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MATRIX Report: Vol 10. February 2013
Sustainable Energy Horizon Panel Report Executive Summary
Prepared for MATRIX by:
MATRIX SUSTAINABLE ENERGY HORIZON PANEL MEMBERS Aaron Black – South West College
John Kinney – Cleanfields Technologies Ltd.
Paul Brewster – Pure Marine
Sam McCloskey – Centre for Advanced Sustainable Energy
Denzil Conn – Northern Ireland Electricity Joe Corbett – Mainstream Renewable Power Bjorn Elsaesser – Queen’s University Belfast Michael Harnett – Bioil Ltd. Philip Johnson – Delta Carbon Chris Johnston – AFBI
Clifford McSpadden – CMS Global Ltd. Clare Passmore – Clear Spirit Design Ltd Garry Staunton – Technology Strategy Board Neil Stewart – Glen Dimplex David Surplus – The B9 Energy Group (Chair)
IMPORTANT NOTICE Whilst reasonable steps have been taken to ensure that the information contained within this Report is correct, you should be aware that the information contained within it may be incomplete, inaccurate or may have become out of date. Accordingly, the MATRIX SEHP makes no warranties or representations of any kind as to the content of this Report or its accuracy and, to the maximum extent permitted by law, accept no liability whatsoever for the same including, without limit, for direct, indirect or consequential loss, business interruption, loss of profits, production, contracts, goodwill or anticipated savings. Any person making use of this Report does so at their own risk.
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CHAIR’S FOREWORD global energy market oPPortunitieS, delivered by Science. Ireland to take a leadership role in the development of distributed energy solutions and their integration into Intelligent Energy Systems through establishing itself as an International Reference Site to demonstrate the commercial scalability of these solutions to the global market, which is estimated to be worth £8 billion in 2018. Capturing just a small portion of this market opportunity will represent significant economic benefit to the region in terms of job creation, inward investment, increased R&D activity and wealth generation. Today, the convergence of a wide number of political, economic, social and environmental forces is driving the development of new technologies to serve the global energy markets. As a result, small, innovative companies — either on their own or through partnerships with large, established energy corporations — are generating competitive solutions to address some of the most pressing issues society is facing. There is a huge potential for companies in Northern Ireland to tap into these markets and last year the DETI Minister tasked MATRIX with identifying how to grow the Northern Ireland economy through the development of sustainable energy technologies. I was honoured to be asked by my peers to chair the MATRIX Sustainable Energy Horizon Panel whose aim was to assess the current capability of the sustainable energy technology sector in Northern Ireland and identify the medium to long term global opportunities in this market which local companies can exploit. This report is the result of the work of the panel which has identified a compelling opportunity for Northern
I would like to thank the panel for their intensive work over the past six months and everyone who participated in the compilation of this report. I also acknowledge the work of Orion Innovations who assisted at all stages in the publication of the sustainable energy report.
David Surplus Chair – MATRIX Sustainable Energy Horizon Panel
The development of an Intelligent Energy System can not only provide significant export opportunities for Northern Irish businesses, it can simultaneously address the challenges facing the existing electricity infrastructure in Northern Ireland and improve the sustainability, security and affordability of the regional energy supply. The recommendations contained in the report have been driven by our vision that within 10 years Northern Ireland will be an internationally recognised exporter of global solutions forged from the development of the lowest cost, sustainable energy infrastructure in Europe. To help make this a reality we have taken steps to establish an ongoing Delivery Team comprised of industry, academic and government parties that will work together towards ensuring the recommendations are implemented. This group will provide joined up advice to policy makers in order to remove anticipated barriers and will also make appropriate suggestions for possible topics of future R&D funding calls.
