LEADERSHIP, INNOVATION AND CONTRIBUTION TO THE ADVANCEMENT OF THE ELECTRIC INDUSTRY FOR THE BENEFIT OF ALL UK Power Networks

The disruptive utility transforming the energy sector

Contents

Executive summary...... 04 Introduction...... 05 The changing energy landscape...... 06 Our Innovation Strategy...... 07 Future Energy...... 08 Listening...... 09 Innovating...... 10 Collaborating...... 12 Conclusion...... 13 Partners & Collaborators...... 14

UK Power Networks 03 ENABLING BRITAIN’S LOW CARBON ENERGY TRANSITION BY LEADING THE WAY IN THE UK ON SMART GRID AND INNOVATION Executive summary

Great Britain is in the midst of a once in a generation change as significant for the electricity industry as the advent of broadband for communications.

The volume of carbon emitted in producing electricity in Britain has fallen 40% in just six years. The rise of commercial energy storage is heralding a new era of renewable energy.

We have connected more than 700 high voltage and extra high voltage / EHV generators, and 164,000 LV generators to our network in the last five years alone.

UK Power Networks, the company which keeps the lights on for more than 20 million customers in and beyond, is the disruptive utility leading the way. We are putting in place a future ready grid for a low-carbon world.

UK POWER NETWORKS OPERATING AREA c.20m PEOPLE SERVED 15.8 GW PEAK DEMAND 12.2GW DISTRIBUTED GENERATION ON OUR NETWORKS

04 UK Power Networks DESCRIPTION OF ACHIEVEMENT Introduction

The rapid decarbonisation of Great Britain’s electricity system presents great opportunity and unique challenges to the electricity network. +7GW VOLUME OF RENEWABLE ENERGY CONNECTED TO OUR NETWORKS UK Power Networks is a distribution The challenge in becoming a system BETWEEN 2011-18 network operator. We own and operate operator comes in parallel with a the cables, wires and substations that second major change – that of the rapid deliver electricity from the national decarbonisation of transport. The rise in transmission network into people’s popularity of electric vehicles is a shift that +8000 homes. Our traditional role is to take has the power to transform the air quality of high voltage electricity from the national our towns and cities. It will inevitably place NUMBER OF DISTRIBUTED GENERATION CONNECTIONS ENQUIRIES IN 2018 transmission system and deliver it safely more demand on the electricity network as UP FROM 900 IN 2013 through our cables, wires, substations and vehicles move from the petrol pump to the transformers to our 20 million customers charging point and connect to our network. in 8.3 million homes and businesses across the South East and . Four years ago there were just 6,000 electric 89% vehicles in our three licence areas in London CUSTOMER SATISFACTION IN 2018 However, traditional models are rapidly and the South East of England. Now there are being left behind. We are converting from more than 60,000, and by 2030 we forecast our role of being a Network Operator to there will be more than 4 million. Simply become a System Operator, balancing an building more infrastructure alone to cope increasingly complex and interconnected is not an option. 165K electricity network while maintaining focus GENERATION POINTS CONNECTED TO OUR NETWORK on our core responsibility of keeping the As a regulated monopoly we are lights on. It is a change as fundamental to spending our customers’ money and have the British electricity network as the advent the responsibility to keep our portion of their of broadband was to telecoms. It is a change bills as low as possible, so we are developing that UK Power Networks is embracing. smart solutions to enable EVs to connect at the lowest cost. We have already established our credibility as the utility that can deliver change by Our business ethos is one of innovation connecting unprecedented volumes of and disruption, developing and implementing renewable energy at unprecedented pace. smart technologies to benefit our customers. In the seven years between 2011 and We evidence this by the size and scope 2018 more than 7GW of renewable energy of our Innovation and Smart Grid teams, was connected directly to our networks. which number more than 60 people – That’s almost the same as the UK’s entire and the unrivalled benefits they deliver nuclear power output, in a fraction of the for our customers. We are investing in time and cost it typically takes to build one of more than $91m worth of research and them, and we took it in our stride. The development projects at any one time. Ranked 9th - volume of distributed generation connections Sunday Times 25 Best enquiries rose tenfold from 900 to more than Big Companies to 8,000 work for – Only utility in just five years. Despite the huge increase company in Top 25. in volumes we still achieved a customer satisfaction score of 89%. SUNDAY TIMES

