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UTILITY Week 28th October 2016

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14 | 28TH OCTOBER - 3RD NOVEMBER 2016 | UTILITY WEEK Operations & Assets Analysis T he Low Carbon Networks and Innova- tion (LCNI) conference, now the energy networks' de facto event for dissemi- nation of findings from funded innovation schemes, took place last week on Electricity North West's patch in Manchester. The event drew a hey delegate crowd, along with some high-profile speakers – most notably Ofgem chief executive Dermot Nolan. There was also a broad selection of exhibitors, large and small, who displayed solutions to network challenges ranging from advanced asset management soware to drones, gas leak detection devices, fault current limiters, system planning tools and energy storage technologies. For some, Nolan's keynote presentation raised concerns about the future of inno- vation funding, which is currently under review by the regulator. However, it also gave insight into the numerous ways in which Ofgem is getting deeply involved in the chal- lenge of creating a smart energy system. Nolan announced a range of initiatives, which the regulator hopes will enable it to take an open-minded and flexible approach to this challenge. One is the launch of its Future Insights programme of reports, which will explore key themes such as low carbon heat and local energy markets, including the scope for distribution system operators. Another is the initiation of a new "Innova- tion Link", designed to make Ofgem and the regulated energy landscape more accessible to entrepreneurial technology suppliers. Multi-vector thinking Another focus of discussion was the move towards "multi-vector" and integrated think- ing about energy systems. It is a topic which, just a year ago, many saw to be interesting, but in the realms of theory and far from mar- ket. But speakers at LCNI this year showed that the need for whole-system thinking is now a common conclusion of energy inno- vation projects. In some cases, debate even showed appetite for pushing beyond tradi- tional energy vectors in an effort to improve the efficiency of energy transfer – opportuni- ties for exploiting the "energy-water nexus" as well as crossovers with the waste and transport sectors were mooted. In spite of this increasing interest though, there are very few network innovation schemes that are actively exploring multi- vector energy opportunities. Some say this is because historically the structure of the Low Carbon Networks Fund (the forerun- ner of the NIA and NIC) made it difficult to get such projects off the ground, by block- ing the transfer of customer value between networks. Such barriers seem to have been reduced, however, and this year Western Power Dis- tribution launched Hydrogen, Heat, Fleet – an ambitious multi-vector energy project focused on uncovering synergies between a low carbon gas network, power and trans- port. Another project, at National Grid Gas Transmission, has found that enormous sys- tem efficiencies could be achieved by linking the production of Bio-SNG (synthetic natural gas) with black bin waste streams. Gas networks Gas networks are arguably the leaders when it comes to calls for whole-system thinking about energy – and it is no surprise when you consider the struggle they have had in the past decade to maintain a place in low carbon visions of the future. An LCNI session on the future of gas in the UK made it clear, however, that a sig- nificant body of evidence now exists to show why gas must continue to play a role, partic- ularly in the delivery of heat and, to a lesser extent, in powering transport if hydrogen networks reach scale. The same is true for district heating, as well as the much-maligned electric heat pump and a range of other technologies, including hybrid and gas-powered heat pumps and micro-CHP boilers. If gas networks are to successfully and convincingly argue a case for their existence in a low carbon future, they need to embrace this diverse future and ensure they are not perceived as defensive or anti-progress. In terms of technology focus at LCNI 2016, there was a strong focus on asset per- Networks and innovation In a changing energy landscape, the Low Carbon Networks and Innovation Conference remains a key barometer of network innovation activity and direction. Utility Week reports. Five key points to take away 1. The challenge of transforming the energy system is not going away or getting any easier, but expressions from the regulator and government show it is a challenge that now has its full attention. 2. Whole-system thinking is pushing beyond just multi-vector and integrated think- ing to considering the opportunities for exploiting the energy-water nexus and crossovers with waste and transport. 3. For gas networks to secure their place in the low carbon future they must embrace a diverse heat market and ensure they are pro-change. 4. Investment in smart asset performance strategies will pay back up to 20 or 30 times the upfront system costs within a year through proactive, condition-based asset performance management. 5. The traditional command and control hier- archy in the networks industry is being challenged by the rise of third parties, with the possibility of innovation funding access being granted under consideration by Ofgem.

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