What role will power grids, energy storage, and consumers play? A distributed, democratized model in which users become prosumers
Electrification requires a new mindset when it comes to managing electricity. Arjona explains it through an analogy: the shift from the television model to the internet model. While today’s energy system is one-way (one provider and many passive recipients), the new distributed energy system allows every individual or community to be both a consumer and a producer (otherwise known as a ‘prosumer’).
As the University of Granada professor explains, this system could rely on smart grids and artificial intelligence to anticipate demand curves and manage renewable generation, which, unlike gas or coal, is intrinsically intermittent. In this context, where wind and solar account for a large share of total generation, the electricity system needs flexibility—i.e. the ability of energy infrastructure to adjust generation, demand and energy storage in real time—to prevent outages, grid stress, and imbalances. The financial sector will also play a key role in developing new types of contracts and price hedges for a much more complex market.
Spain in the new electricity and renewable energy industry
As Europe’s new energy landscape takes shape, Spain is well positioned to expand renewable generation thanks to its combination of sunshine, wind and, above all, available land. Arjona argues that Spain could become a “very serious competitor to France and Germany,” because producing energy in Spain is much more cost-effective than, for example, in the North Sea, where the installation and maintenance costs of offshore wind turbines are considerably higher.
According to the University of Granada expert, Spain has an “excellent opportunity,” but one that calls for a shift in mindset and for energy to be viewed not as a passive resource, but as a driver of regional balance and future economic growth.
What are the main benefits and challenges of electrification in Europe?
Electrification of the economy, grid interconnection, renewable generation, and storage capacity form the backbone of the future electrocontinent. Key benefits include:
- Making better use of renewable energy generation.
- Becoming less dependent on fossil fuels.
- Increasing energy security.
- Lowering process and operating costs by using more competitive clean energy.
- Improving grid stability.
However, the EU cites several challenges associated with electrification:
- Cost: Electricity costs around three times as much as gas.
- The time, running into years, required to increase grid connections.
- The commercial scalability of innovative technologies.
- The lack of incentives for businesses to switch from fossil fuels to electricity.
Source: www.bbva.com