UK Power Networks 05 HOW DISTRIBUTED SOURCES OF ENERGY GENERATION ARE AFFECTING SUPPLY The changing energy landscape

OLD WORLD Centralised Few large generators One-way power flows Customers only consume Predominantly fossil fuel based Predictable Planned Flexibility from generators

Large scale generation Transmission Local distribution Customer

OUR NEW WORLD Decentralised Thousands of distributed Bidirectional Power and information flows Consumers self-produce and consume generators Intermittent Managed Flexibility from demand, storage Hybrid Vast volumes of renewables and generation

Wind farm Battery storage Solar farm

Large scale generation Transmission

Community Electric Connected living Wind farm Vehicle Scheme

Solar farm

Customer Local distribution

06 UK Power Networks DELIVERING INNOVATIVE SOLUTIONS Our Innovation Strategy

Whilst innovation investment is one key measure of how we take innovation seriously, the greatest measure is the benefits this funding unlocks for our customers. $195m SAVED THROUGH INNOVATION INITIATIVES SINCE 2015 Innovation initiatives have saved customers We do this is via a focused innovation $195m since the beginning of the current strategy covering three key strands: regulatory price control period in 2015, which Efficient & Effective is more than any other UK electricity network Developing equipment and processes that Large scale generation Transmission Local distribution Customer by multiples. The business has transitioned 22 help us keep the lights on more safely, 22 innovative solutions into business-as-usual efficiently or environmentally sustainably INNOVATION INITIATIVES NOW over the same period, more than any other ADOPTED BY UK COMPANIES AS BUSINESS AS USUAL SINCE 2015 network operator. Low Carbon Ready Enabling low carbon technology such as Being the most innovative Distribution electric vehicles, renewable energy and Network Operator (DNO) is an important domestic or commercial storage to connect part of UK Power Networks’ vision and we to our network 103 believe we are delivering on that promise. COMPANIES AND ORGANISATIONS Future Ready Innovation is often high tech, but sometimes PARTNERING ON INNOVATION PROJECTS Developing a future-ready distribution it simply takes an original approach and business that meets the needs of applies a low-tech solution, such as deploying tomorrow’s customers woodpecker repellent to protect our wooden poles.

Through innovation we have saved our customers almost ten times as much as the next-best distribution network in the UK, and more than all of other distribution networks combined. We have also turned more innovation projects into solutions that are now a part of our everyday work than any other DNO.

We do not pursue innovation for its own sake; it has to benefit our customers.

OUR SMART GRID PRIORITIES

PRIORITY 1 PRIORITY 2 PRIORITY 3 PRIORITY 4 PRIORITY 5 UK Power Networks is a Facilitate cheaper Use customer Develop enhanced Collaborate with Prepare and and quicker flexibility as an System Operator industry to enable facilitate the forward-looking DNO. connections using alternative to capabilities nationwide uptake of MARK DALY proven innovation network upgrades benefits electric vehicles ELECTRIC VEHICLE PROJECT MANAGER, NOTTINGHAM CITY COUNCIL

