Smart Grids to revolutionise energy use but benefits could bypass consumers

A new report by the UK Energy Research Centre (UKERC), led by researchers at PSI, explores the emerging role of smart grids in the UK and presents a vision of the near future where energy use is monitored in real time, home appliances are automated, and Britain is powered by a network of community-run energy schemes.

Findings from the research show that there is a real appetite for change, both from industry and the public, but the benefits of smart grids need to be clearly communicated and shared. Key challenges must be overcome in preparing for the ‘smart’ revolution – such as low levels of public understanding of smart grids, misuse of data and concerns over energy suppliers remotely controlling home appliances, as well as more fundamental difficulties in predicting how smart grids will develop over time.

‘Smart grids’ include a range of intelligent network options designed to transform the way we produce, deliver and use energy. However, smart grids face a chicken-and-egg problem: there is little incentive to develop them until electric vehicles, heat pumps and renewables are more widely used, but increased deployment of these technologies will require smarter systems in order to maintain a reliable supply of electricity.

Developed using expert and public feedback, the research identifies four possible smart-grid futures or ‘scenarios’: from a world dominated by gas with little smart grid development (‘Minimum Smart’), to one where renewables and electric vehicles are strongly incentivised and developed, leading to a consumer-driven smart grid (‘Smart 2050’).

The ground-breaking two-year study was carried out by an interdisciplinary team of social scientists, urban planners, engineers and energy policy experts from the universities of Westminster, Brunel, Cardiff, Exeter and Nottingham.

Project leader Dr Nazmiye Balta-Ozkan of PSI, says: ‘The UK’s electricity grid is fast becoming outdated, as new technologies and new behaviours change the way we use and supply power. Our increased use of intermittent renewables and electric vehicles will require more intelligent ways of managing and delivering energy. But energy suppliers and the government need to be switched on to consumer concerns about this transition.’

‘Smart grids could allow consumers to benefit from cheaper energy bills by matching tariffs to their usage patterns, as well as enabling more efficient use of energy and more effective integration of large amounts of renewables. However, policy needs to address the long-term issues around risk, innovation and investment, as well as equity so that vulnerable consumers are not disadvantaged’, she adds.

Of the scenarios developed, the least popular with the public was the ‘Minimum Smart’ scenario with just eight per cent support. The preferred option, with 53 per cent support, was the ‘Groundswell’ scenario, which predicts a future where a significant amount of electricity is generated by households and through community-led schemes. Participants chose the ‘Groundswell’ scenario because it showed a strong commitment to renewable energy (cited by 68 per cent of public participants) and offered the opportunity to decrease energy bills (cited by 66 per cent).

Smart meters that can monitor and control energy usage at domestic level are widely seen by experts as being an important part of smart-grid development. However, a lack of strong data-protection and privacy measures (cited by 60 per cent), as well as consumer apprehension about sharing energy data (cited by 49 per cent), were seen by the public as the biggest barriers to future UK smart-grid development.

There was also concern that those on lower incomes would not be able to afford smart appliances and that vulnerable people could be taken advantage of by companies, or miss out on potential benefits. Ensuring that the benefits of smart grids flow to consumers will play a key role in encouraging householders’ participation. The report also highlights the critical need for a long-term, cross-sector policy vision for smart grids, which is likely to significantly enhance investor confidence.

Read the report

Scenarios for the Development of Smart Grids in the UK: Synthesis Report

Further information

Visit the project website: www.smartgridscenarios.org.uk.