Project Summary

In 2019, the Welsh Government set ambitious targets to meet 70% of its electricity requirements from Welsh renewable energy sources by 2030 and has set binding climate targets that align with UK Government's commitments to a 78% reduction in carbon emissions by 2035.

Despite Wales' significant renewable energy opportunities, considerable planning and co-ordination challenges across multiple stakeholders is preventing the acceleration of renewable energy adoption in a sustainable way.

To resolve these challenges, the project will take a whole electricity system approach to deliver an innovative digital twin of the network (the first to include both transmission and distribution in Wales). The Welsh Government and network operators will work together and identify priorities for progressing Wales' world-leading decarbonisation plans, increasing renewable electricity hosting capacity and delivering net benefits to Wales' citizens and communities.

ESO and Welsh Government will partner to ensure an adequate and accelerated response to Net-zero goals/ challenges. Network partners (NGET, NGED) will provide subject matter expertise, ensuring a whole electricity system approach. CGI will be responsible for developing intelligent modelling solutions.

The Digital twin will utilise detailed electricity system models to:

• Provide complete visibility of current network status, enabling transmission and distribution coordination opportunities for Wales
• Deliver a connections and capacity management tool, enabling a better understanding of the bi-directional whole system relationship between reinforcement options and type of low carbon technology solutions.
• Deliver flexibility markets coordination interface, optimising network operators' flexibility requirements across multiple trading platforms and response providers, thereby reducing consumers' costs.
• Facilitate new distributed energy resource site identification and connection, and enable constraint coordination across networks, allowing Welsh Government to set priorities, support net zero progress and enable network change through stakeholder collaboration.
• Address local needs by enabling home-produced, low-cost renewable electricity generation.

Powering Wales Renewably addresses Innovation Challenge 2: Preparing for a net zero power system:

• Establishing Wales' first whole electricity system model, enabling Wales to reach its full Renewable Energy (RE) potential and reduce carbon emissions.
• Accessing novel system support by enabling flexibility coordination across the whole electricity system, reducing RE curtailment and facilitating constraint management.
• Enabling electricity system integration through additional connections, increased outputs, and access for flexibility services.

Currently, only separate pieces of the jigsaw are available; this common representation of the whole electricity network will complete the puzzle to enable local and regional policy makers, investors and community leaders to work with network operators to deliver net zero.

Innovation Justification

Whole electricity system coordination is required to ensure networks optimally enable the Welsh Government's strategic energy transition plans. Specifically, innovation is needed to provide a basis for stakeholder whole electricity system collaboration to enable priorities to be established, flexibility co-ordination, and how constraints and connections are optimised.

The Welsh Government will provide the project's strategic direction focusing on meeting local needs and customer benefits. Coordination of data, flexibility and constraint management will be addressed. Addressing slowed economic development, customer connection queues and impeded uptake for renewables and ensuring connections of off-shore renewables benefit the local needs.

The project is radical in its ambition, delivering:

• A national foundation representation of the whole electricity system to enable, collaboration and prioritisation.
• Paradigm shift in user defined T&D data exchange, stimulating additional innovation opportunities.
• An holistic approach by which constraints and flexibility requirements can be coordinated across Network Operators, multiple markets, and response providers.
• Connections and Capacity Management; visibility, of upstream reinforcement, and the relationship with alternative local non-reinforcement technology options.

Key risks are: technical challenges in establishing a detailed federated model across multiple network operators, and achieving consensus across stakeholders.

We are building a detailed national model (first for Wales) of a combined Transmission and Distribution systems. By leveraging open data and federating to existing BAU intelligent models, we are pioneering the application of whole electricity system engineering. It is recognised that data is being more open, but not always aligned to a customer need. Industry forums are working on setting frameworks, but this project will instantiate a national foundation to release the customer value of open data. We will utilise learnings from previous demonstrators, and drive the change needed to reach Net Zero.

In answers to Question 5 and 6 we quantify the following benefits:

Value

• Distribution Network Capacity -- £4.65M in ED2
• Hydrocarbon displacement effect on Customer Energy Bills - £7.6m per annum
• Renewable Generation curtailment - £28.2M per annum for GB

Sustainability

• CO₂ reduction -- 66,960 tons of CO₂ per annum

The project addresses the "Preparing for a net zero power system" challenge. Given the urgency and innovation required to achieve Net-Zero goals, SIF is the most appropriate funding route for this project due to its scale, complexity, risk and need for a collaborative approach. The net zero challenge is driving change of such scale, that the project's key mission is to accelerate multi-party collaboration well beyond current arrangements.

Project Benefits

At Discovery submission stage, we will establish confirmed benefits and associated metrics through:

• A collaborative approach defining priorities and plans for Welsh Government and other partners
• Refining processes using advanced digital technologies
• Establish the key areas where the project will make an impact and agree how these can be attributed and captured

A subset of the key candidate benefits identified at this stage are described in this section, further detail and evidence will be developed throughout the project:

• Financial - future reductions in the cost of operating the network
• Secure greater output energy volumes from existing DER where possible through reduced curtailment (£/MWh). Reduced curtailment by at least 10%, saving GB £28.2m per annum, (2020 data, Imperial College London).
• Financial - cost savings per annum on energy bills for consumers
  Energy price reduction between gas generation costs and renewables. Based upon 19TWh per annum electricity consumption of Wales, if just 1% (190GWh) of gas fired generation were displaced by renewables, then an overall saving of £7.6M would be achieved. This assumes a historical 4p/kWh generation cost saving. In the current environment that saving could be significantly greater. The metric would be £ saved per household.
• Financial - cost savings per annum for users of network services
• The project is targeted to improve network capacity utilisation. Based upon ED2 proposed Primary Reinforcement costs alone, of £49m in South Wales and £44m for SPM, if a 5% improvement of utilisation were achieved this could equate to a saving of at least £4.65m over that review period. This figure does not include any benefits that would be realised at the Transmission level.
• Environmental - carbon reduction -- direct CO*₂* savings per annum against a business-as-usual counterfactual
• Reducing connection queues, increases the fossil fuel displacement by renewables. Based upon 18TWh per annum of gas generation of Wales, if just 1% (180GWh) of that generation were displaced by renewables, then a CO₂ saving of 66,960 tons would be realised.
• New to market -- products, processes, and services
• 1 gigawatt (GW) of Welsh owned renewable energy capacity in Wales to be locally owned by 2030. The proposed metric would be Megawatt capacity owned.

We would expect to start tracking benefits against an agreed baseline early in the project (Alpha and Beta) and increase granularity as the project matures and is embedded into BaU.