Podcast: The Buildings as a Grid approach to electrification

ANGELA SWANN (HOST): Hello, I'm Angela Swann here with another Eaton 10 in 10 podcast. Buildings are becoming a lot more complicated as the world grapples with the challenges of climate change and the energy requirements of fast growing economies. Today, I'm here with Delphine Clement, our EMEA commercial buildings segment leader, to discuss how intelligent power technology is advancing the energy transition with the focus on commercial buildings.

So, Delphine, hello. We've got 10 minutes and 10 questions. Let's get started. Thinking first, about the energy transition, what are some of the macro trends impacting today's energy needs for commercial buildings?

DELPHINE CLEMENT: So geopolitical tensions are causing turbulence in energy markets around the world at the same time as many countries are switching from fossil fuels to less carbon intensive energy sources in line with the United Nations Paris Climate Accord. It's a difficult time to be making the energy transition, but it's necessary. And climate science says the world doesn't have much time to spare if the transition is to be effective.

But at least technology is on our side. Renewable energy technologies will help societies make the switch to a low carbon world. What matters is the approach to energy transition, how technology comes together with power management.

And that's where we fit in. Commercial buildings acting as energy hubs will play a crucial role in meeting their own energy needs as well as supporting the energy requirements of the towns and cities that are on the same energy grids. This is what is known as decentralization in the energy industry.

ANGELA SWANN: That's interesting. So can you tell me more about decentralization?

DELPHINE CLEMENT: The big story of the 21st century will be the move back to decentralization the user will become more involved in generating and managing energy but with a big difference because it will be low carbon energy, digitally controlled. Energy sources will include solar panels and wind turbines. This means decentralization creates a volatile energy supply because the sun isn't always out, and the wind is always blowing.

So managing energy becomes very important. The user and the grid need flexibility. And we know that EVs will play a vital role in the energy management of many commercial buildings in the future because as well as consuming energy, their batteries can store energy.

ANGELA SWANN: I see. So in a nutshell, decentralization, decarbonization, and digitalization all brought together in a single approach to power management, that's what will be important in the years ahead. What will this mean for our everyday lives? Will we see a lot of changes?

DELPHINE CLEMENT: Yes, we will see big changes. Increasing demand for more sustainable energy resources will be evident everywhere. The way we generate, store, and use power for activities that have been fossil fuel for many years will change. Electrification will happen all around us.

It's only by storing and managing power efficiently close to the point of use, effectively using everything as a grid, that we can achieve the run the clock smooth flow of energy, which will be so important. And as part of our everything as a grid approach, we have developed building as a grid for buildings that are used by a lot of people such as shops, offices, hotels, and apartment buildings.

ANGELA SWANN: And what are the immediate power management worries for commercial building owners?

DELPHINE CLEMENT: We know they are thinking about resilience and costs both because of global turbulence around long term energy supplies and prices and because of the need to reduce carbon emissions to mitigate climate change. In many countries, policymakers are getting involved. And that means building owners and developers are facing tougher regulations. This will force them to make change, and they want to be ahead of the curve.

In Europe, the European Green Deal and the Fit for 55 legislative package to help deliver it are leading the way. Countries outside the EU and in other parts of the world are developing similar regulatory approaches. And in the US, $10 billion in grants and other tax incentives for buildings efficiency has been proposed. EV charging is coming sharply into focus for commercial building owners.

For many it's no longer a question of whether or not to install EV Chargers. It's more a matter of how many chargers will be needed, how quickly, and where will the power come from. Existing buildings are limited by their electrical infrastructure. And that impacts power capacity availability. The need for flexibility at the level of the building and the need to manage energy flows to meet the building's owner preference, sustainability costs, and regulations are all issues to be considered.

ANGELA SWANN: Let's talk more about the buildings as a grid approach. Can you simplify what that means?

DELPHINE CLEMENT: We have designed buildings as agreed to be the most comprehensive and integrated energy transition offer on the market for building owners. It's based on a concept known as sector coupling, which makes the most efficient use of energy, particularly renewable energy, by coupling consumption with production.

In a commercial building, it's likely to involve combining an energy storage system with on site generation and/or EV Chargers. The outcome is decarbonization, less energy from the grid is consumed, and more zero carbon energy from on site generation is used and increased resilience against power shortages and price spikes.

The fact that the energy is digitally controlled on site makes new approaches to energy management possible. Bidirectional energy flows will be very important to creating around the clock energy availability on the grid. Electrification relies on digitalization. And the buildings as a grid approach is all about creating a smart ecosystem that enables power to flow back and forth between on site assets and between buildings and the grid. That is very different.

ANGELA SWANN: What sort of technology is involved?

DELPHINE CLEMENT: For many commercial buildings EV charging will be the root into the energy transition. So there are three pillars to our approach, which is enabled by our Brightlayer digital, platform, an EV charging ecosystem with EV Chargers and software enabling charger operations, an energy management ecosystem with energy storage and software, relying on the power distribution of the building, and the glue of the system, which is the energy management software.

ANGELA SWANN: And do commercial building owners need to invest in all three pillars of the technology?

DELPHINE CLEMENT: So the energy management software is essential, but the scalability of the buildings as a grid approach is what makes it attractive to commercial building owners and developers. It provides more control over when and how they use power and where they source it from. This is called load shifting.

They can start with energy storage to take in low priced energy from the grid for use when prices are higher. This helps smooth demands on the grid, a process known as peak shaving. And beheading on site renewable generation, they gain a supply of 0 carbon energy, which can also be stored for use when needed.

This remove demand from the grid completely. And if they need EV charging, and most commercial buildings do, they can include Chargers in their buildings as a grid approach, starting with a few and adding more when needed.

ANGELA SWANN: This technology can clearly benefit the grid, and that's great to know. But building owners will want financial benefits to justify their investment. What can they gain in the short and long term?

DELPHINE CLEMENT: From day one building owner can ask vehicle users to pay for EV charging. This can help offset installation and day-to-day running costs, and some businesses can gain competitive advantage by using EV chargers to attract customers and maintain loyalty. Building owners can avoid expensive grid upgrades and reduce their energy bills by shaving, load shifting, or substituting self generating energy from sources such as solar panels.

Another big benefit relates to protecting the value of their buildings. Tenants and property investor will expect buildings to be capable of flexible energy management including EV charging. And they will expect buildings to comply with regulation.

New regulations are emerging quickly Remember the EU's Fit for 55 that we spoke about just now? That package of legislation is targeting a 55% reduction in carbon emission compared with 1990 levels by 2030, just eight years from now.

ANGELA SWANN: It all sounds great, but do you have any actual examples of how it works?

DELPHINE CLEMENT: Yes, we do. For instance, in France our buildings as a grid approach is helping the Catholic University of Lille to deliver on its zero carbon campus commitments. The university stores energy from photovoltaic panels in our energy storage system to use when and how they choose.

This gives them a great deal of flexibility compared with traditional PV systems, which provide energy for immediate use only. And the system powers EV Chargers. This is decarbonization, decentralization, and digitalization in action.

ANGELA SWANN: So last question, how can commercial building owners get started with the buildings as a grid approach?

DELPHINE CLEMENT: So we are already offering this approach to customers. If you are a commercial building owner or developer, come and speak to us wherever you are based. The energy transition is moving fast. It certainly is. Thank you, Delphine. To learn more about how we're enabling the shift towards a renewable future visit Eaton.com/BuildingsAsAGrid.