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Introduction MATRIX, the Northern Ireland Science Industry Panel, is an expert advisory panel reporting to the Department of Enterprise, Trade and Investment (DETI) and the DETI Minister on matters pertinent to the exploitation and commercialisation of science, technology and R&D. It is led by high-technology and R&D intensive industry experts and advises the Northern Ireland Executive on the development of improved interfaces between Northern Ireland business and the research, science and technology base, with a view to ensuring that the region’s science and R&D strengths are exploited for maximum economic and commercial advantage. The panel’s
Vision is that Northern Ireland should be ‘led by business; inspired by academia; and facilitated by Government’.1
This report summarises the culmination of those efforts and is accompanied by four detailed documents’:
DETI and MATRIX previously identified the commercial opportunities associated with sustainable energy technology markets as substantial in scope and likely to grow significantly in the coming decades, as worldwide demand for lower-carbon technologies increases. The MATRIX Sustainable Energy Horizon Panel (SEHP) was established to build on the existing base load of intelligence, and extrapolate forward to identify attractive global market opportunities that could be realised by exploiting Northern Ireland’s science, research and technology capabilities.
• Sustainable Energy Horizon Panel Report; • Annex 1 Literature Review Insights Report; • Annex 2 Technology Capability Assessment; • Annex 3 Market Foresight Report.
The MATRIX Sustainable Energy Horizon Panel has defined the following Vision Statement: Within 10 years Northern Ireland will be an internationally recognised exporter of global solutions forged from the development of the lowest cost sustainable energy infrastructure in Europe: • Created by thriving, indigenous businesses; • Exploiting the regions natural, intellectual and entrepreneurial capital. Directly driven by this Vision, this report makes the case for the exploitation of a significant future global market opportunity for Northern Ireland based around the development and export of Intelligent Energy Systems and associated know-how. This will be achieved through the early regional deployment of integrated and sustainable energy solutions that have
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global relevance, demonstrating their commercial scalability, and establishing the profile of Northern Ireland as a leading and credible International Reference Site. The Vision is underpinned by a number of key assumptions which have directly informed the development of the MATRIX SEHP Recommendations.
http://www.matrix-ni.org.
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These are based on exploiting regional competitive advantage to address multiple strategic objectives relating to economic, energy and sustainability priorities, whilst ensuring alignment of key stakeholder needs and minimising the cost to the customer.
current regional tecHnical caPability An analysis of existing regional capability in the sustainable energy sector generated an overview of the existing scientific, research and technological capacity of the region, and identified key differentiating and commercially competitive features.2
few large, international corporate entities active within the regional sector, notable companies include: Harland and Wolff; Glen Dimplex, DONG Energy, McLaughlin and Harvey, Kingspan, F.G. Wilson, and Copeland (Emerson Climate Technologies).
Northern Ireland has an evolving and maturing sustainable energy supply chain with approximately 500 currently active companies, of which the majority are within the wind, marine, bioenergy, and integrated building technologies sectors. There is particular expertise in systems engineering and offshore services.3
Northern Ireland has two Universities, Queen’s University Belfast (QUB) and University of Ulster (UU) both of which are considered world class in a range of research areas, including marine research at QUB and built environment research at UU. In addition, the AgriFood and Biosciences Institute (AFBI) conducts leading research into the growth and processing of biomass crops (including SRC Willow). The network of six regional colleges provides a robust and coherent base of applied research, demonstration
In common with Northern Ireland as a whole, the vast majority of these companies are micro SMEs (< 10 employees). While there are relatively
and skills provision. In future, the proposed Centre for Advanced Sustainable Energy (CASE) will provide a single focal point for targeted collaborative Research, Development and Demonstration (R, D&D) in the sustainable energy sector, coordinating activities across academic institutions and industry. Key physical assets of relevance in the region include the SeaGen tidal generation turbine in Strangford Lough, the harbour facilities, the Northern Ireland Advanced Composites and Engineering Centre (NIACE), and the Northern Ireland Science Park (NISP).
Specific regional strengths and potential differentiators have been identified in relation to:
2 3
Resources and Geography
1. 2. 3. 4.
Availability of natural resources – wind, marine and biomass. Bridgehead location (and physical proximity) between Republic of Ireland and rest of UK. Know-how and practical experience in operation of ‘island’ electricity system. Significant number of farming businesses with potential to act as nuclei for rural community-based projects.
Infrastructure
5. Northern Ireland has, and is developing, electricity interconnectors. 6. Ability to demonstrate and exploit know-how relating to next generation technologies in a challenging technical and economic environment.
