Self-Consumption is the Cornerstone of the Photovoltaic Revolution

The increase of self-consumption in Spain is an opportunity for the expansion of the photovoltaic energy, but it also entails certain risks if its implementation is not carried out in a planned manner.
Self-Consumption is the Cornerstone of the Photovoltaic Revolution

The opinion held by majorityof the public is that the self-consumption of electricity is beneficial for consumers and the electrical system in general. Thanks to the outreach of organizations such as UNEF and APPA, self-consumption has a good public image. The proposal for a new Royal Decree to regulate self-consumption, which was made public a few weeks ago, has been received as positive news and is perceived as a step in the right direction, and it has been embraced by AleaSoft.

Currently, self-consumption also has a central role in the energy sector due to its positive growth prospects in the coming years, favored by the new regulation. So much so, that this year’s GENERA 2019 fair has it as the central theme: "A new scenario for Self-Consumption,” with several forums and technical conferences around this topic. At the fair, which will take place between February 26 and March 1 in Madrid, UNEF organizes two technical conferences on self-consumption: success cases and technological challenges.

The photovoltaic association will also hold another technical conference on financing photovoltaic projects on March 1. AleaSoft will participate with the presentation “The price curve in the new reality of Solar Photovoltaic Energy projects." There will also be several technical conferences during the fair, one of them on self-consumption, energy storage and electric vehicle.

Self-consumption, at least in its most popular variant of domestic self-consumption with photovoltaic panels, uses renewable energy sources, which is perceived as, and certainly is, favorable to the environment. The ecological transition towards electricity production increasingly free of polluting emissions is not possible without the participation and widespread introduction of self-consumption in industries and households, according to AleaSoft.

At the same time, self-consumption contributes to the decentralization of electricity production and gives more prominence to the consumers, who can not only manage their electricity demand, but can also self-produce part of the electricity they need and even sell the surplus energy. Currently, the costs of a photovoltaic installation for self-consumption have become more affordable for some small industries, communities of owners and some individuals.

Obviously, the costs will depend on the size and power of each installation, which in turn will depend on the power and energy needs, and on the fraction of the consumption that wants to be self-produced

Industries can afford larger investments and usually have more area for the installation of panels, so the cost per kWp will be lower and the investment, more efficient. In these cases, being able to sell the surplus energy and become a producer will be an option to amortize the installation more quickly.

For the self-consumer, both domestic and industrial, the electricity consumed as a whole, both from the grid and self-produced, will have a lower cost per kWh, and will tend to substitute other fuels for electricity such as gas, in homes and industries, or gasoline, in transportation.

Another aspect that will significantly favor the expansion of self-consumption is the reduction of costs of energy storage systems. The storage of electricity with batteries is the perfect complement for a self-consumption installation that allows matching the production curve, centered in the central hours of the day, with demand normally lower towards the evening hours.

For larger self-consumption installations in industrial facilities, or even for photovoltaic production plants, other storage systems more suitable than batteries will gain prominence. Hydrogen, for example, can store a large amount of energy for long periods of time, and can be reconverted into energy without generating waste.

Also, from the point of view of the electrical system, self-production and self-consumption of electricity brings several benefits. The self-production from renewable energy sources is a boost to the decarbonization of electricity production and is a key element to achieve the goals of renewable production for 2030 and 2050. These goals imply a share of renewable energy use of 32 percent by 2030 that, according to AleaSoft, will be difficult to reach, and without the contribution of self-production, mainly photovoltaic, they are considered unachievable.

When self-consumption reaches a significant volume, the management of the electrical system becomes more complex because it is necessary to predict in real time both the amount of energy that is not going to be consumed from the grid, as well as the surplus of self-consumption that is going to be fed. The increase in self-consumption will lead to new ways of managing the network and surplus energy in a more dynamic and intelligent way. The technologies based on the blockchain will have an important role in this aspect. With them, the management of distributed demand and production will be carried out in a decentralized, transparent and consensual manner in real-time.

The Iberian Peninsula has a robust electricity system that allows it to have a perfectly coupled market between Spain and Portugal most of the time. This network will be able to absorb the expected increase in self-consumption for the coming years, but photovoltaic self-consumption in the Iberian Peninsula will have a great north-south asymmetry, due to the naturally available solar resource. This asymmetry will compensate the historical asymmetry between the production of electricity, which is more concentrated in the northern part with large water reservoirs and gas and coal power plants, and consumption, which is higher in the southern part due to its larger population. This causes a flow of electricity from north to south that, when congested, can cause technical restrictions. With greater photovoltaic production in the south, due to the greater number of hours of sunlight and incident radiation, both in self-consumption facilities and in large solar power plants, network congestions will tend to be reduced and, at the same time, more wealth will be created in areas that historically have been less favored by the lack of industrialization.

There will come a time when a point of equilibrium is reached where self-consumption means a benefit for the electricity system without greatly increasing its management costs. According to AleaSoft, we are still far from that point and there is enough room for self-consumption to expand without problems.


For information: AleaSoft Energy Forecasting.

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