UK Power Networks 07 ENABLING THE DECARBONISATION OF ELECTRICITY Future Energy

In 2018 the United Kingdom ran without coal-generated electricity for three consecutive days for the first time since the 19th century. The days of large, carbon intensive power stations transporting 4.1m FORECAST NUMBER OF PLUG-IN ELECTRIC electricity over long distances are over. VEHICLES ACROSS UK POWER NETWORKS BY 2030 Instead, the future is renewable energy, In October 2018 Singapore-based SP Group wind solar and storage, much of it connected produced the first ever global Smart Grid not to the national high voltage transmission Index. Of the 45 utilities benchmarked, UK system but to more local, lower voltage Power Networks was ranked first in Europe 90% distribution networks. and third in the world, and cited as a best- OF THIS ADDITIONAL LOAD WILL practice example for ‘customer satisfaction BE CONNECTED TO THE ELECTRICITY Similarly, the British Government and empowerment’ and ‘monitoring DISTRIBUTION NETWORK announced plans for at least half of all new and control. vehicles, and as high as 70%, to be ultra-low emission by 2030. The target was contained Today there are 60,000 plug-in electric in its Road to Zero Strategy, unveiled in July vehicles across UK Power Networks. 2018. The government’s strategy set out By 2030, barely a decade later, we forecast plans to put the UK at the forefront of a the number will have increased by almost global revolution in mobility and help to 70 times to 4.1 million. We have calculated deliver cleaner air, a better environment 90% of this additional load will be connected and a strong clean economy. to the electricity distribution network, meaning we have a huge part to play in Our Future Smart strategy to transform enabling the roll-out of EVs across the UK. to a Distribution System Operator (DSO) is central to our role in facilitating the low- To address these changes, carbon transition. We are developing our we focus on three key actions: DSO capabilities so our customers can Listening benefit from the smart grid system. Understand our customers and their I am pleased to hear evolving needs; that Transport for London It is crucial that we identify opportunities are working closely to encourage and utilise customer flexibility. Innovating We have led the opening of new market Use technology, innovation and data with the UKPN Team opportunities to use customer flexibility to manage the network better and to upgrade and enable and to deliver the low-carbon transition release capacity power to many locations at lowest-cost to customers. across London. I would Collaborating also like to thank them Collaborate across the industry to come for their continuing up with the best solutions and adopt best practices. efforts in the support and advancement of our strategy for London to have zero carbon transport by 2050.

SHIRLEY RODRIGUES DEPUTY MAYOR OF LONDON FOR ENERGY & ENVIRONMENT

08 UK Power Networks ENABLING THE DECARBONISATION OF ELECTRICITY Listening

Listening to our customers and coming up with innovative solutions to overcome their challenges has been crucial in our success in enabling the UK to decarbonise its electricity network. 1.5m VULNERABLE CUSTOMERS TO BENEFIT FROM FREE EXTRA SERVICES IN THE With customers at the centre of everything Vulnerable customers EVENT OF A POWER CUT we do, we hold regular customer forums – no one should be left behind for energy generators, known as Distributed UK Power Networks serves some of the Energy Resources (DERs), connected to most diverse areas of the UK. From coastal our network. These forums enable us to towns in Sussex and rural villages in north collaboratively design the future electricity Norfolk, to large council estates in East system with the technical, commercial, London, the needs of our customers are consumer and investment professionals varied, complex and constantly changing. who have a stake in its success. As a public service provider we have a responsibility to look after those who Similarly, we now recognise that our need us the most. customers’ needs are changing. Our EV stakeholder map stretches the entire breadth In 2015 we committed to doubling the of our customer segments: the residential number of customers on our Priority Service customer looking to buy an EV; rural parish Register (PSR), and in June 2017 we reached councils understanding their EV requirements; that milestone, enabling nearly 1.5m corporations transitioning their fleets to vulnerable customers to benefit from free electric; government setting the policies extra services in the event of a power cut. to drive the energy transition; and energy In 2018 we became one of the first utility suppliers offering customers the choice companies to achieve accreditation to British to charge their EVs. UKPN is the single Standard 18477:2010. The accreditation unifying party with the driving force to demonstrates we are providing a fair, flexible guide this transition. service that can be used by all consumers UK Power Networks equally, regardless of their health, age or was the first DNO to We are collaborating with a London-based personal circumstances. recognise the value technology start-up, Piclo, to develop an in working with an online platform that would allow anyone independent market to register their assets and get involved platform to lower at no cost. This platform has been transformational in increasing transparency barriers and increase and accessibility and is now used by all transparency for Distribution Network Operators across the customers. UKPN have country. We co-designed the new product shown real leadership features with our customers, responding and as a result we are to their requests by lowering the capacity seeing exciting levels threshold so that small domestic generators of participation on the could participate, and extending the length platform, including the of our contracts to give customers greater hard to reach such as confidence on the return on their investment. community groups.

JAMES JOHNSTON CHIEF EXECUTIVE, PICLO

UK Power Networks 09 ENABLING THE DECARBONISATION OF ELECTRICITY Innovating

Using data and technology to come up with the best solutions.