Academic Base
7. World class academic teams in areas of marine, low carbon buildings, micro-renewables, biomass, power engineering and energy storage. 8. Highly skilled and trained workforce with practical experience in deployment of sustainable energy technologies.
Industrial Capability
9. Track record of success in new and imported technology adaptation and deployment. 10. Strong and flexible industrial base with diversification potential.
Public Sector Intervention
11. Sympathetic and supportive innovation landscape (including fiscal support mechanisms such as Renewable Heat Incentive (RHI)). 12. Evolving focus on key elements of the sustainable energy sector.
matrix Sustainable energy Horizon Panel report, annex 2 technology capability assessment, available from www.matrix-ni.org low carbon buildings and micro-renewables.
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Global Market Foresight Analysis was undertaken to provide a 10 year (and beyond) outlook to inform the identification of future strategic international markets for Northern Ireland.4 Onshore and offshore wind, bioenergy, integrated building technologies and marine energy were all identified as offering potential future market niches in which Northern Ireland could leverage its existing capability. However, across all segments of the future sustainable energy market, the role of system integration and intelligent network management is widely anticipated to be the key to unlocking long-term economic potential. The development and deployment of intelligent systems will be fundamental to matching supply and demand across
increasingly complex energy networks, and in facilitating the paradigm shift whereby current consumers of energy will become energy generators. The overall functioning of the system will become increasingly important, not just the performance of the individual technologies.
support the accelerated development and deployment of complementary sustainable generation technologies (both current and future).
As a result, the commercial demonstration of the grid integration of renewable and sustainable distributed energy technologies using intelligent energy systems (IES) was identified as providing an attractive and flexible platform for future exports for Northern Ireland. At the same time, this approach will provide a framework and catalyst to
Intelligent Energy Systems incorporate technologies that can measure, analyse, communicate and control the multi-directional flow of energy at a variety of scales. They exploit the symbiotic relationships between technologies, improving efficiency (matching supply and demand), and enabling a new set of stakeholders (including consumers) to become active participants in the energy market. Intelligent Energy Systems include electrical and heat distribution networks, remotely controllable loads, modern energy storage, power electronics technology and computerised control system management.
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MATRIX Sustainable Energy Horizon Panel Report, Annex 3 Market Foresight Report available from www.matrix-ni.org
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tHe oPPortunity For nortHern ireland Northern Ireland is currently in a unique position relative to the rest of Europe, being the first market to face the commercial realities and multiple challenges of high density grid integration of renewables. Northern Ireland’s existing electricity infrastructure is now reaching maximum capacity: the ‘islanded’ network is unable to accommodate the region’s significant potential for distributed renewable energy, with the result that there is curtailment of grid-connected generation, and high levels of additional capacity awaiting connection.5 Connection of these assets will be critical in achieving the target contained within Northern Ireland’s Strategic Energy Framework of 40% electricity from renewable sources.
Investment in ‘intelligence’ (communications and control infrastructure), coupled with some storage capability, will enable better exploitation of renewable resources and maximise the utilisation of the existing infrastructure. Optimising and adapting existing assets, and the development of interconnected systems, will be necessary if deployment of sustainable energy technologies is to be fast tracked and the associated economic, environmental and social benefits realised. Development of Intelligent Energy Systems is the common denominator required for the successful commercialisation of sustainable energy technologies whilst extending the life of the current network.
No individual region has currently established a leadership position in this sector, and there is an acknowledged lag in the integration of distributed renewable generation onto the intelligent energy system.6 It is this area in which Northern Ireland has the opportunity to lead, exploiting first mover advantage to become an ‘early adopter’ commercial Reference Site for scalable solutions for international markets and to secure a share of the potential export revenue. This will allow exploitation of existing regional strengths whilst building a sustainable platform for the future development of next generation technologies and related intellectual assets and skills.
This diagram illustrates how market-ready, simple, commercial showcases (e.g. energy storage solutions), will pave the way for demonstration of more complex systems (e.g. offshore marine), and subsequent development of emerging technologies (e.g. composite materials). This will enable eventual deployment of fully integrated complex systems, combining multiple technologies.
