Smart local energy systems (SLES): A framework for exploring transition, context, and impacts

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Highlights

  • There is ambiguity in how smart local energy systems (SLES) are conceptualised.

  • SLES deliver energy services as well as environmental, social and economic benefits.

  • ‘Smarts’ are provided by ICT, data, automation, and enhanced control.

  • Locality is hard to define and depends on system goals, actors and infrastructure.

  • SLES goals may not be realised unless they are mapped to system elements.

Abstract

Energy systems globally are becoming increasingly decentralised; experiencing new types of loads; incorporating digital or “smart” technologies; and seeing the demand side engage in new ways. These changes impact on the management and regulation of future energy systems and question how they will support a socially equitable, acceptable, net-zero transition. This paper couples a meta-narrative literature review with expert interviews to explore how socio-technical regimes associated with centralised systems of provision (i.e. the prevailing paradigm in many countries around the world) differ to those of smart local energy systems (SLES). Findings show how SLES regimes incorporate niche technologies, business models and governance structures to enable new forms of localised operation and optimisation (e.g. automated network management across energy vectors), smarter decision making and planning, by new actors (e.g. local authorities, other local stakeholders), and engaging users in new ways. Through this they are expected to deliver on a wide range of outcomes, both within the SLES boundary and to the wider system. However, there may be trade-offs between outcomes due to pressures for change originating from competing actors (e.g. landscape vs. incumbents in the regime); understanding the mapping between different outcomes, SLES elements and their interconnections will be key to unlocking wider benefits.

Introduction

Energy systems around the world are changing in response to global challenges and targets to limit climate change. They are becoming increasingly reliant on decentralised renewable or low carbon generation resources, experiencing new types of loads such as electric vehicles, heat pumps, and storage, incorporating digital or “smart” technologies, and seeing the demand side engage in new ways (Edenhofer, 2015; Rogelj et al., 2015). These changes impact on how energy systems are designed, developed, managed, and regulated. They also raise questions around how emerging energy system transitions can ensure a socially equitable and just transition (Patterson et al., 2018; van Veelen and van der Horst, 2018). Understanding emerging energy system transitions in terms of the sorts of benefits they may deliver, the implications on social and technological system elements, and the socio-technical pathways through which change occurs is essential to ensure that policy makers, investors and the wider industry are able to plan for, develop, and deliver a net-zero and socially equitable and acceptable future.

Current practices of energy system planning and management are based on traditional paradigms of centralised generation and top-down system operation. However, the increasing prevalence of decentralised generation is driving a shift toward more localised scales of energy provision and management practices. In the UK this is exemplified by the ongoing DNO–DSO transition, encouraging more active management on distribution networks and the provision of ancillary services at increasingly localised levels.1 It is further illustrated in the upsurge of microgrids around the world, often focussed on delivering increased reliability, resilience, and security of supply (Howell et al., 2017), and the increasing interest and business models and markets around peer-to-peer energy services, which allow end users to become more active energy system participants (Parag and Sovacool, 2016).

The decentralised nature of renewable energy has also seen the emergence of new types of stakeholders, including community groups and grassroots organisations, local authorities, and local enterprise partnerships working alongside private sector businesses (Devine-Wright, 2019). The diversification from traditional system actors introduces new goals and values around what local energy systems could (or should) be delivering in addition to traditional energy services. This includes meeting local social, economic and environmental needs, contributing to broader environmental challenges, delivering economic growth and prosperity, creating jobs and providing new skills training (Devine-Wright, 2019).

Aligned with these changes is a push toward digitalisation (Energy Consumer Market Alignment Project (EC-MAP) 2018; IEA 2017), exemplified by the introduction of smart meters, greater prevalence of “Internet of Things” devices in homes and businesses, and increasing sophistication of automation (e.g., artificial intelligence) used to provide system services. This “smartness” provided by digitisation is driving exponential growth in the scale and diversity of data available to system actors, presenting opportunities and challenges in equal measure (Pullum, 2018).

In the UK there has been a plethora of demonstration projects, incorporating both traditional and emerging energy system actors, to explore the challenges and opportunities associated with a shift toward low carbon, smart, local energy system development and delivery (Flett et al., 2018). Such demonstration projects are critical to support innovation, however most focus on delivering technology specific learning, paying little attention to the wider societal or policy context, or contributing intellectually or theoretically to the broader socio-technical transition that they are helping to deliver (Flett et al., 2018; Frame et al., 2018).

This paper presents findings from a meta-narrative literature review, coupled with interviews focussed on the conceptualisations of smart local energy systems, and explores the socio-technical transition emerging through increasing energy system digitalisation and decentralisation. It aims to assist those planning, implementing or regulating smart local energy systems understand more precisely how projects are ‘smart’ or ‘local’, what this means in terms of technological or social change, and how this might contribute to the delivery of anticipated benefits.