Generation $91m Our customers told us some renewable KASM is a forecasting and contingency SAVED BY OUR CUSTOMERS TO energy plants can face high up-front costs analysis tool that’s designed to give our DATE THROUGH ACTIVE NETWORK MANAGEMENT to build more capacity if they want to connect control room engineers the confidence they to a congested part of the network. In some need to safely allow more renewable energy circumstances costs can be so high they than ever before onto our network from could result in a renewable energy plant those already connected. Last summer alone being a financially unviable proposition. we managed to save more than 4,000MWh 20,394 In response we developed the world-leading of lost renewable energy production for our TONNES OF CO2 SAVED IN THE FINANCIAL innovation project Flexible Plug & Play, customers – if the same amount of energy had YEAR 2017/18 which became the business as usual been generated by fossil fuels instead it would product Flexible Distributed Generation (FDG), have emitted as much carbon dioxide as 1,500 rolled out across the whole of our networks flights between London and New York. in 2018. FDG allows generators to connect to 4GWh the network for a much lower up-front cost The target for 2019 is to save 10,000MWh, OF ADDITIONAL RENEWABLE ENERGY in return for agreeing to export less electricity which is enough to power 3,000 homes for ENABLED BY KASM IN SUMMER 2018 to the network at the few times of the year a year on 100% renewable energy. So far where supply exceeds demand. To date the software has analysed more than 11,000 this solution has saved our customers more different case studies of running the network. than $91m and in the financial year 2017/18 Up until now analysis like this had been done saved 20,394 tonnes of CO2, equivalent manually we would typically have got to the environmental benefit of about through fewer than 500 in a year. What 250,000 trees. started as an innovation project is now business as usual, and we have calculated Having cut the cost of connecting to our that if rolled out across the UK it will save network, we moved on to looking at how energy customers $85m. we could get more from those renewables on our network. Often the locations best- Having developed innovative ways of suited to renewable energy generation getting renewable energy onto the network – think vast sunny plains or offshore wind at lower cost, and then exporting more once farms – are also places where there is a lower connected, we looked at ways of creating demand for the electricity they generate than value streams for distributed energy Our wind and solar in the towns and cities. This was the case in resources. In 2018 trials began on Power projects would not the rural county of Kent on the South Coast Potential, a world-first project to create a have been built without of England, which has large amounts of wind new reactive power market for distribution FPP being available. power connected off-shore and supply often connected assets to provide support to exceeds demand. constraints on the national transmission That’s a 15MW solar far, system. Power Potential could facilitate £20m ($26m) capital To solve this, in 2018 we completed an additional 3.72GW of network capacity in investment that would a project called Kent Active System the South East region of Great Britain by 2050 not have been possible. Management (KASM). – equivalent to 960,000 homes installing rooftop solar panels – and save consumers CARL SUTTON over $500m if rolled out nationally. MANAGING DIRECTOR OF RENEWABLE ENERGY DEVELOPER THE ABBEY GROUP

