The decade ahead represents a period of significant change for Distribution Network Operators (DNOs) – the licensed companies that own and operate the network of towers, transformers, cables and meters that carry electricity from the national transmission system and distribute it throughout Britain – as the UK strives to digitalise its energy networks and cut emissions by 68% as part of the 2030 Paris Agreement.
A panel of experts gathered to discuss the emerging pressures and priorities for DNOs and the wider energy system, in Icebreaker One’s January webinar hosted by Open Engagement Manager, Vichi Chandra.
“We can’t talk about anything happening in the energy market without thinking about the current context of rising gas prices, the current cost of living crisis, and what that means to people” says Dhara Vyas, Deputy Director, Energy UK. “High prices are – rightly – driving the media narrative right now and that has meant a significant shift away from the UK leading the way on decarbonisation and net zero, to the current cost of living crisis which impacts on everyone.
“However, I think there is a significant, real concern that this should not mean we put the brakes on our journey to achieve a net zero system. It’s really important that we think about this in the context of the consumer.”
Matt Webb, Head of Enterprise Data Management, UK Power Networks highlighted the role of DNOs in making this happen:
“We need to accelerate the connection of low carbon technologies and maximise their use in order to contribute to net zero ambitions. At the same time, we must maintain our core role of ensuring the continuity and quality of energy supply. We cannot lose sight of the fact that we need to keep the lights on”.Matt Webb, UK Power Networks
A period of transformation
January’s Energy Digitalisation Taskforce report made a number of key recommendations detailing what is required to deliver a digitalised and decarbonised energy system.
“One that stood out to me was the call to embed a culture of digitalisation and I think that’s really important”, said Dhara.
“It’s essential that companies across the market are planning for a digital system when it comes to building the right skills and investing in digital assets and activities. DNOs are of course a vital part of that infrastructure, and the networks in fact have a much better understanding of the state of the system than perhaps a lot of other parts of the sector; so it’s vital that they share that across the market in order to help us build the system of the future”Dhara Vyas, Energy UK
It’s a viewpoint shared by Matt. “Digital transformation is as much about culture, behaviours and ways of working. And that’s where we as a sector need to shift to be more open and collaborative. We talk about interoperability a great deal; and that’s about how we align and standardise and facilitate communication and interaction between the different players in this ecosystem.
“The RIIO ED2 business plans that we as DNOs have published in recent months, go into significant detail about how we plan to invest and develop our digital capabilities over the coming years, right the way through until 2028. We find ourselves at a really pivotal and important point in terms of how we meet this ongoing challenge, and ultimately deliver the interoperable energy system of the future that we are all aiming for”.
The shift that is required of DNOs, and the wider energy system as a whole, is significant. As Matt explains, “in normal terms, what a DNO is and does, is quite monolithic. And all of a sudden, to find yourself in a central, facilitating role is a big change to make. Traditional network operation entails fairly passive and predictable systems, and we’re now moving into – and are in the midst of – a far more dynamic environment. We need to help facilitate new forms of service, service providers and business models; increasing competition and consumer choice as well as supporting a flexibility first approach”.
How Open Energy can help
Open Energy is a service that makes it easy to search, access and securely share energy data. It covers the full spectrum of data; all the way from open data to really hard to access, commercially sensitive shared data, where access control is important. The Open Energy service currently includes search and access control, co-designed over the last 18+ months by industry, for industry, with support from and engagement with BEIS, InnovateUK and Ofgem (who sit as an observer on the Open Energy Steering Board).
Gavin Starks, Founder and CEO of Icebreaker One, states:
“The approach that we’ve taken with IB1 and the development of Open Energy has been to ask what are the market design principles for data sharing that can scale to whole markets, and across sectors? This has led the teams to understand how to reduce the friction, and connect data between organisations, without insisting that anyone has to put their data in a particular place. Secure data exchanges are made possible by the adoption of open standards and a shared data infrastructure that underpins cohesion and interoperability across the market.Gavin Starks, Icebreaker One
“What we’ve been focussing on is the really valuable information that tends not to be Open – and in many cases can’t be Open. As soon as you need a set of rules around that, there needs to be a set of legal contracts and a set of processes whereby the control around who can access what recommendations, when, and so on, can be codified. There’s a lot of work there on how we can give that Access Control to the people who hold the data.
“Whether or not that’s a business-to-business context or whether it’s a consumer context; the mode of consent, the process of consent management, and rights assignment to the data are all miles away from what organisations are used to thinking about and dealing with. So there’s a massive amount of work to be done in helping to understand the problems that everybody’s trying to solve, both in terms of infrastructure, but also in understanding what the rules are and how we can bring people together so that we end up with an open marketplace”.
What are the opportunities here for DNOs?
Matt says: “When it comes to data, commerciality is certainly one of those factors we need to think about, and we need to be cognisant of the fact that we work in an increasingly competitive market. However, we need to recognize that we are part of an ecosystem now where that commercial data is key. The key to that is us working collaboratively and trying to establish the common processes and practices that make sure that we’re making consistent decisions.”
Dhara agrees that a whole-system approach is needed: “we have identified all the pieces of the puzzle but now we need to put them together”.
“It’s not just about DNOs but everyone in the sector; the challenge is manifold” adds Gavin. “Leadership needs to come from various different points of the system – government and market leaders – and a lot of the innovation will come naturally from large organisations and smaller start-ups. The question is: how can we do all that together?
“What we’ve tried to create here with the Open Energy programme is space for that to happen. So ultimately we’re here to help bring people together, have the right conversations and really focus on where that business value is and how that interlinks with the overall data strategy; both for individual organisations and for the sector as a whole”.