High
Increasingly sophisticated and scaled projects
Larger, more complex deployment
For example:
• Fully integrated and interconnected network
For example:
System Complexity System Complexity
• Off shore marine • Tidal
Low
First Commercial Showcases
Next generation solutions
For example:
For example:
• Onshore wind • Bioenergy generation (AD of farm waste) • Building scale renewables • Energy storage solutions • Demand response
• • • • •
Composite & advanced materials Advanced thermal treatment Advanced controls Cyber security systems Sustainable raw materials
Time to Market 2013
2018
2023
in 2011 the dispatch-down energy from variable price taking wind generation was 13,415 mWh in northern ireland. this represents 5.3% of the available energy from these generators in this period. in october 2011 Soni published a consultation paper “consultation on generator connection Process-itc methodology to determine FaQs & generator output reduction analysis”. the consultation shows northern ireland in 2016 as having extremely high levels of curtailment (13.5%) together with constraints of 1.81% at many nodes, leaving a combined maximum potential constraints and curtailment of 13.66%,- nirig response to decc call for evidence Part b, 15th november 2012.
5
6
iea, technology roadmap, Smart grids, 2011, http://www.iea.org/publications/freepublications/publication/smartgrids_roadmap.pdf.
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Forecasts suggest that global revenue from intelligent grid renewables integration could grow from £2.5 billion in 2012 to just over £8 billion in 2018.7 Within this projection, growth is anticipated to be particularly strong in advanced storage technologies and
microgrids. Capturing just a small portion of this market opportunity will represent significant economic benefit to the region in terms of investment in R&D, job creation and inward investment.
In addition to direct economic benefits, realisation of the proposed Vision will ensure that Northern Ireland will gain from a large number of related direct and indirect advantages including:
beneFitS oF develoPing an intelligent energy SyStem Government
• Addresses all four principal aims of the Strategic Energy Framework. • Facilitates realisation of the 40% renewable electricity target by 2020 and the 10% renewable heat target. • Contributes to compliance with the recently adopted EU Energy Efficiency Directive, including refurbishment of 3% of public buildings each year. • Contributes to the UK’s Bioenergy Strategy principles. • Contributes to reductions in regional waste disposal costs and associated environmental impacts. • Benefits the local (and in particular the rural) economy, via decentralised community energy generation and associated job creation (e.g. installation & maintenance).
Customers
• Maintains competitiveness across all industrial sectors as a result of developing a more reliable, more resilient and cheaper regional energy system. • Empowers consumers to become participants in the energy system with potential to generate new sources of revenue.
Supply Chain
• Enables a step-wise approach to the deployment of distributed generation and intelligent systems that builds market confidence. • Reduces barriers to entry for small-scale renewable energy generators, such as high up-front connection charges.
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Pike research Sgri-12-executive-Summary
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ProPoSed ForeSigHt imPlementation Plan MATRIX SEHP has defined a high level Road Map for a Foresight Implementation Plan which identifies the key steps required in the development of sector-leading capability in Intelligent Energy Systems over the next ten years:
2013
2018
• Secure resources & launch. • Identify priorities for ‘quick wins’. • Put in place detailed plans. • Gather intelligence to underpin plans.
•
Identify and select options for next generation projects, and ‘value adds’ to existing projects • Exploit related commercial opportunities.
The MATRIX Foresight Implementation Plan represents a flexible, enabling framework which seeks to consolidate and build on existing activities and capabilities to realise critical mass, whilst providing a nucleus to facilitate successful future growth.
• Active drive for commercial exploitation and export of proven solutions.
• Scale up and increased sophistication of commercial demonstrations.
2023
• • Scale up of supply chains and manufacture of solutions for expert markets.
It provides a holistic approach to market development and exploitation, leveraging existing regional competitive advantage in the short term, whilst evolving new commercial capability and know-how over a longer time horizon.
Leading international reference site and exporter of Intelligent Energy Systems and professional services.
Specific activities have been defined within the Road Map and classified as core (those fundamental to realising the technical and commercial proof points for market exploitation) and enabling (those required to facilitate the development of an economic landscape that supports market development).
