Accurate Modeling Allows Energy System Integration to Prosper

Q: How did encoord start operations in Mexico?

A: encoord was first founded in Germany in 2018 by Dr. Kwabena Pambour with the commercialization of the Scenario Analysis Interface for Energy Systems (SAInt) software. I was one of his first customers and after assessing SAInt’s potential, I joined him and we co-founded our company in 2019. We established our headquarters in the US, along with a German subsidiary. 

We chose to work with Mexican customers for several reasons. At the National Renewable Energy Laboratory (NREL), I had helped model the Mexican power system, quantifying the impact of renewable energy integration into the national grid. This experience allowed me to collaborate with the public and private energy sectors, including the Ministry of Energy (SENER), the National Center for Energy Control (CENACE), state governments, NGOs and private players. 

A few years after our foundation, NREL reached out to us to ask if encoord could offer its help in modeling the Mexican power system for two different studies. The first was focused on the new dispatch laws that were proposed in 2021 and their impact on operational costs and emissions. The second study analyzed the Mexican power system's renewable energy potential, trying to understand the capacity of the Mexican grid for integrating renewable sources of energy. Our collaboration with NREL allowed us to create a deep, detailed understanding of the Mexican power system. 

Q: Why should energy stakeholders think beyond electricity when optimizing a country’s energy systems? 

A: There are many reasons to look beyond electricity. First, if you care about climate change and emissions reduction, only a quarter of global greenhouse gas emissions come from the power sector. If you decarbonize the power sector, you only tackle a quarter of the issue. Another quarter of emissions comes generally from agriculture, while the rest comes primarily from industry, transportation, and heating, where electrification has been positioned as the main solution to partially decarbonize these later sectors. However, some industrial processes cannot be decarbonized through electrificationHere, other solutions like Carbon Capture and Storage (CCS) or green fuels, like biofuels or hydrogen, may be required. The flexibility and storage that the world will require to fully decarbonize are at the intersection between different energy networks and infrastructures, including electricity, gas and thermal networks. 

Energy security is another strong reason to prioritize the understanding of integrated energy systems. In many countries, including Mexico, power systems are strongly dependent on natural gas. Most natural gas power plants do not have the capacity to store fuel, leading to an extreme dependency on the ability of the gas pipeline to deliver fuel at the right time and at the right pressure to produce electricity. Contingencies that jeopardize gas transportation and distribution can become a major threat to power production and to a country’s power supply. Understanding the coupling, interdependence and synergies between electricity and gas networks has crucial importance for the operation and reliability of our critical energy infrastructures. 

Q: How does SAInt help stakeholders to better understand energy systems integration?

A: encoord’s solution provides a planning platform that can model the integration and coordination of electricity and gas networks. Our greatest differentiator is the capacity of our software to analyze these networks in an integrated model, which is necessary to quantify the synergies and interdependencies of networks that are bi-directionally coupled. At encoord, we recognize that there is a need for more coordination and communication between the people who plan and operate electricity and gas networks. 

Q: What role can alternative clean energies, like nuclear or geothermal, play in decarbonizing the energy matrix without jeopardizing the grid’s reliability?

A: There is no winning technology or a single solution when it comes to decarbonizing the energy system but rather a mix of technologies that will allow us to achieve net zero. How such different technologies are integrated depends on many variables; there is no magical formula for all countries to follow. Location, energy consumption needs and transmission infrastructure, among others, need to be considered. The latter, for example, is an area where Mexico needs to prioritize investment to meet the rising energy demand and to have a grid capable of efficiently incorporating different energy sources. 

When thinking about the decarbonized energy matrix of the future, all power production technologies play a role. There are places where certain technologies make more sense than others and that is the reason why all energy matrices should be customized to the energy needs and resources available. Nuclear power is a particular case. This industry has become a part of the political agenda, complicating decision-making around it. However, it is a carbon-neutral and reliable power source that should be considered when working toward decarbonization. The major challenge that traditional nuclear faces is similar to transmission, as this technology also represents a long-term investment with very high CAPEX, making it hard to get funding through the private sector alone. In the past, in many countries, those investments were led by the governments. To incentivize investments in longer-term assets with high CAPEX, the private sector needs certain conditions that make those investments attractive and viable for their portfolio. In the end, all power production technologies, including solar and wind, can face challenges that should be considered in their implementation. 

Regarding reliability, there is a disconnect in how it is understood, as reliability does not refer to an asset by itself but to the system as a whole. The system’s reliability is the result of the interaction of every asset in energy generation, demand, storage, transmission and distribution. Reliability can be measured at a system level in a given moment. However, it is hard to quantify the impact of a single asset on the entire system’s reliability. Improper planning in the integration of new technologies can harm the system’s reliability but with proper planning, new technologies can improve the system’s reliability. In the end, it is not a matter of technology but of the planning and strategy behind its implementation. 

Q: How does SAInt help grid operators deal with renewable’s variability?

A: SAInt allows us to model energy systems, taking into consideration the assets’ variability and impact on the grid’s operation. With SAInt, we help decision-makers plan for different scenarios and investments in these technologies.

encoord is a software company founded in 2018 and based in the US and Germany. The company provides software tools, data and advisory services to help energy stakeholders plan for the energy transition.