the roles of this DSO, this distribution system operator, is this going to have a fundamental change to the way in which we think and consume energy? What I’m trying to bring this down to is the customer, i.e. you and I who are residential customers, businesses on the high street, manufacturers or whoever they may be... are we going to see a fundamental change now in the way that they engage with their energy consumption if the DSO is put in place? I’m thinking local energy markets, flexibility services and a whole world of possibilities.

Jeff: Yeah, it’s a really good question, Matt, and the answer depends a little bit. So imagine that duck gliding across a pond. Some customers, like households or businesses, may ultimately see no difference at all but there’s a lot going on. What do I mean by that? If we go fast forward to that energy system of the future where you’ve got an awful lot of weather-dependent electricity and an awful lot of new assets connected to the system that demands electricity at different times like these electric vehicles or different heating systems, what we’re likely to see is very dynamic pricing for electricity; so a different price of electricity every half hour for consumers and customers. Now we know from lots of evidence that most electricity and gas customers are not terribly engaged with electricity and energy suppliers generally. Something like half the people in the country have never switched.

Rebecca: I don’t even know what I pay. I don’t know what I pay for my electricity [laughter].

Jeff: Yeah, we are going to have words about this, Becky [laughter]. We’ve had this chat before but anyway, we’ll come back to this. This is not over. That is not a very large segment of the British population who are likely to be watching smart meters or in-home display units every half an hour and saying, ‘Oh my goodness! The electricity price has doubled. I’d better do something different.’ So what I would expect is all of these price signals, like a network operator that we’re talking about saying, ‘My grid is constrained so it would be really good if we could either turn up some demand so we could soak up all of these extra renewables or turn some demand down.’ I think a lot of this is going to end up very automated. I have a deal with an energy supplier that basically fixes the price of my energy needs and in return for giving me a fixed price deal, they manage the risks that they’re bearing of these variable prices by automating some of the things in my home. So like Keith was saying about the electric vehicle, they might automate when it’s charged; not if it’s going to be charged because you will, as a customer, really want it to be charged but they will have some control over when it might charge overnight. The same with heating systems; you still want to be warm but you don’t really mind if it’s not on at a certain time of day as long as you’re still warm. So that kind of automation we might see coming in and that’s going to bake in some of these network price signals, some of the wholesale market price signals and all of that kind of thing but from a customer’s point of view, it’s going to probably have to be very simple for the majority of end users.

Matt: So just to clarify for our listeners, I don’t know whether you were saying this was hypothetical or not but you were saying you were surrendering some of your timing or the freedom around your demand to your supplier. Are you saying that’s happening today?

Jeff: Yes.

Matt: And you are generating a benefit. So in some respects, that’s already happening before we have this body or bodies called DSOs and so you’re already kind of doing it, right?

Jeff: Yeah, that’s right. I’m lucky enough to have solar panels on my roof and a battery in my cellar. I’m also lucky enough to have a cellar. I have ceded control over when that battery charges and discharges to my energy supplier because I’m on a half-hourly tariff, so I’m on one of these dynamic tariffs, and they optimise it so I maximise the price I’m paid for electricity that gets exported and minimise the price that I pay for electricity coming into my house.

Keith: By the way, I would just say that it doesn’t have to be a DSO that enables all of this. That’s happening already, what Jeff has just talked about, without there being such a thing called a DSO. Where this DSO idea has come from was partly to try to capture that idea of much more active distribution network operation just in general but we also have quite a few... I don’t think all necessarily but quite a few of the distribution network operators in this country are arguing that they should be the parties that enable a lot of that stuff given the interaction with the distribution networks. For one reason, I think they’ve got a bit of an argument which is that we’ve still got this hard constraint of the network’s capacity. It’s a finite network. What actually happens to the network as a whole is affected by everybody else. It seems to need somebody who can have a good coherent view on it. So is that the same party that would then enable local energy markets and enable trading such as Jeff was talking about?

Matt: Keith, just to tie that off, if we have a million Jeffs...

Rebecca: That’s a scary thought [laughter].

Keith: Doing Jeffy things [laughter].

Matt: ...doing Jeffy things at home, is that when we really need to bring the DSO in just to get a handle on this? Is that what we’re saying? Because if there’s just a handful of Jeffs doing Jeffy things, that isn’t a problem. It doesn’t rock the boat but is there a critical mass of Jeffs and of people doing this demand management and decentralised generation at home which means we need somebody to come and coordinate and manage things?