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recommendationS A compelling opportunity has been identified for Northern Ireland to:
integration of renewable generation (including onshore and offshore resources) and embedded energy storage.
• Take a leadership role in the development of distributed energy solutions and their integration into Intelligent Energy Systems that will optimise efficiencies through the use of local resources and participation of multiple stakeholders;
The academic base will have developed a strong pipeline of next generation, and market-led, intellectual assets, and providing best in class skills training. Multiple regional players will be directly engaged in the market, employing new business models and commercial vehicles. Maturing supply chains will be in place with significant manufacturing of equipment and balance of plant. Northern Ireland will be exporting specialist technology, services and know-how to overseas markets and beginning to put in place large interconnected regional and national infrastructure projects.
• Create an International Reference Site to demonstrate the commercial scalability of these solutions to the global market. This will not only provide significant export opportunities for Northern Irish businesses, but will simultaneously improve the sustainability, security and affordability of the regional energy supply. As such, it is closely aligned with Priority 1 of the Programme for Government 2011-2015: ‘Growing a Sustainable Economy and Investing in the Future’.8 If the Vision is successful, by 2023 Northern Ireland should have an active and intelligent energy network, with large scale
1. Immediate Execution of MATRIX Foresight Implementation Plan ‘Urgent Action’
2. Leadership and Communication ‘Market Confidence’
3. Innovation Support for
SMEs ‘Long term Capacity Building’
4. Build International Networks ‘Exploiting Regional Competitive Advantage’
5. Develop Innovative Financing Models ‘Pump Prime Commercial Deployment’
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The MATRIX SEHP has defined five key Recommendations which are considered to be fundamental prerequisites for the future successful delivery of the MATRIX Foresight Implementation Plan:
• Formation of industry led Implementation Group to provide overview, guidance and monitoring of Foresight Implementation Plan and ensure alignment of key stakeholders. • Recruitment of dynamic and commercially orientated Delivery Team for day to day planning and management of Foresight Implementation Plan. • Mechanisms to be put in place to optimise communications across all levels of the sector (public, private and academia). • Alignment of key policies across all government Departments. • Exploitation of public procurement models where appropriate.
• Mining of existing regional intellectual assets. • Review and development of existing support to make it more appropriate/ accessible to SMEs and accelerate internationalisation. • Skills development capacity building.
• Further refine relative regional USP relating to Intelligent Energy Systems. • Identify key strategic partnerships to share know-how and develop future projects/economic opportunities (academia, public sector agencies and industry).
• Development of focused and attractive financial support programmes for the sector (pre-commercial finance). • In addition to public procurement, explore options for an alternative financing vehicle to provide risk and/or working capital for commercial demonstration projects.
northern ireland executive, Programme for government 2011-2015; http://www.northernireland.gov.uk/pfg-2011-2015-final-report.pdf.
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Acknowledgement As the global population increases and with it industrial activity, the demand for energy is on the rise. However, increasing environmental and geopolitical concerns and the depletion of the world’s natural resources has increased the worldwide demand for energy security through renewable energy technologies. This situation has led to an increase in R&D in innovative products and designs - an area in which Northern Ireland has strong science and technology capability. Comprised of 15 industry experts and academics from a range of sustainable energy backgrounds, the MATRIX Sustainable Energy Horizon Panel has undertaken a comprehensive programme of work, over a six month period, to map and assess the current capability of the sustainable energy technology sector in Northern Ireland and to identify the future global opportunities available for the region. The ‘MATRIX Sustainable Energy Horizon Panel’ report is the culmination of that work.
insights and expertise in shaping this report which I believe will contribute enormously to the future of the region’s sustainable energy sector. I also thank the Minister for Enterprise, Trade and Investment, Arlene Foster for her continuing support of MATRIX, the Northern Ireland Science Industry Panel.
Bryan Keating Chair - MATRIX, the Northern Ireland Science Industry Panel
I wish to express my gratitude to David Surplus, Chair of the Sustainable Energy Horizon Panel and the entire panel for their invaluable technical
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