As this paper will show, definitions or descriptions of SLES are not forthcoming in the literature; these systems are generally discussed without being clearly defined (probably due to the relative novelty of the precise concept). However, previous work has explored and defined concepts of “smart energy systems”, (e.g., Lund et al., 2017; Bačeković and Østergaard, 2018; Haitao et al., 2018; Office of Gas and Electricity Markets (Ofgem) 2017; Connolly et al., 2016), and “local energy systems” (e.g.,Office of Gas and Electricity Markets (Ofgem), 2017). This work is drawn on in the current study. While much has also been written about energy systems in general, and particular concepts relating to energy systems (e.g. decarbonisation goals, decentralised energy, community energy, energy democracy and governance, digitalisation and smartness), no work was identified in the current study that explored how these concepts come together to deliver a SLES. Only by exploring the mental and more formal theoretical models by which a smart local energy system transition is conceptualised, can an understanding be formed around how such systems might deliver intended benefits, how they might need to be governed, and what implications this may have for energy sector stakeholders.

Section snippets

Socio-technical energy transitions

Socio-technical transitions are multi-dimensional processes involving co-evolutionary interactions between technologies, supply chains, infrastructures, firms, markets, user practices, cultural meanings, and institutions (Geels, 2002, 2004). Socio-technical transitions in energy are typically purposive in nature (rather than emerging from opportunistic niche developments), responding to climate change goals and/or delivering wider technical, social, economic, environmental and political

Methods

This study combined a systematic meta-narrative review of conceptualisations of ‘smart’ and ‘local’ in the context of energy systems, with expert interviews from a multidisciplinary group of researchers, allowing for direct elicitation of these concepts. This section describes the aims and focus of these two approaches and outlines how findings have been combined.

Findings

Fifty-one relevant sources of information were included; 13 interview transcripts (labelled INT1 to INT13) and 38 sources from the literature review; see references (Lund et al., 2017; Bačeković and Østergaard, 2018; Haitao et al., 2018; Alanne and Saari, 2006; Ding, 2021; Hvelplund et al., 2011a; Devine-Wright and Wiersma, 2013; Julian, 2021; Murphy, 2021; Albino et al., 2015; Hargreaves et al., 2015; Frame et al., 2016; Dong et al., 2017; Flett and Systems, 2018; Jones et al., 2017; Neves and

Discussion

In this paper we have examined how socio-technical regimes associated with smart local energy systems are conceptualised, and explored how they interact with wider pressures to deliver value not realised (or not maximised) by incumbent arrangements. In this section we discussion four key contributions of the paper: defining the key characteristics of smart local energy regimes; exploring relationships between landscape and local pressures; linking regime processes to desired outcomes; and the

Conclusions

While SLES are expected to deliver a wide range of benefits, a number of issues need further exploration to ensure SLES contribute to a socially just, economically prosperous, and environmentally sound transition to net-zero. The following paragraphs outline the managerial and policy implications for delivering SLES, the limitations of the current study, and opportunities for further research.

Funding sources

This work was supported by UK Research and Innovation Grant No EP/S031863/1 “Energy Revolution Research Consortium - Core – EnergyREV”, administered by the Engineering and Physical Sciences Research Council (EPSRC).

CRediT authorship contribution statement

Rebecca Ford: Conceptualization, Methodology, Formal analysis, Investigation, Writing - original draft, Visualization, Funding acquisition. Chris Maidment: Formal analysis, Investigation, Data curation, Writing - original draft. Carol Vigurs: Methodology, Formal analysis, Investigation, Data curation, Writing - original draft. Michael J. Fell: Conceptualization, Methodology, Writing - original draft, Visualization. Madeleine Morris: Investigation, Writing - review & editing.

Rebecca Ford is a Chancellor's Fellow in the Departments of Government & Public Policy, and Electronic & Electrical Engineering at the University of Strathclyde. She is a multidisciplinary scholar who believes in the importance of research for impact, and in bridging the gap between different forms of knowledge to advance solutions tackling climate change. Her research explores how people interact with energy systems, and how social, environmental, and technological insights can be co-developed

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    Rebecca Ford is a Chancellor's Fellow in the Departments of Government & Public Policy, and Electronic & Electrical Engineering at the University of Strathclyde. She is a multidisciplinary scholar who believes in the importance of research for impact, and in bridging the gap between different forms of knowledge to advance solutions tackling climate change. Her research explores how people interact with energy systems, and how social, environmental, and technological insights can be co-developed to better inform policy for sustainable development.

    Chris Maidment is a researcher and systematic reviewer in the UCL Energy Institute. He has an interest in the social and environmental impacts of energy efficiency and renewable energy technologies. His research includes meta-analyses, surveys and interviews, and he has experience of evidence use in policymaking from prior roles in academia and local government.

    Carol Vigursis a researcher in the UCL Institute of Education. In addition to energy, her research interests include diabetes education, children and young people, young offenders, and youth at risk. Carol has extensive experience in conducting systematic reviews and rapid evidence assessment, and she brings a wealth of expertise, more commonly found in the medical sciences, to the energy transitions domain.

    Michael Fell is a senior research fellow at UCL Energy Institute. He does social research on domestic energy demand, with particular focus on uptake and impacts of demand-side response products/services and demand flexibility. He is currently working on projects relating to blockchain-enabled energy retail markets, and smart local energy systems.

    Madeleine Morrisis a Research Associate based at Imperial College London in the Grantham Institute for Climate Change and the Environment. She works within the Energy Revolution Research Consortium on the policy, regulation and innovation frameworks that will support smart, low-carbon energy systems. Her previous research looked at new materials for solar energy conversion.

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