Ergon’s Energy Sense Community – the sum of its parts
Ergon’s Energy Sense Community – the sum of its parts
When it ended late in 2014 Ergon’s Energy Sense and Community program was already influencing the Queensland utility’s approach to planning and augmenting its network. In this article Ergon Energy Network Strategy and Policy Engineer Don McPhail shares the insights and outcomes of the program - a challenging and successful initiative that used good governance, teamwork, and program management to maximise the results flowing from myriad ground-breaking trials.
Ergon’s Energy Sense Communities (ESC) project was an integrated program of 34 initiatives all aimed at deferring capital investment, trialling alternative energy solutions, and better managing electricity demand in regional Queensland.
The project was based in Townsville and ran from 2011 to mid-2014.
In a nutshell; ESC delivered what it set out to do 12 months early and under budget to the tune of 53 per cent. It was able to achieve an 11.4MVA reduction in peak demand which was required in order to defer the construction of two new zone substations, and it saw the deployment of smart systems to facilitate dynamic network rating, switching, and fault detection, isolation and restoration.
In addition to the capital works deferral and deployment of integrated smart network systems, the ESC project has seen the creation of new business and engagement models, customer-side technology strategies, design and connection standards, and planning tools.
The unprecedented change facing Ergon, and the electricity industry as a whole for that matter, has been a driver of ESC. We are experiencing rapid technological advances, including smart grid technologies, which are providing increased efficiency in cost and operations of electricity distribution. This is sparking new consumer trends and making much of the traditional utility approach to electricity distribution outdated or increasingly at odds with customers’ expectations.
Regional Queensland has a strong customer adoption of distributed energy resources, with 16 per cent of customers having a grid-connected Solar Photovoltaic system (PV). New technologies like this are changing customer and network demand profiles.
This environment has driven Ergon Energy, like many modern utilities, to move towards smarter network systems, and smarter customer and business engagement models to manage peak demand and improve utilisation, while maintaining network reliability and safety.
Townsville, with a population of approximately 190,000 and a diverse economy, was chosen for the program because it best represents Ergon’s wider service area. Due to significant commercial and residential growth in the north-west parts of the city over the past ten years, modelling also showed a potential demand for two additional zone substations by 2018 – unless, of course, peak demand growth could be curtailed.
The Energy Sense Community program
At a high-level the program was established under a Joint smart grid platform with fellow Queensland electricity distributor Energex, to provide executive oversight and facilitate effective knowledge sharing. At a functional level, ESC was integrated under a program management office (PMO) charged with program management and governance, marketing, communications and engagement, and knowledge management.
The program was broken into three management streams - Smart Residential, Smart Business, and Smart Network. The three streams were supported by a knowledge management framework that captured, stored and shared program insights. Having this framework ensured all our initiatives leveraged developments from global industry, and effectively kept the business-as-usual processes informed.
The program also incorporated a number of key community and industry partners, including Energex, Stockland North Shore and the Electrical Power Research Institute (EPRI).
The Smart Network stream involved 12 initiatives and used pilot trials on network solutions, maximising capacity and utilisation while moderating demand, and optimising smart systems and devices. For instance, the integration of dynamic ratings, dynamic switching and harmonisation of controllable loads systems into the control room allowed us to more effectively manage our utilisation and switch loads between industrial and residential feeders on different substations and therefore achieve a 34MW reduction in demand overall, which contributed significantly to the success of the program as well as to the overall annual Ergon Energy Demand Management target.
Nine initiatives in the Smart Business stream investigated demand management for commercial and industrial customers located at greenfield and brownfield sites within ESC zone. The third ESC stream focussed on the Smart Residential category and involved another dozen initiatives which looked at energy conservation and demand management, emerging technologies and stakeholder engagement.
The successful pilots in the business and residential streams examined emerging technologies such as electric vehicles, battery storage and solar photovoltaics. Energy efficiency measures trialled at new and existing housing developments in the study area resulted in improved energy affordability and reduced demand at peak times. The insights are now helping Ergon’s strategic planning, processes and product development. One of the notable outcomes in the smart business and smart residential streams has been the formation of a Trade Ally Network (TAN). Customers seeking to reduce demand and become more efficient electricity users have the potential to access Ergon incentives via the listed members of TAN. The network has expanded to Mackay and is expected to roll out further afield.
What we learned
Some of the insights we gained were expected and others weren’t, however all have provided valuable lessons to the business. One of the major outcomes of the program was increased availability of substantial network and customer data associated with the initiatives, as well as improved systems of working.
Twenty-two initiatives were completed, three remain in long-term measuring and verification phase, and five closed out early - due to either progressing to larger scale roll-out or due to detailed feasibility studies showing their unsuitability for either the Townsville site or Ergon Energy’s application.
Overall, we learned a great deal from ESC which isn’t surprising given the scope and scale of the program. We know that knowledge management has to be embedded into the culture of an organisation with ongoing support and leadership from upper and middle management. It’s also essential that any prior research is captured at the start of the program and used to inform the scoping of projects and the business. There also has to be balance struck between structure and flexibility so that knowledge management is not perceived to be a burden.
In terms of measurement and verification, we learned that a robust strategy and plan is required from the start, and exit triggers and strategies should also be identified and developed during scoping in order to ensure a project is closed out smoothly. Our approach to combine the 34 initiatives under a single PMO and governance structure provided superior visibility which provided better risk management and contributed to the under-budget delivery of the program.
One other final valuable learning from the network initiatives was that an unsuccessful outcome can still yield valuable insights, particularly where it proves/disproves a hypothesis, even if this was an unexpected result.
The success of ESC has changed the way Ergon Energy plans, builds and manages its network. The program has also played a role in reducing upward pressure on electricity prices by deferring capital investment on the network. These outcomes three-and-a-half years after ESC launched are testament to a planned approach, project management, good governance and teamwork.
Ergon Energy’s Energy Sense Communities was also shortlisted for the 2014 Queensland Premier’s Award for Excellence and Engineers Australia 2013 Townsville Engineering Excellence Award. The Electrical Power Research Institute (EPRI) recognised the program’s knowledge sharing expertise with an award in 2015.
Our findings from the program have supported Ergon Energy’s Australian Energy Regulator submission for 2015-2020, and associated business cases, with improved measurement, analysis and targeted research. We exceeded our demand reduction targets to the tune of $31 million by deferring the construction of two zone substations.
About Ergon Energy
- Ergon Energy is a state government-owned corporation responsible for distribution of electricity to 97% of Queensland and the Torres Strait, Australia.
- The large supply region – more than one-million square kilometres – has just around 720,000 customers which also makes it one of the lowest density networks in the country.
Ergon’s Energy Sense Communities fast facts
- Smart Grid program spanning 3.5 years trialling techniques to defer planned network investments.
- Thirty-four initiatives in Townsville with a combined focus on network and customers.
- Delivered ahead of time, to scope and significantly under budget.
- Successful integration of key insights and outcomes from the program and its initiatives into Ergon’s business.
- Trial the use of smart asset management techniques and technologies to defer planned network investments
- Undertake necessary research to support subsequent business cases, and
- Change the way the organisation plans, builds and manages the network through an integrated set of initiatives coordinated as a program in a single catchment area, to facilitate alternative ways to manage demand growth along with improving network utilisation, while improving the economic outcome for customers and the shareholder.