Blockchain in the energy sector is moving forward - Key takeaways from the EventHorizon 2018

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The EventHorizon 2018 was a spectacular show but at the same time a worthwhile information session on the status quo of blockchain applications for the energy sector. Although there are no solutions market-ready yet, the different initiatives have taken first crucial steps to come closer to real applications. Especially the pitches from more than 40 startups provided some nice examples of what could become possible with the Energy Web Chain. The EWF itself provided first examples of dApps (like Origin and D3A) for the energy sector. The progress that the ecosystem of blockchain in the energy sector has made within the last 12 months is remarkable and makes us confident that we will see more applications than concepts at the next EventHorizon 2019!  

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German Electricity Market in 2017 – records for battery storage and redispatch

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TenneT published its market report for Germany and the Netherlands and provides some very interesting insights:  While wholesale prices increased, power plant operators were facing decreasing revenues close or below zero. The first tenders for renewable generation reached low subsidy-levels below 7€cent/kWh and the market utility-scale battery storage seemed to take-off, but remains a rather small market for now. Redispatch in Germany reached a new record, which lead to costs of more than 1 billion for TenneT alone.

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European utilities focus on regulated business models – a good strategy?

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The sudden decision that Peter Terium, the CEO of Innogy, will leave the company points at an ongoing struggle in the utility sector: The shift to regulated business models that are combined with retail businesses requires high capital investments and increases the vulnerability of the company against increasing competition and dropping margins in the retail sector. How will utilities adapt to this challenge? Will they make use of digitalization to increase their earnings from retail business? We discuss data from the IEA and results of a recent survey among European retailers to find some answers to these questions. 

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The German energy sector in 2016 – Competition gains, but digitalization…

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How did the German electricity sector develop in 2016? This question is answered by the annual monitoring report by the Federal Network Agency in Germany (BNetzA). In this post we summarize the key findings of this report: Competition in generation and retail still on the rise, gas power plants the big winner 2016, renewable capacity increased, but production remained stable and wholesale prices dropped again. 

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6 principles for a market design that enables the energy transition

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The current market design in the energy sector is challenged by decentralization and digitalization. In this post we discuss six economic principles that provide a framework for an efficient market design that is capable of facilitating the energy transition towards renewables and digital services. Among others we discuss the requirement that the market design needs to become more flexible to adapt to local market failures and to an increasing speed of innovation driven by digitalization. 

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German Utilities struggle with digitalization – especially the retail sector

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Utilities in Germany and around the globe strive to become service-based energy providers to address the challenges arising from decentralization and digitalization. In this post we discuss two recent surveys that show two things: Utilities are struggling to enter the smart home market and their adaption of existing digital solutions is very slow. Especially the retail sector does not apply many digital solutions, even though retail is at the heart of a service-based utility. One response to these shortcomings by some utilities are digital attackers that are launched now in Germany to digitize retail business. Is this the right strategy?

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Blockchain in the energy sector – three takeaways from the EUW2017

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At the European Utility Week 2017 and the side event EMART2017 blockchain was among the most discussed topics. For us, three events at the EUW2017 & EMART 2017 were especially remarkable: enerchains first live-trade of electricity and gas, the launch of the test network of the Energy Web Foundation & Grid Singularity as well as the initiate! Startup Award for electron. In this post we discuss the steps taken at the EUW17 by these projects. 

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Disruptive innovation in the energy sector – definition & application to renewables

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Disruptive innovations are supposed to destroy established business models in different markets. For the energy sector, the debate is heating up to which extend certain technologies (e.g. renewables or battery storage) & new digital applications (e.g. AI or blockchain) might disrupt the business case of energy utilities. With this post we provide a basis for this discussion. We built on the definition of disruptive innovation by Christensen and apply this theory to renewables to show that they are actually disruptive for the incumbent energy businesses. 

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Where do the DSOs in Europe see their future? Survey results discussed

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Last year the Vlerick Business School published a survey among 108 executives from DSOs that represent the majority of all customers in Europe. In the survey, 72% of the DSOs mentioned that they are planning to transform their business to a service-based company. But what does that mean? Three services are discussed in this blog post: Data Hubs, active control of decentralized generation/demand response and balancing responsibility

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Asset- vs. Service-based Business Models – Where Lies The Future For Utilities?

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In Germany, E.on and RWE (innogy) separated their core business units into two different companies and it became inherent that utilities have to change their business strategy to survive in a future distributed energy system. Now, what do the two strategies of Innogy and E.on tell us about the future of the utility business in general? In the following we will present to you different business models that have been introduced by PWC (2014). We will try to show how the current strategies of E.on and Innogy fit into this framework.

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The Future Business Model for Energy Utilities in the US: Quo vadis?

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Decentralization, decarbonization and digitalization drive incumbent utilities to change their strategies and business models. But how could the future business model of a utility in the US look like? In this post we pick up this question and dive deeper into the current discussion in the US. 

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Digital platforms in the energy sector – definition & first applications

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Digital platforms are on the rise in many sectors. Currently, the question is raised which role digital platforms could play in the energy sector, especially in distributed systems based on renewable energies.  However, there seems to be no clear understanding of what a platform or a platform market acually is. Therefore, we provide a definition of platforms and platform markets and discuss some potential applications of these in the energy sector.

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Regional Flexibility Markets in Germany - Quota vs. Market Models

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Regional flexibility markets are widely discuss to tackle three issues: First, distributed generators and consumption should be able to provide flexibility to network operators. Second, other market parties should get access to flexibility as well to develop new market products and thereby increase the value of distributed generation and reduce the costs of the energy transition. Third, DSOs and TSOs should coordinate their balancing activities. In this post we introduce the current discussion in Germany how to organize regional flexibility provision.

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Regional Flexibility Markets – A European view on the TSO-DSO interface

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Decentralization is one important aspect of the energy transition. Decentralization drives the need for more coordination between TSO and DSO to secure grid stability. Regional flexibility markets might be one solution to establish efficient coordination between the network operators, the network users and market parties. We discuss in this post 5 concepts that are discussed right now in Europe. 

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TSO & DSO coordination – key for the integration of renewables

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The increasing shares of renewables increase the pressure on the existing electricity system in Germany. The network operators are increasingly applying congestion management measures (redispatch, feed-in management) to balance the grid in times of high production from renewables. While this is currently a primary task of the transmission system operator, the distributed character of the energy transition requires a more decentralized approach. Now, the question how to organize the TSO-DSO coordination efficiently becomes a very important issue.  

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The Coordination Problem: A key challenge for Smart Grids

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Coordination between distributed generation and the network operators is becoming a key issue for the energy transition. With smart grids, the complexity of the coordination issue is increasing. What is the coordination problem, how does it relate to liberalization and why is it becoming a pressing issue for smart grids?  

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Digitalization in the Energy Sector – Challenge accepted?

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Utilities are at a crossroad: They can follow their established paths and focus on their traditional long-term business models. Or they face the challenges of digitalization and adapt to the faster innovation cycles related to digital business models. We discuss the utilities' strategies related to digitization and find arguments that support both scenarios. Which way are the utilities going to take? Let's see. 

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Multi-Use – The Kick-start for battery storage markets?

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The energy transition can gain from battery storage. However, battery storage is not yet profitable in all markets. This changes if the battery provider does not only address one, but many different markets. This is the idea behind the multi-use approach for battery storage. We discuss two challenges for this concept and three potential solutions: dynamic network charges, regional flexibility markets and regulation. 

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