10 UK Power Networks ENABLING THE DECARBONISATION OF ELECTRICITY

Electric Vehicles We relish the challenge of Finally, we are developing a toolbox enabling the electric transport to deploy smart solutions instead of 5,834 automatically building more infrastructure. ADDITIONAL LV SUBSTATIONS FITTED revolution and will deliver this This includes the cutting edge smart WITH MONITORING EQUIPMENT BY 2023 through our forward thinking charging trials called Shift. EV readiness strategy. The space on the electricity network Our EV approach comprises is finite, and increased demand created by electric vehicles inevitably means having to $54m three key objectives: spend customers’ money on more capacity. INVESTED OVER FOUR YEARS IN Informing investment and industry TARGETED GRANULAR NETWORK Smart charging is a way of deferring that, MONITORING leading policies and standards by managing how much energy is flowing Delivering great customer experience through EV chargers to keep it within safe limits. By listening to our stakeholders, Developing a network that is prepared we are designing solutions that place the for EV uptake customer at the centre to unlock more than We think the By segmenting our focus into these three $325m for customers who are willing to be electrification of our areas, we are taking a strategic approach to flexible on when they charge their car – and Camden Town depot enabling the electric revolution at the lowest free up capacity for customers who still need to charge their car at peak times. is a world first, right cost to our customers. in the heart of a mega-city. We are Our innovation work on electric vehicles Instead of pursuing a traditional asset has given us advantage and is preparing protection approach to managing and using new technology us for the future: operating the network, based on feedback to work around from a wide representation of all actors in some big obstacles Our three-strand strategy the value chain, we focused our energy to electric vehicle We have developed best in class and efforts on exploring a new market deployment, heralding forecasting Developing industry-leading led angle for charging. Tesla complimented a new generation forecasting tools through projects such UKPN on our customer-centred approach. of sustainable urban as Recharge the Future so we can predict Steven Altmann-Richer of Tesla UK & Ireland delivery services both down to unprecedented granularity when said: “It’s a really important issue and it’s here in London and in great to see UKPN undertaking this project.” and where EV-related load will increase other major cities around on our network. Our trials on smart charging, in collaboration the world. This marks a major turning point We are also investing $54m over four with a consortium of flexibility providers from years in targeted granular network across the smart charging industry e.g. OVO in the cost-effective monitoring. This means we are installing and Octopus, will unlock the true value of deployment of electric strategically-targeted Low Voltage monitoring flexibility for EV customers. We are supporting vehicles which in turn in substations that we forecast will be UK PLC by utilising our network as a Vehicle will play a key role in affected by EV load, with 600 to be installed to Grid (V2G) testbed for five V2G Innovate ensuring the global trend in 2019. We also understand the value of UK projects. toward urbanisation is grid edge equipment in building a wider sustainable. level of LV visibility, this is why we are PETER HARRIS partnering with third party intermediaries DIRECTOR OF SUSTAINABILITY, to collaborate on data. UPS EUROPE

UK Power Networks 11 ENABLING THE DECARBONISATION OF ELECTRICITY Collaborating

Our industry is going through a massive transition and although RIIO-1 performance to date we have great ideas and are committed to support our customers – The lowest cost through the transition, we cannot do it alone. £96.79 £85.94 £78.41 We work in teams and collaborate across all of We developed smart charging technology to our activities. From charities, consumer groups enable UPS to increase the number of trucks to public sector organisations, We understand operating from the depot from 65 to 170 these challenges cannot be tackled alone, and – without needing to upgrade their electricity so we’re collaborating with everyone from connection. And we’re working on five UK Power Industry Highest global brand names to startups with a handful Vehicle-to-Grid (V2G) projects worth a total Networks average company of people and a brilliant idea. of $26m with companies including Nissan, average average disruptive energy suppliers AVERAGE DOMESTIC DISTRIBUTION COSTS In summer 2018 we led several other network and Ovo and Transport for London. (£17/18 PRICES) operators in the UK, Scottish and Southern Electricity Networks, Western Power Distribution Electric vehicle fleets are set to be one and National Grid, in a joint venture to put in of the major drivers of uptake. More than 68% place new measures to accommodate growing of all new cars are purchased by businesses. 10% volumes of renewable energy in the South of To address this we drew together a coalition BELOW INDUSRTY AVERAGE England. Distributed energy generators - such as including global technology conglomerate DISTRIBUTION COST wind or solar farms - all use standard protection Hitachi, the UK’s biggest fleet vehicle operator systems when they connect to an electricity Royal Mail, private hire vehicle network Uber network, mainly to safeguard the generator and utility company to run the world’s from interruptions on the local system. largest ever Fleet EV demonstrator project. This protection also prevents distributed The project, Optimise Prime, will seek to generation from being disconnected, due identify and come up with practical solutions to an interruption on the wider network. to overcome the hurdles preventing commercial vehicles from going electric. In April 2018 our Smart Grid team put this more resilient mode of protection, called In November 2018 Optimise Prime was RoCoF, to the test when we were warned by awarded $26m of investment by our UK Power Networks the national transmission operator of a major government regulator Ofgem to enable has shown it is willing issue that could disconnect generators on our it to proceed. We’re working with Transport to listen to stakeholders, network. With buy-in from the regulator Ofgem for London and the Mayor of London to deliver including those beyond and the national operator, we led a national the capital’s targets for EV charge points. the energy industry. effort that resulted in sites offering to switch They have recognised 1.4GW (1,400MW) of capacity. The consortium We are working on live projects with reached its target and completed all the vehicle manufacturers, chargepoint the importance of upgrade work at a total of 70 sites, saving operators, energy suppliers, fleet operators, listening and sharing our customers $52m. We worked with global the Mayor of London, local public bodies knowledge in order logistics company UPS to use their Central and the Government’s Office for Low Emission to innovate towards London depot as a testbed for reducing the Vehicles. This collaboration will enable us achieving win-win cost of charging freight electric vehicles. to deliver the solutions that will put the outcomes. infrastructure we need in place at the DAVID WONG lowest possible cost to our customers. SENIOR TECHNOLOGY AND INNOVATION MANAGER, SOCIETY OF MOTOR MANUFACTURERS AND TRADERS

