Plexigrid is Testing Innovative Dynamic Grid Tariffs in Gotland
The growing number of electricity consumers strategically adjusting their energy consumption based on hourly fluctuations in the spot price on electricity exchanges poses a significant challenge for efficient grid management, particularly for network distribution companies. This trend is especially pronounced in the Nordics, known for their high penetration of Distributed Energy Resources (DERs), including solar and wind power.
However, current price signals in these vast electricity areas often lack the granularity needed to reflect the substantial local variations in grid load, regardless of the hourly spot price. This can lead to suboptimal energy usage patterns and strain on the grid.
Plexigrid’s Digital Twin addresses this challenge by providing granular insights into local grid conditions, enabling more precise and localized price signals. By harnessing this detailed information, consumers can make even more informed decisions about their energy usage, balancing their personal cost-saving goals with the broader needs of grid stability and efficiency.
In this new and innovative project run by Energicentrum Gotland and financed by the European Union, a price model based on a combination of the spot price and the load factor in each grid station in the local electricity grid will be tested.
Plexigrid is proud to collaborate with GEAB, the local electricity grid company, and Ngenic on this innovative project. Our cutting-edge AI-based system, developed in-house, forms the backbone of this revolutionary tariff model.
Plexigrid’s platform leverages real-time price signals, weather data, and historical consumption patterns to generate a daily capacity map for the grid. This map provides a detailed view of the expected load at each node, enabling precise forecasting of tariffs and optimized resource allocation. Our AI-powered calculations factor in the anticipated impact of price forecasts on customer behavior, ensuring a dynamic and responsive approach to grid management.
Peak Load Management with Dynamic Tariffs
By 2027, Swedish regulations will require all power grid companies to implement flexible power tariffs, which charge customers based on their actual power consumption, especially during peak times. This mandate is part of Sweden’s broader efforts to improve grid efficiency, manage peak load demand, and integrate a higher share of renewable energy.
However, the design of these tariffs is left to individual companies, often resulting in static pricing models based on monthly peak consumption.
In contrast, the pilot project led by Energicentrum Gotland offers a dynamic tariff model that reflects real-time grid conditions and customer behavior. This approach incentivizes active energy management, benefiting both participating customers and the grid. By reducing the need to oversize the network, this model promises long-term cost reductions for all customers.
Smart Grid Solutions for Low-Voltage Network Optimization
By integrating Plexigrid’s intelligence with Ngenic’s smart home technology, customers gain a comprehensive solution for optimizing their energy consumption based on real-time, hyper-local price signals.
Plexigrid’s AI-powered platform refines its forecasts every quarter using real-time electricity usage data, ensuring accurate pricing for each unique grid location. This is especially valuable for areas like Gotland, which have distinct energy conditions compared to the rest of Sweden.
Customers can easily monitor their location- and time-specific prices through Ngenic’s user-friendly app, which visually displays price fluctuations based on grid load. The long-term vision is for customers to effortlessly automate their energy usage based on these signals, for example, by charging electric vehicles during periods of low demand and low prices.
This integrated solution offers a new level of control and flexibility for customers, while also providing valuable insights for grid operators to manage demand and ensure stability. It complements or even replaces existing local flex markets, empowering customers to actively participate in the energy transition and contribute to a more sustainable energy future.
The end goal is to use the power grid in a more efficient, smart way. Increasing the utilization rate of the existing network through the insights of Plexigrid’s platform.
As stated by Magnus Jennerholm for Energi.se “The important thing is that we can increase the utilization rate in the electricity grid by optimizing the use. This means that we do not need to expand the electricity network as much as we would otherwise have needed to”.
This pilot project represents a significant step towards a future where grid management is not only responsive to changing demands but also actively contributes to a cleaner and more resilient energy landscape. By embracing cutting-edge technologies like those offered by Plexigrid and Ngenic, Sweden is leading the way in the transition to a smarter, more flexible, and sustainable energy system.
Energicentrum’s Tariff Strategy
- Improved Tariff Model: The new model provides a more comprehensive approach to managing load, benefiting active customers in the short term and reducing overall costs in the long term by avoiding network oversizing.
- Composite Price Signal: The model combines the spot price with a variable energy fee to create a single, dynamic price signal, encouraging the use of renewable energy and promoting local grid balancing.
- Impact Evaluation: Part of the project assesses how the new grid price signal compares to the traditional spot price in influencing customer behavior.
- Long-Term Benefits: A dynamic pricing approach aims to prevent rising grid costs, electricity quality issues, and delays in connecting new electrification projects.
- Increased Efficiency: By better understanding real grid usage through measurement, the model aims to optimize grid operation, reduce losses, and enhance reliability.
- Lower Costs for All Customers: More efficient grid usage leads to reduced electricity grid prices over time, benefiting all customers, not just those actively managing their consumption.
The Cost of Spot Price Tariffs
While spot price tracking helps balance supply and demand on a national scale, it overlooks localized conditions and bottlenecks in the distribution network. During high-demand periods, many users reduce their load in response to high spot prices, which can lead to imbalances and increased pressure on already constrained sections of the grid. This mismatch risks power losses and even interruptions, leaving parts of the grid underutilized or unable to support all users equitably.
By introducing differentiated local price signals, a smarter tariff system can drive a higher grid utilization rate, helping balance loads more effectively and reducing the need for costly upgrades.
Other Blogposts by Plexigrid
- Exploring the Role of AI in Energy Forecasting and Grid Management
- DSO IT Architecture for the Future Energy Landscape: The 5th Dimension
- Driving Excellence: Best Practices in Software Development and Plexigrid’s Approach
- Plexigrid and University of Oviedo Launch Seminar and Control Center of the Future
- Counties Energy and Plexigrid’s Strategic Partnership for a Energy Sustainable Future