Keith: I mean we already have somebody coordinating and managing it in the sense that that is the case that already exists and you have to be very brave to abandon it at the whole electricity system level. There is an electricity system operator. Pretty much every country in the world has a similar sort of idea that somebody has got to keep an eye on the whole thing and how it hangs together. When we have this kind of active operation of distribution networks, it seems like we have to have the same care and attention and have the same level of coordination. Precisely how a DSO or somebody like that interacts with every individual user, I think that’s up for debate and there are different ways in which it could be organised. I think I would agree with you, Matt, that at some level, some degree of coordination is needed to have visibility of how what everybody is doing with the network is impacting on the network itself and then how the network itself limits what everybody might be doing with it.

Jeff: Can I just say for the record that a million Jeffs acting independently on the electricity system would be a disaster [laughter] judging by the amount of tinkering I did early doors?

Rebecca: Coming back to this vision of a thousand or a million Jeffs, I think it’s really important to remember... and you said this yourself, Jeff, you’re lucky enough to have solar PV on your roof and a basement to put your battery in. For every Jeff that is out there that can do that and engage in this way... and let’s put this into place, it’s not just about having the finances to do it. It’s also having the wherewithal, the understanding and the ability to engage in this way because it isn’t simple. Yeah, there are a whole lot of factors that need to come together to enable this but for every one of you, there are probably 5, 10, 20 or maybe 100 people who just simply can’t engage in that way. So do we also need to be worried about the kind of potential unintended consequences or negative outcomes on some people that just simply can’t engage in this way? Could they be penalised for the fact that you’re able to take advantage of this new system?

Jeff: I think that’s such an important question and it genuinely could work out in a multiple-tiered way. Just imagine a future where there are a million Jeffs.

Rebecca: I’m still getting my head around that concept by the way [laughter].

Jeff: I know, exactly. So am I. The future is not big enough for a million Jeffs.

Matt: We’ve got the episode title straightaway, haven’t we? [Laughter]

Jeff: Oh, that’s too much of an image now but those who are able to afford and also want to get engaged in the future could be the ones who benefit most. However, those who cannot or will not and don’t want to engage and don’t engage with energy at the moment could be, in principle, very disadvantaged. One simple example of that is the best tariffs on the market might only be available to me and my 999,999 other Jeffs. Everyone else who hasn’t got the kit or doesn’t have the desire to get engaged could be on a worse tariff, effectively subsidising me because I’m able to tap into all of this wonderful value that, let’s say, the distribution network operator will pay me and other people will pay me because I’ve got really flexible kit in my home and everyone else might not. I think the critical thing to say now is this has to be a fair transition where everyone can benefit and that might mean that some people who would not normally be able to get on this ladder are subsidised to have some of this really cool and exciting but very essential net zero equipment in their homes.

Matt: It feels, Jeff, that there may be this kind of collision between fuel poverty and digital poverty. If you can’t get the app for that or if you can’t access the latest smart gadget, smart refrigerator, or charger then you’re going to be held back. So this is a really important point and goes hand-in-hand with a just transition. I wanted to end with a question to you both on what this smarter and more intelligent management of the distribution network, this lower voltage network, might mean for local climate action. The pod is called Local Zero and the question mark is whether this could create or unlock new opportunities for households and for communities to do something they may not have otherwise done. There’s a lot of chat about the DSO being this kind of portal or gateway to a local energy market and with the absence of lots of subsidies... we’ve covered this in our previous episodes things like the Feed-In Tariff which has fallen away, a lot of communities or local authorities who were doing stuff... like we’ve mentioned Fraser’s work with Glasgow Community Energy and they’re scratching their heads about what they do next. Could this be the answer? Could they generate a revenue stream and do something for net zero and a just transition whilst they’re at it?

Keith: Well, I think that point about the local energy markets is a really, really important one. The question is how those markets can be facilitated. How can you enable somebody who chooses to buy spare solar energy from someone down the road and make sure that that trade can be physically delivered? This is where the network operator, or the DSO, or whoever it is comes into play. What is the network infrastructure that enables those trades and those interactions? We have the danger that the network, at the moment, could be acting as a barrier to it but if the network can act as an enabler, which is what the network always has been... that’s fundamentally what it is. It’s to enable the use of electrical energy and, of course, it needs the production of it in order that people can use it. Do we get the right signals to be able to use things that are available where they’re available given the network constraints but also signals, on the other hand, to where investment in enhancing the network would be best made? We’re going to have an increasing need. If we’re going to have lots of us using heat pumps as well as electric vehicles, inevitably, there’s got to be investment in enhancing the capacity of the networks. We’ve got to target it in the right way to avoid what Jeff talked about earlier of having this potentially massive overinvestment in capacity that’s only used a fraction of the time when it turns out, if we’re being a bit smarter about it, we don’t have to have all of that capacity.

