How To Save Household Energy Costs In 2030; A Peek Into The Future
When heat waves rocked Europe earlier this year, it left an indelible mark on the continent that will never soon be forgotten.
The consequences of rising temperatures did not stop at creating mortal casualties and thousands of hospitalisation cases, though that was the immediate and devastating effect; they also wreaked havoc by destabilising grid management and energy prices. In Germany and France, average daily energy costs rose to record-smashing levels at €397 and €521 per megawatt-hour, respectively. As a result, consumers were forced to pay more for less.
This rise in energy prices is directly influenced by energy demand during peak times when customers need a lot of cooling. It put quite a lot of pressure on the energy supply already crippled by the Russian-Ukraine crisis.
While renewables play a vital role towards abating demand and energy prices, they are simply not enough. As of 2021, residential buildings accounted for 43% of final energy consumption in the EU. This demand, despite the growth rate of renewables, will not only strain energy grids across the EU but also inflate energy prices for homeowners.
But what more can be done? We must build energy-flexible homes.
What Does an Energy-Flexible Home Look Like?
The key to understanding what an energy-flexible home is and how it works is to know its essence - distributed flexibility.
Distributed flexibility is the ability or tendency of assets connected to distribution grids to receive energy signals from the grids and respond by shifting their consumption or generation patterns.
An energy-flexible home, correspondingly, manages its assets by deploying distributed flexibility. These assets include load appliances such as air conditioners; laundry machines & dryers; boilers & heaters; electric vehicles (EVs); and storage devices, such as batteries. Energy flexibility enables these assets to connect with one another and with the distribution grid. This, in effect, not only opens a pathway for adequate demand response but also grants you, the consumer, the freedom to connect to the grid and trade energy from storage devices and EVs at any given instance.
So, suppose we suffer an energy surge from another heatwave. In that case, the crisis could be easily managed by ESCOs/DSOs and energy consumers through demand-side flexibility or, in other words, home energy flexibility. Besides preserving grid infrastructure, flexibility would also allow the EU to save more than €71 billion on annual energy costs! This is only a glimpse into what is achievable with energy-flexible homes.
Possibilities of Integrating Distributed Flexibility Into Your Homes
Energy-flexible homes are crucial to the future of grid management and energy sustainability. These homes provide a cost advantage on both the demand and supply sides. How can residential users take advantage of this opportunity? Two key means are smart appliances and Electric Vehicles' smart charging.
1. Smart-grid Integrated Assets (Smart Appliances)
One of the first steps is to adapt smart appliances. These home appliances are sensitive to grid signals and can adjust their working dynamics following the technical and economic situation of the grid. This lies in the hands of three distinct stakeholders:
- Asset Manufacturers - brands such as Samsung, Haier, etc., who manufacture smart appliances such as refrigerators, air conditioners, boilers, washers and dryers, etc., can make their products responsive to grid signals through IoT.
- Prosumers / Active consumers - residents (you) who buy these assets and give permission for them to provide flexibility to the grid.
- Energy Service Companies (ESCOs) - use flexibility orchestration solutions such as the FLEXO community manager to manage these flexible assets and their interaction with the grid.
A perfect case of this in action is load shifting. For example, consider your heat pump and/or air conditioner responding to peak demand signals and turning on only outside these peak demand periods. With multiple flexible assets in your home, the possibilities of energy and cost savings are high, and you can leverage them to your economic advantage.
2. Better Use of Electric Vehicles: Smart Charging and V2G
Did you know? Gas guzzlers are out, and EVs are in. Beginning in 2035, all residents of the EU can only purchase and register EVs. This is particularly interesting because it will exacerbate the surge in energy prices witnessed in the already high energy demand mentioned earlier, given that more people will own EVs and want to charge them.
In the same period, it is predicted that 20% of the households in London alone will require air conditioning. This will result in approximately 1.4 GW of extra demand from the city’s local grid during summer peak demand hours. Sudden demand leaps such as this are neither grid-friendly nor wallet-friendly, so what is the way out?
If approximately 20% of all EVs on the road in the UK by 2035 were to enable Vehicle-to-Grid (V2G), they could power around 600,000 air conditioners in residential buildings. What’s more, EV owners will be able to save about £42 (€48) per month.
How does this work? Smart charging helps EV owners adjust their charging behaviours to optimise costs and demand. For example, during peak demand periods, energy prices tend to soar, but with Hive Power’s FLEXO intelligently managing the charging in your wall boxes and charge station operators, EVs can adjust to charging outside these hours to save costs and reduce demand.
V2G, on the other hand, enables EV owners to sell unused energy to the grid. Imagine utilising your EV as a “battery on wheels” that would mitigate the load on the grid while also earning you income either as money or feed-in tariff.
In a Nutshell
According to research, residential energy flexibility is expected to help household consumers save up to €285 annually on energy bills by 2030. Furthermore, energy-flexible homes are projected to prevent 230 million tonnes of greenhouse gas (GHG) emissions.
The major drivers of these possibilities are the stakeholders already discussed above, and to adequately effect these advantages, they require an intelligent flexibility management platform to power these possibilities.
Hive Power is developing technology at the forefront of this revolution. If you are working in an energy service, electric mobility, or appliance company and want access to the algorithms, backend monitoring, and end-user apps that power this transformation, book a demo today.