12 UK Power Networks KEEPING THE LIGHTS ON Conclusion

The global energy system is going through a period of unprecedented change, and UK Power Networks is at its vanguard.

We have a record of delivering new technology to benefit our customers that few of our peers can demonstrate. We are investing huge amounts of time, resources and energy into being the best Smart Grid in the world.

Our people are passionate, highly qualified and committed because they know what we do matters to our customers.

We are doing all this while never losing sight of our primary responsibility, which is keeping the lights on in London, one of the world’s great megacities, and in millions more homes and businesses beyond.

Amidst all this change and disruption in our industry, we continued to increase our performance and are proud to be Britain’s safest, lowest cost and most reliable electricity network.

By listening to energy retailers and taking this customer-centric approach to smart charging instead of a ‘command and control’ model, UK Power Networks is demonstrating real innovation and leadership.

GREG JACKSON CEO, OCTOPUS ENERGY

UK Power Networks 13 OUR INNOVATION PARTNERS & COLLABORATORS

Academic Power Networks Demonstration Centre Aston University Power Survery Imperial College London Powerline Technologies London South Bank University Powervault Loughborough University Progressive Energy University College London Ricardo University of Cardiff Ricardo (Previously - Power Planning Associates Ltd University of East Anglia Consulting (PPA Energy)) University of Leeds RINA (Previously ERA Technology) University of Southampton Shannon Development Corporation University of Strathclyde Power Networks Silversands Demonstration Centre Smart Wire Grid Tata Consultancy Services Wider Industry Tollgrade Communications ABB Group TQS Intergration Aclara Technologies LLC Turbo Power Systems Baringa Partners Ubitricity Distributed Energy Systems UK BYD UK United Parcel Service CAG Consultants Upside Energy Callen-Lenz Associates Wilson Transformer Company Cap Gemini Yambay Captura Surveying and Inspection ZIV Automation Capula CGI Government bodies (incl. councils) Charge Point Services BEIS Contrôle et Maintenance Bromley-by-Bow Community Centre EA Technology Department for Transport E-Car Club Durham County Council EIC Element Energy Future Cities Catapult Elimpus Greater London Authority Elmeridge Cable Services Innovate UK ENEIDA.IO Institute for Sustainability Energy Systems Catapult Office for Low Emission Vehicles Enging Ofgem Enzen Southend on Sea Borough Council EV Consult Tower Hamlet Homes Everoze Partners Transport for London Exact Projects Transport Systems Catapult Frazer Nash Consultancy Freedom Group Utilities GE Grid Solutions British Gas Go Ahead Group Cadent GridON EDF Energy Horizon Utility Supplies Kinetricts International Europe Energy Networks Association Melba Products eON UK MIR Innovation Canada National Grid National Grid Gas Trasmission National Physical Laboratory Northern Power Grid Navigant Consulting Octopus Energy / Electric Vehicles Nexans UK OVO Group Open Energi Scottish & Southern Electricity Origami Consultancy SP Energy Networks Piclo Energy Wales and West Utilities Poplar HARCA Western Power Distribution

14 UK Power Networks

FSC – Forest Stewardship Council. This ensures there is an audited chain of custody from the tree in the well-managed forest through to the finished document in the printing factory.

ISO 14001 – A pattern of control for an environmental management system against which an organisation can be credited by a third party.

Contact Details

[email protected] Carbon Balancing by the World Land Trust ukpowernetworks.co.uk/innovation tackles climate change through projects that both offset carbon dioxide (CO2) @ukpnnews emissions and conserve biodiversity.