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Behind the scenes of Equigy

Equigy is a crowd balancing platform launched in Switzerland by the transmission system operator Swissgrid and developed by a consortium consisting of Swissgrid, TenneT (TSO in the Netherlands/Germany) and Terna (Italian TSO). Using blockchain technology, the platform’s objective is to integrate small decentralised units into the balancing energy market. Among other technologies, these resources include small-scale residential batteries and electric vehicle batteries. As one of the largest electricity producers in Switzerland, that already provides balancing power from a flexible power plant portfolio and that markets decentralised third-party resources, Alpiq has relevant experience for this project. In the following, Evangelos Vrettos from Swissgrid answers our questions on Equigy, highlights the technical background and offers an outlook on how the ancillary services and balancing energy markets could develop in the future.

Evangelos Vrettos

Research & Digitalisation Manager at Swissgrid
Project Manager of the Swiss Equigy pilot project

Hello Evangelos Vrettos, thank you for taking the time to answer our questions.

Equigy facilitates the access of decentralised flexibility resources to the ancillary services and balancing energy markets, allowing them to be controlled by an aggregator. The platform creates new business opportunities for existing market participants and facilitates access for new players.

Thanks to blockchain technology, the platform improves the transmission system operators’ (TSO) business processes relating to ancillary services, with a special focus on the registration of decentralised flexibility resources, prequalification, real-time monitoring of reserve availability, and ex-post validation of delivered services. The goal behind Equigy is to create communications standards for ancillary services and balancing energy markets at a European level as well as to leverage experience, synergies and existing developments in order to boost the growth of the ecosystem and its adoption by TSOs.

What technology does Equigy apply?

Equigy is based on the Hyperledger Fabric technology, which is a permissioned blockchain infrastructure. Hyperledger Fabric provides a modular architecture for the development of applications and solutions.

Why is blockchain technology particularly suitable for the aggregation of decentralised flexibility resources?

The strength of the permissioned blockchain lies in the following factors:

  • Trusted replication across network participants (“one truth”) thanks to immutable cryptography-based transactions

  • Transparency/traceability while preserving privacy among network partners

  • Increased efficiency of business processes thanks to the automation of business rules within smart contracts that are based on the blockchain

These factors become particularly important within a scenario with many aggregators and a very large number of decentralised flexibility resources. Blockchain technology can help automate a larger number of otherwise manual processes, while maintaining the validation of availability and correct delivery of reserve power.

What milestones has Equigy achieved in Switzerland so far?

Firstly, we successfully set up a pilot project for frequency containment reserves (FCR) including the implementation of a minimum viable product (MVP) as well as reaching out to the Swiss market to trigger interest and obtain feedback. In collaboration with Alpiq, who took over the role of aggregator, we successfully completed the testing phase of the MVP. Based on the analysis of the results, we can say that the pilot project has proven that blockchain technology can efficiently support the FCR business processes under consideration. We see benefits for the owners of flexibility resources, the aggregators and the TSOs, and the market acceptance is given.

What exactly was tested and when did the tests take place?

The tests included the registration of flexible resources and groups of resources, the offering and awarding of flexibility, and the real-time monitoring of reserve availability. The tests ran during two weeks in the summer of 2020 and were carried out with a 1 MW battery storage system in Maienfeld.

What sets the Swiss project apart from the proof of concept projects in the Netherlands and Germany?

The proof of concept projects in the Netherlands and Germany focused on automatic frequency restoration reserve (aFRR), also known as secondary frequency control, and redispatch, respectively. The Swiss pilot project focused on a different ancillary service called frequency containment reserve (FCR), also known as primary frequency control. The technical requirements and implementation challenges of FCR are different than those relating to aFRR and redispatch. FCR is a faster ancillary service that is activated in a decentralised manner. This results in increased challenges with regard to storing and analysing larger datasets with a high resolution at the level of just a few seconds. Furthermore, FCR is based on a specific aggregation model, namely a structure according to which decentralised flexibility resources are organised into groups to participate in the market, which must be reflected in the registration process on the platform.

Are there any solutions besides blockchain with the potential to make volatile producers and storage facilities more flexible or to use them to provide balancing energy?

Blockchain is not the only possible technical solution for this application. Indeed, conventional databases could be used on the platform instead of the blockchain. Nevertheless, a conventional database cannot provide the same advantages as blockchain with regard to data immutability and trusted replication. In other words, other technologies would require a central authority that is trusted by everyone to assume the responsibility for data correctness and operation of the database.

Even Equigy does not exclusively rely on blockchain. On the contrary, Equigy is based on an efficient combination of blockchain solutions with replicated data on off-chain databases.

In order to use various distributed ledger technologies, an initiative called “DLT-for-Power” is currently running in Switzerland. Under the umbrella of the Swiss Association for Norms and Standardisation, this initiative aims to define the technical basis for a DLT-based system in the energy industry. Both Swissgrid and Alpiq are participating in this initiative, leveraging among other things their experience gained during the Equigy experiment.

What does this mean for the ancillary services market? Will it be opened up to individuals in the future?

The direct participation of private individuals in the ancillary services markets via Equigy is not foreseen at the moment. The envisioned model is that private individuals will utilise their own flexibility through aggregators, which interact with Equigy and the market. More specifically, the platform divides the roles into commercial aggregators that interface with the market and the TSO, and technical aggregators that contribute their expertise in the control of decentralised flexibility resources. The relation between the various aggregators and the owners of flexibility resources is not defined by Equigy and is up to the involved parties to decide.

Could this result in thermal power plants, which continue to play an important role in the security of supply and stabilisation of the electricity grid, being increasingly phased out?

In Switzerland, thermal power plants, especially non-nuclear thermal power plants, play a rather limited role on the ancillary services market. For example, 98% of the primary reserve power comes from hydropower plants and the remaining 2% from decentralised flexibility resources, mostly batteries, heat pumps and hot water boilers. Another small percentage of primary, secondary and tertiary control power comes from waste incineration plants or emergency generators.

By facilitating the integration of decentralised flexibility resources in the ancillary services markets, Equigy will increase market liquidity and help reduce the reliance on nuclear and hydropower plants for reserve power. However, it will continue to be important to keep zero-carbon and controllable large-scale generation resources in the energy mix.


Evangelos Vrettos has been a Research & Digitalisation Manager at Swissgrid since September 2019, where he has been managing the Swiss Equigy pilot project. In addition to Equigy, he is involved in R&D activities in the fields of maintenance scheduling, congestion management and coordination between transmission and distribution system operators. Prior to joining Swissgrid, he was a research scientist at the Lawrence Berkeley National Laboratory (California, USA) and held an engineering position at the Swiss electricity utility EKZ. He obtained a degree in Electrical and Computer Engineering from the National Technical University of Athens in 2010 and a PhD in Electrical Engineering and Information Technology from ETH Zurich in 2016.


 

Further Information

Distributed ledger technologies (DLT)

Renewable energies and small-scale power plants are shaping the future of the energy market. Decentralisation affects all electricity producers and will require a restructuring of the grids. This is a major challenge for all players in the energy system.