Are friends electric?

Project conducts smart grid trials exploring the challenges of an energy transition whilst bringing social, economic and environmental benefits for all.

Through the lockdown period I have been leafing through my old vinyl record collection. It has provoked me to ask, when it comes to the Local Energy Oxfordshire project (LEO), in the words of Gary Numan “are friends electric?”

Project LEO is a demonstration project, co-funded by UK Research and Innovation under its ‘Prospering from the Energy Revolution’ programme.

Trendy friends

The energy system is in transition and our technological friends are, probably, electric. Progressive decarbonisation of electricity supply means the more energy services can be delivered with electricity, including travel and heat, the better the chances of meeting net zero commitments.

Broad techno-economic trends are helpful. Large scale solar and onshore wind are the cheapest forms of generation, whilst the cost of rooftop solar has halved over the last decade and will continue to drop in price. Similarly, steep declines in the cost of batteries mean that electric vehicles are forecast to be cheaper than fossil alternatives in the next five years, creating a tipping point in the car industry.

Credit: LEO

The carbon case for the heat pump, is likewise open and shut, even at current grid carbon intensities heat pumps offer at least 30% reductions in emissions over conventional gas boilers. Some of these technologies remain more expensive than incumbent alternatives for the moment. But of course, the more of this low carbon technology is installed, the cheaper it gets, which means more is installed and the cheaper it gets…

Needy friends

These trends in the way we generate, distribute, store and consume energy combined with net zero carbon targets, create a complex energy challenge. And, just like a house party where too many friends turn up, things can get out of hand.

The electricity distribution network was not engineered to accommodate thousands of new sources of electrical generation connected at the low voltage level. Huge increases in electricity demand from electrified heat and transport systems connected at the grid edge will also create network constraints and capacity issues, particularly at peak times.

Network operators can either re-engineer the network at, potentially, eyewatering cost or find new ways of getting the most out of the existing network. By, for example, creating a market for energy consumers or producers to be rewarded for being flexible with their power demand or generation or, a bit of both.


There are also wider societal and environmental issues that arise from creation of millions of batteries, magnets, photovoltaic cells and other key components of the transitioned low carbon electricity infrastructure.

For example, 500,000 gallons of water are needed to extract one tonne of lithium (enough for 50 EV car batteries). Whilst, most of the world’s cobalt supply, also essential for current methods of battery production, comes from the Democratic Republic of Congo where it is mined with little regard for human rights and safety.

The mining of rare earth metals required for magnets creates huge issues with toxic waste. Some friends need to change their ways.

The energy transition party

Project LEO is exploring how these technological and economic trends can be harnessed to deliver benefits to local economies, to communities and to the environment whilst simultaneously maintaining a safe, reliable network.

Through learning by doing, LEO is building an evidence base of the technological, market and social conditions required for a greener, more flexible and equitable electricity system:

  • technological: what are the required capabilities of renewable, storage and demand response technologies needed to create flexible energy services?
  • markets: what do local energy services look like and what are the IT systems and market platforms where these services can be traded?
  • people: how do we facilitate local participation in the electricity system at all levels and how do we ensure the barriers to participation are as low as possible and that the system as a whole shares the benefits of the energy transition fairly?

Smart friends

LEO is testing a range of assets to explore what kind of flexible power services they can provide, including:

  • community hydro generation
  • community scale and domestic scale batteries
  • rooftop and ground mount solar PV
  • electric vehicle-to-grid technology
  • demand side response from HVAC equipment in large non-domestic buildings and from batteries and smartened household equipment (for example, heat pumps, storage heaters) right at the grid edge.

Credit: LEO

We are also developing and testing the IT and data systems needed to:

  • monitor the network at low voltage level
  • forecast and map where constraints will appear
  • procure, contract, dispatch, verify and settle network services.

Local energy systems must be smart and automated wherever possible. Otherwise, transaction costs destroy business models, services will not be reliably delivered, and the control and monitoring systems cannot function.

And the data to do all this must be easily accessible, granular and presented in intelligible formats otherwise:

  • innovation is stifled
  • business models cannot be developed
  • decision making is thwarted.

Much valued friends

LEO is led by a distribution network operator (DNO), SSEN, that needs to understand how to forecast and procure flexibility services that meet its operational needs through market mechanisms. Needs can be instantaneous in the case of managing a fault or, in the case of managing peak demand, procured a day, a week or months ahead.

Key to this is understanding the value of flexibility in particular parts of the network at particular times. Value will be determined by the type of network constraint and the cost of the alternative to flexibility, for example, reinforcement.

Alongside the DNO services, LEO is also testing market arrangements for some distribution system operator (DSO) services, including trades of power capacity between peers and, in the future, we could also explore unit energy trades.

Fair friends

The principle at the heart of a local energy approach is that local issues require local solutions, balancing supply and demand at the primary or secondary substation levels.

Therefore, by definition, network users (everybody), should be empowered to participate in the local energy system in some way (for example, modifying their demand profile), and be rewarded for doing so. Otherwise the network constraint is not easily tackled.

LEO is not just about solving electricity distribution issues. SLES are also about the creation of social and economic benefit at the local level. However, not everyone has technical, digital, personal or social capability to participate in SLES or to benefit from it. This is a problem both operationally and ethically.

Consequently, a further guiding principle for LEO is that SLES are only successful if access to benefits is equitable. Also, if a householder or a business doesn’t have the requisite capabilities to participate in a SLES, consideration will be given to how capability can either be increased, whether the offer can be adjusted to match capability or whether benefit can flow indirectly through other channels.

We are testing these ideas through the creation of five ‘smart and fair’ neighbourhoods across Oxfordshire, at which we are working with local communities to identify their needs. We are then co-developing local energy systems which help meet those needs.

…and new friends

Now into its third year, project LEO is beginning to dig into the detail of the ways in which technical, economic and social systems can be fused to deliver a fairer, more efficient, more resilient energy system.

The complexity of the energy system means it’s very easy to get things wrong and our learning by doing approach means we understand and embrace that.

However, there’s a strong belief shared across the project that the guiding principles are sound and that ultimately LEO will deliver good evidence for systems which are sustainable, replicable and fair.

So, friends are electric, but some need to change their ways, some need to be reintroduced and we can be sure that new friends are just around the corner.

Further information

Project LEO benefits from having a diverse set of partners:

  • distribution network company, SSEN
  • community energy organisation, the Low Carbon Hub
  • local authorities, Oxford City Council and Oxfordshire County Councils
  • research organisation and owner of large flexibility assets, the University of Oxford, Oxford Brookes University
  • vehicle to grid specialist and aggregator, Nuvve
  • market platform developer, Piclo
  • energy supplier, EDF Energy
  • flexibility services consultant, Origami.

This collaboration gives LEO a great opportunity to explore the potential of a smart local energy system from the perspective of most of the principal types of actor involved.

Top image:  Credit: LEO

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