Jeff: Yeah, I think that’s right. Let me give just a few tangible examples. A little bit like you, Matt, I’ve been reading a few of the initial business plans that the distribution network operators have been putting together to say how they’re going to run the network over the five years between 2023 and 2028 and there are a few things that are coming out in there that are quite specific to more local energy projects. I’ve seen some of the plans that some of the network companies are actually putting forward; specific community energy funds to support community energy because I think they’re realising that these local energy projects can not only really engage local communities and provide a lot of valuable benefits to those communities but they can also provide a lot of these services, that Keith is describing, back to the network themselves. So working hand-in-hand with those communities is actually a win/win. Other things that are going on that I’ve seen are some really interesting ideas about network companies spending money on making homes and businesses more energy efficient in certain places on the network because that, in itself, brings down peak demand which means it puts less stress on the network. It’s like a win for homes and businesses because you have lower energy bills but it’s also a win for the network company because they don’t need to do any of these reinforcements. It’s a very interesting project to have locational energy efficiency. The final point that I’m seeing coming through is that also network companies are custodians of infrastructure. They operate lots and lots of the infrastructure in places around the UK and this infrastructure itself can have environmental harms but also the land and the surrounding areas could be improved. You could improve biodiversity and you could improve, through your supply chains, embodied carbon in some of the assets that you’re procuring and you can work very strongly to maybe enshrine some of the principles of, say, the circular economy into these products and things that you’re buying. So there’s also potentially a really strong environmental plus role that the network companies could play which then bring back benefits locally in terms of biodiversity, natural capital and all that kind of thing. There are lots of things that could happen and the mood music is that some of them are going to happen in the next price control but there are some baby steps here I feel for some of the companies as well because it’s not a natural habitat to be thinking about some of these issues but kudos to Ofgem and the companies for doing something positive here.

Rebecca: Well, I mean I think we could probably chat for at least a good few hours more on this topic but I think we’re going to have to find a way to bring that to a close. I like the idea of doing that on a very positive message there. I just want to say thank you so much to both of you for some brilliant insights and I hope that you’re going to stick around for our favourite part of the show which is Future or Fiction? In fact, Jeff, I’m pretty sure you’ve been studying up for this.

Jeff: Other than sitting in a therapy session with Fraser and understanding what’s on his mind at the moment. I don’t think there was any way of studying for this, so I’m just mentally prepared [laughter].

Matt: That’s why Jeff is here. I mean Jeff thought he had to talk about this topic...

Fraser: To come and Future or Fiction?

Matt: Exactly [laughter], just the tax... his entry fee.

Fraser: I don’t want to listen to you guys prattle on anyway. This is what everyone’s really, really here for [laughter].

Matt: Now it is time for me to hand over for the most exciting part of the episode today and over to Fraser for Future or Fiction?

[Music flourish]

Fraser: Thanks very much, Matt. Yeah, so as ever, for the uninitiated, Future or Fiction? is a game that we play at the end of every episode with our esteemed guests and hosts whereby I present the panel with a brand new technological innovation and they have to decide whether it’s real, i.e. it’s the future, or if I’ve completely pulled it out of my backside, in which case it’s fiction.

[Music flourish]

So today’s technological innovation is called Wooden It Be Nice. That’s Wooden It Be Nice [laughter]. As sectors around the world aim to reduce their emissions and improve their sustainability, one sector that has come under recent criticism for its excesses is space exploration. We know that I like a bit of space exploration in Future or Fiction?

Matt: Love it.

Fraser: But how about this? In an effort to become more sustainable and reduce space junk, one space exploration group has designed a wooden satellite that can withstand the harsh conditions of space. The satellite can, of course, carry other devices but the main body is made of specially treated wood to make for a less environmentally harmful system overall. Do we think it’s the future or do we think it’s fiction? Who wants to open up?

[Music flourish]

Rebecca: I feel like it would be inappropriate if we went to anyone other than Jeff to kick us off [laughter].

Jeff: So firstly, congratulations on another amazing name [laughter]. I think I come for the names more than Future or Fiction? I’m instantly going towards fiction on this one, not because sustainable satellites aren’t a good idea but what I’m imagining is that the body of a satellite compared to all of the fancy innards, all of the electrical equipment and all of that other stuff that you want a satellite to be doing something with, it’s probably not a great environmental saving overall. The main issue with putting a satellite up in space is the weight of it.

Matt: I love how you’re doing a live cycle carbon analysis there, Jeff [laughter].

Fraser: I should mention, Jeff, that I was at my satellite woodworking shop this morning. I don’t know if that influences whether you think it’s real.

Jeff: Oh, now you say that [laughter], I love it and I’m almost certainly going to be wrong but I think the sustainability of satellites compared to the past of shoving a satellite into orbit is probably quite low on the checklist.

