Current± talks to Conor Maher-McWilliams, head of flexibility at energy tech firm Kaluza, on what’s needed to tap into consumers’ inherent energy flexibility and how it is taking its technology platform forward.
Can you provide some background into what Kaluza is and what it means for customers?
Kaluza is a residential, intelligent energy platform which connects to a range of devices in customers’ homes, including electric heating systems and electric vehicle charge points, and optimises their inherent flexibility to provide services to energy suppliers, DNOs and grid operators. The whole model is based around a wide range of different hardware integrations, either hardware we’ve developed ourselves or through partnerships, so we can offer a wide range of products to customers and then pass the value we generate in flexibility markets back to those customers.
What are some of the main challenges in tapping into that inherent flexibility?
In any integration, there’s a playbook we follow and there’s work to do on the technical side of things, but it’s work we understand well, we’re pretty expert in that. Some of the challenges we face at the minute sit outside of the platform, things like installation, so some of the processes by which we have to register new assets or devices in customers homes with network operators for example aren’t streamlined, aren’t consistent and cause delays in the customer journey. That can be quite a big cause of frustration.
Once we have the devices installed, the flexibility markets themselves aren’t designed to recognise the true value of flexibility on the low voltage network, the markets are fractured, they all have slightly different processes and procedures for entering and then the products they procure are not amenable to unlocking the full value to the system.
What’s needed to help or alleviate some of those hurdles?
There’s a whole range of things that need to be done. One of those is at that installation point, we need the network operators to really commit to streamline those processes and make them common across all of the regions, so that it doesn’t impact the customer experience when they’re trying to adopt some of these technologies.
There are lots of promising policy statements from government like the Smart Systems and Flexibility Plan, they’re good statements of intent, but we find that often, once you get into the details, there’s a bit of misalignment. The one that’s most commonly cited on that front is the Targeted Charging Review. With things like network charging we feel there’s a real, crucial opportunity to engage flexibility right across the network by exposing any new device that’s connected to the network to early price signals that incentivises anybody who installs that device to extract and use its flexibility. That’s an area for concern at the minute in our point of view, that that opportunity will be missed to the detriment of what we’re trying to achieve.
When you get to the markets themselves, there’s a lot of talk about it but there’s no ESO to DSO coordination to speak of at the minute. All the markets have been designed for large, commercial or industrial and large-scale generation plants. Things like what’s an appropriate metering standard for residential assets, it’s clearly not the £300 meter you’d put on an industrial-scale battery, so that appropriate standard needs to be clearly defined and transparent to the market.
We’re active in a range of flexibility markets, including the newly-emerging DNO markets, and once you get into actually trying to deliver you encounter lots of challenges which need to be overcome. We need a concerted effort from government to keep promoting flexibility and really focus on this opportunity we have in residential-scale assets. There’s a lot to do, and it’s time to double down on their efforts to get the job done.
And I guess the overarching need for a lot of this to happen was really underpinned by the recent power outage in the UK?
Absolutely, that’s a re-emphasis of the importance of having flexibility built into the system and again, when we think about what’s going to happen over the next ten years with regards to electric vehicles, if we don’t have that flexibility built in from the outset, then – electric vehicles have a huge potential to alleviate some of the network stresses and provide key grid resilience – if we get it wrong, it has the potential to exacerbate those problems and make it worse.
We can’t emphasise enough how important this period we’re in at the moment is to lay the foundations for their participation in a resilient smart grid.
What’s next for the Kaluza platform then to take it forward?
The big focus for us at the moment is scale, and that breaks down into two pieces. The first is making a big effort to secure more partnerships with hardware manufacturers. For us, scale and density on the network is key, so integrating with a wide range of products via our supply partners is crucial. The second part is how do we support our supply partners to build compelling propositions to pass this value we’re getting back to the customers in the most meaningful way. There’s also a big focus on how do we drive as much volume through these existing propositions that we have as possible.
Alongside our scale effort we are working on integrating the Kaluza platform into more parts of the energy system through both BAU activities and innovation projects by entering new markets and integrating with more price and network signals. We are particularly excited about our Shift project with UKPN which will demonstrate how our intelligent platform can alleviate problems on the network by optimising EV charging. All of this enables us to create more value for end customers - through savings off their energy bills and from the flexibility they offer to the system.
Conor Maher-McWilliams is speaking at next month's EnTech conference, held at 99 City Road in London's Shoreditch. The event takes place between 8 - 9 October 2019, with more than 150 energy technology professionals expected to take part. More details on the event and how to attend are available here.