On the pathway to a more electrified future, all of us as consumers, need to take real steps towards decarbonizing our way of life. Take, for example, two game changers that are already making their way into our lives: electric vehicles and heat pumps.
Electric vehicles are not only more efficient in terms of taking you further with the same amount of energy but, by electrifying consumption with power generated by renewables, we can decarbonize our everyday journeys in an effective way. Similarly, heat pumps help us heat our homes more easily and efficiently by using green electricity instead of gas: they are a real game changer, especially in this complex moment for the gas market and its geopolitical complexity.
Many detractors of renewable energy point out that electrical grids cannot accommodate a sudden surge of decentralized or utility-scale clean energy. In actual fact, Enel’s grids already host a massive volume of distributed Renewable Energy Sources and, in 2021, they reached the milestone of one million connected prosumers, representing a collective installed capacity of 57 GW. Given the current context and its high energy prices, this phenomenon is growing significantly, not just for Enel but for all distribution grid operators.
The combination of increased electrification and decentralized renewable generation is helping to drive the grid investments needed to make our infrastructure more robust, sustainable and open to the participation of different stakeholders. At the same time, through digitalization, grids need to be able to dispatch bidirectional flows of electricity as this is a fundamental requirement for hosting higher volumes of renewables and becoming more flexible in order to meet increasingly variable energy needs.
Grid modernization is needed to pave the way for green electrification
At Enel, we are frontrunners in the modernization of power grids, starting with the rollout of the first smart meter in Italy in the early 2000s: today the country has one of the most modern and digitalized electric infrastructures in the world. We have also used our expertise to pioneer a roadmap called Grid Futurability, which takes into account the need to transform traditional distribution networks into Smart Grids, combining the use of robust infrastructure with advanced digital solutions that make electricity grids more resilient, participatory and sustainable.
In the current scenario, it becomes clear that investments in electricity distribution networks are crucial to accelerating the energy transition towards a net-zero future. All our investments in distribution grids will focus on this vision, reaching around 70 billion euros by 2030. This will enable us to make better use of and revitalize legacy infrastructure but also to build fully digital smart grids that are capable of hosting higher volumes of renewables, by activating local flexibility services and leveraging distributed energy resources.
Seamless electrification will be made possible thanks to adequate and future-proof infrastructure all over the world. For this reason, we are working with our peers and the supply chain to ensure robust and reliable power grids that can withstand extreme weather conditions. Furthermore, they should host a greater number of distributed renewable connections and respond to new forms of energy demand in the construction, transportation, and industry segments, with high variability and high-power rating. We are also making our grid components and materials sustainable by design, reducing their impact on the planet, by safeguarding biodiversity and the security of populations.
Empowering grid customers to embrace net-zero
As the recent Ember’s Global Electricity Review 2022 report showed, global electricity demand in 2021 rose 5.4%, in practical terms, adding the equivalent of India’s annual power demand. Levels of electrical energy distributed by Enel’s grids in 2021 (across eight geographical regions, representing both developed and developing countries, as well as rural and urban areas) have also shown a return to pre-pandemic volumes as a result of the uptake of electrification and recovery in economic activities. Customers’ everyday choices should compel us to speed up investments in digital smart grids, which are vital for promoting more active participation by all stakeholders in the electrification of the world’s economies.
These choices will only be fully effective if customers can rely on an infrastructure that is intrinsically sustainable, and not just “green” because it carries renewable electrons. Enel has therefore embraced the principles of circularity-by-design in its processes and technologies, making them mandatory requirements in the supply of critical components for the distribution network, such as transformers, panels, switches and cables.
We have also adopted a grid mining approach, which entails the recovery of valuable materials from obsolete grid infrastructure and devices with a view to minimizing the environmental impact and the consumption of resources. Our circularity-by-design approach aims to create a circular value chain. Take, for example, Enel’s “Circular smart meter,” which is produced with 100% regenerated plastic from old meters: it is being given a rapid rollout all over Italy and in the other countries where we operate.
This smart meter technology has also helped make grids fit for prosumerism and electric mobility, helping us speed up the customers’ journey to an electrified future. Enel is targeting a total grid customer base of approximately 86 million by 2030, and it will be entirely served by smart meters.
Digitalization is also enabling us to open our grids so that new actors, such as charging point operators and aggregators, can become part of the energy ecosystem by offering new services. In 2021 alone, we connected nearly 4,000 new public charging points to our grids in Italy and Spain, while working every day with more than 600 retailers serving over 75 million grid customers worldwide.
Pushing ahead for digital power grids: Gridspertise
Power grid technologies need to be re-engineered for our sustainable electric future. We are deploying much of the technologies in our grids, but we can only have a limited impact globally in the transition to net zero at a global level if this journey isn’t supported by other grid operators. At Enel, we believe that only with an open collaborative approach between energy companies, manufacturers, institutions, regulators, and final customers will it be possible to reach the net-zero targets.
For this reason, we created Gridspertise, a company that’s fully dedicated to sharing knowledge with the outside world. It offers innovative, flexible, sustainable, and integrated solutions and services to Distribution System Operators (DSOs) worldwide, and intends to act as a reliable partner to give impetus to the digital transformation of the electricity grids within the framework of the energy transition. Gridspertise, which was set up in September 2021, recently announced thirteen agreements for more than 670,000 smart meters and over 150,000 field devices and accessories in four European countries, as well as services for the digitalization of customers. And on the occasion of “Net Zero Grid Day,” a special event organized by Enel on May 16, Gridspertise also announced its intention to expand its operations in the United States, where it plans to support infrastructure modernization efforts.
Working together: the Open Power Grids Association
As announced during the last Capital Markets Day, Enel has brought forward its full decarbonization target by ten years, from 2050 to 2040, considering both direct and indirect emissions. Grids are the fundamental platform for enabling green electrification and the whole transition towards global decarbonization, but decarbonization of the power grid itself is equally crucial. This is the first contribution of power networks for the Group’s net zero goal. This can be achieved by focusing on lowering the CO2 footprint from operations, reducing network losses and adopting circular and low emissions materials and components.
A net-zero grid is an ambitious target, and Enel cannot reach it alone: it needs to work alongside other network and grid operators around the world that are facing similar challenges. And that is why, following our open and collaborative approach, we have launched the Open Power Grids Association, which will bring together network operators, manufacturers, research institutes and other stakeholders to share and develop technology in order to improve the standards of grid components in terms of efficiency, safety, quality and sustainability, in compliance with net-zero requirements. Expressions of interest by potential members can be submitted directly to openpowergrids@enel.com.
We believe that our net-zero ambition for grids represents the first move by a global power grid player to address upstream and downstream infrastructure emissions in an open way. We have already done a lot to identify the best technical solutions for our grids, but if we want to move forward quickly, we need to share this challenge with other actors in an open and collaborative environment.
We can go faster towards a brighter and more sustainable future if we move together.