Digitalisierung in der Energiewende am Beispiel der TenneT Blockchain-Piloten

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1 Digitalisierung in der Energiewende am Beispiel der TenneT Blockchain-Piloten Ariette Franke - TenneT TSO

2 TenneT a leading European TSO GRID > 22,000 km END-USERS > 41 Mio EMPLOYEES > 3000 INVESTMENT next 10 years 25 billion 2

3 Key Tasks TenneT 1 Transmission services planning, constructing and maintaining a robust high and extra high voltage grid 2 System services maintaining the balance between electricity supply and demand at all times 3 Market facilitation facilitating a smoothly functioning, efficient, liquid, and stable electricity market 3

4 Innovation drives the Energy System of the Future Decarbonisation and the resulting decentralization of power supply raise demand for digital innovations. 4

5 Renewables challenge the Grid Renewables fundamentally change how power grids work The old Electrical Power System The new Electrical Power System Big fossil or nuclear power plants close to the industrial centers feed electricity into the transmission grid. The connected distribution grid supplies consumers. Renewable energy, produced locally, sometimes far away from industrial centers and storage facilities provide electricity at all grid levels depending on the weather. 5

6 Distributed Flexibility With an increasing amount of volatile renewable energy in the system, an optimal dispatch of flexibility options is needed to guarantee security of supply and affordability. Flexible supply 6

7 GW GW Flexibility potential in Germany In Germany electric vehicles, charging stations and PV-battery storage systems provide great potential for distributed flexibility Grid connected capacity of electric vehicles Battery storage capacity High potential for distributed flexibility: The potential of battery storage for Germany alone lies between GW by 2030; Large bandwidth of possible development due to uncertainty of market penetration; Even if at the lower bound, some 3-5 million single flexibility sources would need to be managed. *Source: Agora Energiewende (2014), Stromspeicher in der Energiewende 7

8 Unlocking Flexibility by Blockchain Blockchain technology offers opportunities for efficient market integration of distributed flexibility providers in a system with a progressively smaller fraction of large scale centralized assets. By reducing transaction time and costs, blockchain technology has the potential to empower prosumers, creating a customer empowered energy system The technology therefore potentially increases energy supply and thus can help stabilize grid costs Intermediaries, like power suppliers, will play a smaller role in facilitating a functioning energy market Blockchain potentially provides a transparent, easy to access, and safe platform for trading system services Combining smart contracts with the blockchain allows for automated balancing of supply and demand 8

9 What is a Blockchain? Transactions without blockchain Transactions with blockchain A blockchain is a distributed and shared database that facilitates transactions Transactions are aggregated in blocks that are validated and added to the so called blockchain The blockchain is a growing chain of blocks of transactions, documenting transaction history and validating transactions Blockchain technology in connection with smart contracts allows for a high degree of automatization and security, drastically reducing transaction costs Note: Bitcoin operates on the basis of Blockchain technology, but a Blockchain can be used for many more applications than just cryptocurrencies. 9

10 Public vs. Private Blockchain Attributes of public and private blockchain Source: PWC, IBM, dena Public Blockchain Anonymous and free access Users can directly trade with all other users Decentralized data storage Verification performed by Peer-to-Peer network No ex-post revision possible No operator fees but reward for providing computing power Examples: Bitcoin, Ethereum Private Blockchain Participants are known and invited Contracts between customers through operator s platform Centralized data storage Verification performed by operator(s) Ex-post revision possible (e.g. in case of legal dispute) Operator fees Examples: Nasdaq LINQ, Barclays Corda When participants are known, a trusted consensus is achieved at low cost BUT when participants are anonymous it s expensive to achieve consensus. 10

11 Electricity consumption of Bitcoin Bitcoin energy consumption index as of November 2nd, TWh/a Bitcoin s electricity consumption has been constantly increasing and represents already 1/3 of the total Austrian electricity demand Electricity consumed per transaction on November 2 nd, 2017: 217 kwh Source: Digiconomist 11

12 Ancillary services via Blockchain In two pilot projects with Sonnen and Vandebron, TenneT is using a private blockchain to balance the grid. Objective: gaining practical experience with blockchain technology and interfacing with existing TenneT systems and processes. Building on existing blockchain implementation: Hyperledger is an open source collaborative effort created to advance cross-industry blockchain technologies Two parallel applications: Vandebron provides automated secondary control reserve from a pool of charging stations for electric vehicles (afrrapplication) Sonnen pools household batteries to provide redispatch / congestion management services The flexibility is managed by TenneT via an IBM blockchain solution and used to balance the grid Platform-based services intended to become accessible for all market participants once the pilot runs successfully 12

13 TenneT s Blockchain pilots in brief 13

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