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How to power smart cities in a clean, low-carbon future

Microgrids transform urban energy into localised, efficient, resilient and sustainable systems, and investment in them will be critical to the future operation of the energy system, says Ian Lloyd, Strategic Growth Manager, Siemens.


According to McKinsey, global electricity demand is set to double by 2050. Soaring demand is changing the way our energy is being delivered.


As cities shift from fossil fuel usage towards smarter energy networks, an array of breakthrough technologies is emerging to help power an energy market that not only addresses environmental concerns but also makes renewable energy more cost-competitive.


The energy transition


Cities are huge consumers of power, using up two-thirds of the world’s energy and producing a similar proportion of global carbon emissions. Modern city authorities, planners and utilities need to discover new ways of developing the electrical infrastructure, which supports economic growth and quality-of-life while lessening the impact on the environment.


As urban hubs look to redefine the energy mix and distribution systems, the energy system has been evolving. It is transitioning from a centralised model of power generation to a more diverse network comprising multiple sources of power, mixing the conventional grid with renewable modes of generation to create more efficient, resilient and sustainable energy systems known as microgrids.


Microgrids contain all the elements of a complex energy system, maintaining the balance between generation and consumption. Critically, they can operate on and/or off-grid, storing excess energy for later use, balancing out supply and demand.


As urban hubs look to redefine the energy mix and distribution systems the energy system has been evolving.


These intelligent energy systems are ideal for supplying power to remote regions or locations and have also made a marked difference for the decentralised generation and storage of electricity in buildings, campuses, hospitals, ports and local government estates.


A wide range of energy sources are being leveraged, from photovoltaic and wind-power plants to hydro-power and biomass-power plants. Electric vehicle (EV) batteries also form part of the centralised future. Intelligent control systems coordinate the energy sources, many in conjunction with biodiesel generators, emergency power units and storage modules, to guarantee the supply of power.


Smart cities will use real-time data and communication to efficiently manage assets and resources of the microgrids with sophisticated software controls optimising power usage on demand, selecting advantageous utility prices, feeding excess power back into the grid and many other operations, all while ensuring the safe operation of the network.


Manchester microgrid project


The city of Manchester has been participating in the five-year-long European Commission (EC) sustainable cities project, Triangulum. As part of the initiative, Manchester City Council, Manchester University (UoM), Manchester Metropolitan University (MMU) and Siemens assessed energy consumption, ways of cutting costs and emissions and how to boost renewable energy sources in Manchester’s Oxford Road Corridor.


Over the course of the project, microgrid systems were deployed to optimise energy consumption in that section of the city. At MMU’s Birley campus, a 400kWh lithium-ion battery has been installed to integrate with the rooftop solar panels at the site.


A microgrid controller selects the best energy source to use between the pre-existing combined heat power (CHP), solar panels and the battery to supply power to 900 student rooms and a large academic building. The battery will store energy and help stabilise any variation in power loads, storing or releasing energy as and when required.


Microgrid systems were deployed to optimise energy consumption in a section of the city.


A cloud-based energy management platform served as a virtual power plant for three sites around the city, optimising energy at the Central Library, Manchester City Council’s town hall extension and three other buildings at the UoM. The controller integrated with the BMS systems and switched non-critical assets like heating and cooling on and off in response to demands on the grid to maximise energy efficiency, compensating for different weather conditions or changing populations in any of the buildings.


The solution optimised energy consumption, reduced CO2 and lessened the area’s dependence on the grid. Scaled citywide, the central controller could potentially save Manchester approximately 57,000t CO2 emissions per annum which is the equivalent of taking 12,000 cars off the road each year.


Espoo smart energy


At Finland’s second-largest shopping centre, Sello in Espoo, another smart energy system has taken shape. A smart power microgrid has been built at the shopping complex and is connected to the broader energy system. A storage battery system constructed within the premises enabled smart electricity storage and usage, and is designed to reduce the country’s need to invest in back-up power plants as well help the grid to secure its energy production.


In tandem, a 500kWp solar energy system stored any excess solar energy in the battery. Sello’s microgrid combines energy efficiency, storage, optimisation of peak loads, and its own electricity production balancing generation and consumption in real-time.


The centre has saved €125,000 on its annual heat and electricity costs and reduced its CO2 emissions by 271 tonnes. In addition, it has also been able to supply its surplus energy to the reserve market giving an annual income of around €480,000 annually.


The shopping centre has saved €125,000 on its annual heat and electricity costs and reduced its CO2 emissions by 271 tonnes.


Microgrids are part of an interlinked energy future that focuses on decentralisation, decarbonisation and digitalisation. Decentralisation means we are moving away from the grid.


Renewable sources allow energy to be generated locally within microgrids, that are now able to supplement national grid systems and flexibility needs.


Decarbonisation is about the commitment from the energy industry to reduce CO2 emissions. By using primarily renewable alternatives, microgrids can contribute significantly to reduce emissions. Digitalisation is about harnessing the power of useful data, often connecting everything of value together.


Technology and sophisticated secure IT systems balance the energy sources, providing 24/7 power, to ensure a consistent and secure power supply at least cost, least carbon or the best mix of either. Extracting the most value from data will help operational efficiencies and identify structural improvements.


Repeatable and scalable projects


The pilots at Manchester and Espoo have proven low-carbon, cost-efficient smart cities are achievable, repeatable and scalable. While these demonstration projects are great proof-of-concepts, initiatives will need to be scaled-up across cities and regions to make any meaningful impact on decarbonisation or to meet carbon neutrality targets.


Cities have tended to turn to the public sector to fund these kinds of projects but there is a growing realisation that civic budgets are falling short of providing adequate funds. Public-private partnerships and performance contracting are encouraging greater collaboration and are necessary if global decarbonisation targets are to be met.


Microgrid investment will be critical to the future operation of the energy system if we are to manage local energy sources while balancing the grid.



The benefits of investing outweigh the costs. Microgrid investment will be critical to the future operation of the energy system if we are to manage local energy sources while balancing the grid and avoiding dropouts when demand soars.


Ultimately, investment will improve a city’s standing, competitiveness and sustainability creating environments that care.


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