Matt: You think it’s even beneath the greenwashing of Jeff Bezos, Branson and others? The reason I say that is you can actually imagine, possibly, the tagline of ‘it’s satellite technology but don’t worry, it’s green. Well, it’s wooden but it’s green.’ Keith, you’re the engineer. Well, you’re one of the engineers in the room. Is there any credibility in this?

Keith: Well, on the one hand, I think certain kinds of wood are actually pretty good materials in terms of the strength-to-weight ratio. So that kind of makes me think there might be something to it, not necessarily because of the environmental issues but just because it’s quite a good material that you can just grow. On the other hand, the special treatment... I mean you need a certain kind of electromagnetic shielding when you’re out in that very harsh environment and not protected by the biosphere and whatever. Mmm, I think it’s got potentially some plausibility to it but it depends maybe on what Fraser means by the ‘special treatment.’

Fraser: Please don’t assume that I have any capacity to answer that, whether it’s real or not [laughter].

Matt: Titanium coating [laughter]. Becky?

Rebecca: I know you can do all sorts of wonderful things with wood and use it in ways that we probably didn’t initially imagine. I see those wooden watches where you’ve got really great technology embedded in this wooden case but I think that the level of precision that would be required in terms of how the satellite is shaped and the effort that goes into moulding it to get it just so... I’m not sure that you could do the same sort of thing with wood, so I think I’m leaning towards fiction with this one as well.

Matt: Well, I’m at a sincere disadvantage because I think we’ve got two engineers and one natural scientist in the room. My social science degree is not going to do me much good here whatsoever. We’re hearing wood being used for all sorts of different things. I’m seeing you can buy the most fantastic and most structurally sound road bikes now made out of wood. I think it’s possible but I’m with Jeff. Would they bother? Probably not. I’m going to go fiction.

Jeff: The other thing that really terrifies me in this is one of the other ones that you definitely got me with was the community grab, or was it Mars, or the moon, or something like that and I was 100% that that was fact. I’ve tied myself in knots now because... is it a double bluff or is it fiction again? So I’ve promised myself I’d stick with my first answer, so I’m going to go with fiction.

Matt: We’ve had a triple bluff on this show before, Jeff, as well so don’t put it past him. Fraser, put us out of our misery.

[Music flourish and low, steady beat]

Fraser: We’ve got four fictions. Everyone agrees that this is fiction. As ever, I’ll give all of the guests the opportunity to change their answer now that Matt’s given his [laughter].

Jeff: No, I’m going to stick with it [laughter].

Fraser: Sticking with it, Jeff. Keith, we’re sticking with fiction?

Keith: On balance. I was kind of perched on the wooden fence. Which way am I balancing on that fence? Slightly towards fiction [laughter].

Fraser: And, Becky, you’re sticking with it?

Rebecca: Yeah, I’m going to stick with fiction.

Fraser: Okay, the answer is... it’s the future.

Keith: So I think you need to clarify what the special treatment is, Fraser.

Fraser: So satisfying [laughter]. Oh, Jeff, I’ve been...

Keith: I mean that was my get out of jail card.

Fraser: I will.

Matt: Jeff, you had one chance [laughter].

Fraser: I played a fool, Keith, but I’m switched on [laughter]. Becky mentioned this on a call that we had the other day and I thought, ‘Oh no, that’s right, we’ve got Jeff,’ and I was literally thinking, ‘I’m going to have to come up with something and I’m going to have to put the face on.’

Jeff: Yeah, brilliant.

Fraser: So yes, it’s the future. A Scandanavian outfit will launch their first wooden satellite...

Jeff: Of course. It’s not IKEA, is it?

Fraser: [Laughter] They’ll launch their first wooden satellite later this year beating researchers at Kyoto University to be the first to do so. Using a treated birch wood, treated with aluminium oxide, the wooden satellite is more environmentally friendly in production, avoids burning or releasing the more harmful gases associated with typical satellite materials and reduces space debris on re-entry.

Jeff: Well played, Sir. Well played.

Rebecca: Wow! There you go.

Matt: There you go.

Fraser: So there you go.

[Music flourish]

Matt: A huge thank you to Jeff and Keith. It’s been an absolute pleasure, it really has. You’re welcome back any time and a huge thank you to the listeners. If you would like to engage with us, ask any questions, or suggest any topics, be they about satellites or other, please contact us @LocalZeroPod on Twitter but until then, thank you for listening and goodbye.

Rebecca: Bye.

Keith: Goodbye.

Jeff: Bye.

Fraser: Bye, bye, bye, bye, bye.

[Music flourish]

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