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The Topic: Non-traditional business models UTILITY WEEK | 22ND - 28TH JULY 2016 | 13 to account for 60 per cent of final energy consumption – and 80 per cent of electricity consumption – by 2050. Germany's distribution system is the "most complex in Europe", according to think-tank Agora Energiewende. It comprises around 900 distribution system operators (DSOs), including the four large companies – Eon, RWE, EnBW and Vattenfall – as well as 700 municipality- owned utilities. The big DSOs operate a large proportion of the munic- ipality-owned networks as part of 20-year franchise deals. The community ownership model for energy genera- tion is one that is gaining traction in the UK, and further non-traditional business models for our European neigh- bours could begin to take hold here in the future. SOLAR PV CAN ALREADY COVER A THIRD OF GERMAN PEAK POWER DEMAND T he dream of affordable energy storage was always viewed as the Holy Grail for customers, businesses and networks alike – it was deemed possible but never proven. That has changed in the past few years as solar and battery combinations are now becoming affordable in a number of markets around the world. Australia is perhaps leading the world deployment with forecasts for three million batteries to be installed by 2025. In Germany. some 25,000 batteries have been installed, and here in the UK North Star Solar has announced a deal to market its unique Home Energy Management System to 22,000 homes in Stanley Council. North Star Solar has evolved its original PV-only model into the current Home Energy Management System (Hems), which combines PV, battery stor- age and LED lighting, together with free or low- cost broadband access. This new model has been conceived from the outset so that over time it could be entirely viable without any form of government subsidy, while requiring no financial outlay by end-users. Customers save on average 20 per cent on their electricity bills and those in fuel poverty using prepayment meters will see greater savings. North Star operates a radically different model from others in this sector, based on partnerships, co-operation and profit sharing. North Star offers its partners a profit share in order to create social capital to benefit local communities and support business activities. We have announced one deal and have two more council deals likely to be announced shortly plus we are in active discussions with five others. In addition, we are talking to a number of energy sup- pliers about marketing Hems to their customers. Batteries along with solar are going to disrupt the market significantly and will be embraced by the government as it seeks low carbon, affordable, and secure sources of energy. It is moving away from the world of large generation plants with subsidies to embedded local generation without subsidies. This will create huge challenges for DNOs and National Grid, not least of which will be how they continue to recover earnings as less energy moves over the trans- mission lines. As indicated by the National Infra- structure Commission, moving to a smart grid with storage is likely to save the UK significant amounts of money and carbon. Post Brexit, we need to make sure we are leading the way in this new world, innovating in ideas and embracing these changes. The Holy Grail may just be closer than you think. North Star Solar chief executive Paul Massara. He is also the former Npower chief executive, an execu- tive member of Centrica, and he advises the govern- ment on fuel poverty. Comment: North Star Solar and the battery revolution The Big Numbers • 0.3% of the UK's renewable energy is owned by com- munity projects • In Germany 46% of the renewable energy capacity is community owned • There are more than 5,000 community energy groups in the UK • The Community Energy Strategy says there is the potential for up to 3GW of community energy Source: Frauenhofer ISE, EEX Power demand and solar power production in Germany. Estimates on actual data from May 2012 70GW 60GW 50GW 40GW 30GW 20GW 10GW 0GW Midnight 6am Noon 6pm Midnight Total power consumption Solar power production Solar cover one third of demand when demand peaks Market share of German electricity companies Sector Companies Market share Total number of providers Transmission Amprion 100% combined 4 Transnet BW (ENBW) TenneT 50Hertz Transmission Distribution EnBW, Eon The big four distribution companies own and Approximately 890 DSOs, about 500 RWE, Vattenfall operate a significant portion of the distribution of which are municipally-owned system, though the exact level is not clear Stadwerke Total generation EnBW, Eon 56% installed capacity 9 June 2014). Over 1,000 produces (not including RWE, Vattenfall 59% of electricity generated (2012) individuals) Retail suppliers EnBW, Eon 45.5% of total electricity Over 900 suppliers RWE, Vattenfall offtake UK community renewables capacity by country and technology Ownership share of renewable generation in Germany, 2012 Private citizens and farmers Project developers Industry Funds/banks Regional/municipal utilities Big four Other Source: Statisica, 2014 46% 14% 14% 13% 7% 5% 1% Source: SCENE Connect (May 2013) Wind Solar PV Biomass Wood fuel Hydro Solar thermal Ground source heat pump Anaerobic digestion Installed capacity (MW) 30 25 20 15 10 5 0 Scotland England Wales NI