Supply chain reactions

The second part of our round-up of industry body Energy UK's annual conference highlights both high hopes and frustrations over wind power, and warnings for SMEs over cyber security.
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23.10.17
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THERE have been plenty of milestones to celebrate for those working in renewable energy of late.

Britain’s first working day without burning coal since the Industrial Revolution was quickly followed by a day when renewable generation accounted for 52% of electricity consumption earlier in the year.

But, as industry body Energy UK discussed at its annual conference in London last week, the changing energy landscape brings with it a host of challenges.

As the first part of our round-up explained, the event raised as many questions as it provided answers. And there were plenty of other talking points:

The UK is superbly situated for offshore wind

“You can scour the world for the right sea depth and wind speeds, and you won’t find anywhere better than the North Sea,” according to Matthew Wright, managing director of DONG energy.

But the panel agreed there was work to do if the UK is to make the most of the situation. “We have to continue to work with the UK supply chain so that they are supporting not just UK projects but so that they are going global,” he said.

Liberal Democrat MP and former Energy Secretary Ed Davey said the next challenge was to ensure clean energy was combined with smart technology, interconnectors, demand-side response and battery storage to ensure it was more reliable.

Generic image showing onshore wind turbines behind a solar farm
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“Once that’s in place we can see the offshore wind element of our power supply expanding. I would like to see greater development of supply chain. We are a world leader and we need to capitalise on that. We need to push that hard and fast so the British economy and jobs really benefit.”

And the price can still come down

Wright highlighted the fact that auctions last month saw contracts awarded to two offshore wind farms – including DONG Energy’s Hornsea 2 project – at a record low price of £57.50 per megawatt hour.

“As wind farms get more efficient we aren’t sending technicians on a boat every day, we are sending them out for two weeks on and two weeks off,” said Wright. “There’s no suggestion at that that we have reached the bottom in terms of effectiveness and efficiency of offshore wind.”

But there are limitations

As Karen Turner, director of the University of Strathclyde’s Centre for Energy Policy, pointed out: “The more you go further out to sea and you’re working in deeper waters the more difficulties there are; I know there have been cable problems… We could just end up with stranded assets at sea.”

However, noting that Statoil had begun operating the first floating turbines off Peterhead in Aberdeenshire earlier in the week, she said they could be part of a mix of solutions that could work together on an industrialised scale.

A wind turbine seen from below, at Dong Energy's Burbo Offshore Windfarm, off Merseyside

Meanwhile, Minister for Scotland and former Conservative MEP Lord Ian Duncan spoke of his frustration as “time and time again the EU focused on gas” and turned its attention east, instead of furthering the possibility of a North Sea grid. Working groups had been exploring the idea of interconnecting offshore wind energy supplies in western Europe, and projects were scoped between Norway, the UK, Belgium, the Netherlands, Germany and Denmark.

But Lord Duncan said the Brexit process had probably killed off any chance of progress, adding: “It’s a great pity because we need to think about interconnectivity – how we connect to Europe and how Europe connects to us.”

The regulator is keen to shake things up

In a combative speech, Ofgem chief executive Dermot Nolan said the energy regulator was looking into a process of collective switching to automatically shift people en masse away from poor-value tariffs. “The switch would be made on their behalf without them having to do anything. It’s a bit like allowing competitive deals to find the customer rather than the customer having to find competitive deals,” he said, adding that any such change would require legislation.

Nolan also stressed the importance of regulation keeping pace with technological advances and indicated he would be willing to open up the licencing system to allow new types of supplier to enter the market.

In the same way PayPal allows consumers to bypass banks, peer-to-peer trading platforms “could allow consumers the convenience of buying their power directly from local, renewable small-scale generation and bypassing suppliers,” he said.

“In the future, car manufacturers could buy and sell energy to households via their electric vehicle batteries and thus help balance the system. Technology companies selling ‘smart’ household products like fridges and televisions may want to supply energy and related services as part of a good value package. Will these changes make suppliers’ role as middleman less relevant – or even redundant?”

This brave new world brings risks

Haydn Povey of Secure Thingz, which supplies security products to firms working with smart devices, told the audience that cyber security would become increasingly important. “An energy company putting batteries in people’s homes told me they need military security around this because if someone can attack this and then set the house on fire,” he said.

Povey asked delegates: “Who on your board is responsible for security of your products and making sure your system doesn’t go down? There has to be a C-suite person who’s responsible.”

A panel dedicated to the subject heard that the increasing number of small power generators connected to the grid – many with smart technology incorporated – posed a risk to the system.

Electricity pylon and power lines in field in centre of frame captured by drone
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“It’s not just having more renewables on the system, distributed generation, you’re going as far as consumers’ solar panels on roofs,” pointed out Barbara Vest, Energy UK’s director of generation.

And don’t stop at your own security

National Cyber Security Centre deputy director Peter Yapp warned that SMEs were making up a higher proportion of those targeted by attacks. “Increasingly attackers are using supply chains to gain access to targets. It’s not enough simple to know your own organisation, you need to know you supply chain as well. Attacks are so regular and cross-sector that the more we all share the safer we will become.

Jon Longstaffe, who oversees European cyber security for Siemens, said the issue was not being taken seriously enough across the board. “We get a range of different situations from 20-30 pages of questions about security to one line in a contract where it says ‘do some security stuff’,” he said.

“One contract said ‘follow our security policies’ but the company hadn’t written them yet,” he said. “Your supply chain is absolutely critical to you. If you start incorporating even a simple piece of equipment, what’s inside it? Have that conversation with your supply chain, don’t wait until there’s an incident. It will be cheaper and easier for you and have a better outcome for customers if you build in security from the beginning.”

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