During a two-day training held online on 27 and 28 October, MEDREG introduced its members to the challenges that digitalisation will bring to the drafting of regulations for this new technological era. The workshop, actively followed by 63 staff members from regulatory authorities, addressed four main concepts: flexibility, open data platforms, data usage and cybersecurity, and the growing role of consumers in shaping energy markets.
The discussions were animated by contributors from public institutions, regulators, research centres, and the private sector - all renowned experts in the field of digitalisation.
The training demonstrated the key role of digitalisation to foster decarbonisation and incorporate renewable to the energy systems, and it presented the challenges and solutions that digitalisation will bring to the regulators.
Speakers stressed the interlinked role of digitalisation, infrastructure, and services. All agreed that digitalisation is an enabling factor to satisfy energy demand and maintain reasonable costs through the aggregation of different kind of services. However, they warned about the complexity of the system which entails potential risks concerning cyber security.
Diving deeper into the subject, lecturers talked about submarine optical cable systems as key enablers and critical infrastructure for the global digitalisation transformation. They highlighted the existing wide opportunities to cooperate and synergize between telecom backbone and energy infrastructure project. Telecommunication and Internet companies are indeed heavily investing in new submarine and terrestrial backbones. The Mediterranean basin can be the ideal playground to test this enhanced cooperation.
Innovation, smart meters and flexibility of services are also central in digitalised markets, noted the trainers. We are currently witnessing emerging innovations for the integration of renewable energy. Digital technologies can support integration of RES through faster response, better management of assets, connecting devices, collecting and sharing data.
Blockchain is enabling a new world of decentralised communication and co-ordination, by building the infrastructure to allow peers to safely, cheaply and quickly connect with each other without a centralised intermediary.
Demand-side flexibility is key for a renewable-powered future, as renewable can match energy demands to times where they are available.
From a DSO perspective, trainers drew the attention on the impact that digitalisation will have on network codes. They recalled the importance of having data and being able to process them in real time, in order to manage the system. Digitalisation can help reduce power system costs by improving safety, increasing productivity, reducing costs, and multiple other ways.
There is a need for reactive and proactive legislation and regulation because a weak security infrastructure can have dire consequences on the DSOs, warned the speakers.
Also, the essential role played by smart grids in the utilities’ transformation was stressed repetitively.
Addressing the challenges and opportunities, instructors indicated that digitalisation can help increase efficiency, productivity and energy savings in transport, buildings and industry. However, it entails risks which, while not unique to the energy sector, need to be assessed and managed, like cybersecurity and privacy.
Indeed, there are no frontiers for cyber-attacks, noted a cyber security expert. The arrival of new components to the network and new uses are bringing new threats ranging from grid stability to integrity of components. As new threats emerge, new actions have to be undergone like setting up an effective threat and risk management system and an effective cyber response framework, continuously improve cyber reliance and build-up the required capacity and competences.
Trainers provided the tools available for operators, suppliers, prosumers, and regulators to deal with risk assessment and threat treatment.
Participants were also taught about the monitoring role of regulators in the exchange of data among operators (TSOs and DSOs).
The Cybersecurity Act and Cybersecurity Certification for the energy sector were then presented and explained in detail to participants.
Finally, the training explored the role of consumers/prosumers and the evolution of quality of service a new business model.
The electric system is indeed changing from the traditional power systems where well-defined tools existed from generation to consumption, to a more distributed model with different emerging stakeholders, in particular prosumers.
Flexible grids are important to be able to support the increasing demands of prosumers, highlighted the trainers. A lot of investments are moving towards distribution networks. With flexibility we can manage congestions, regulate voltage levels, and support operators in case of faults, explained the instructors.
Regulatory experiments are very important to put in practice all these technologies. In the future, the real flexibility will come from the customers. Customers will be more aware
about their energy consumption and how to participate in the overall energy system.
Smart meter will be the enabler for the customer participation.
Looking at the role for energy regulators in cybersecurity, lecturers stated that regulators must make sure that the investments done are reasonable and are going in the right direction.
In performance-based regulation, the regulator may provide operators with economicsignals to enhance the quality of service. They must define Quality of Service metrics, including protection from cyber threats.
Cybersecurity is always evolving, and it is necessary to include uncertainty mechanisms in the regulation. There is no single best practice for all countries as it depends on the characteristics, values, and laws of the country. However, a list of steps in the regulation should not be skipped for the regulation to work well, concluded the last speaker.