Episode Transcript
[00:00:10] Speaker A: Welcome to the EU Energy Projects Podcast, a podcast series from Enlida and France focusing on the clean energy transition for the European Union and the EU Commission funded energy projects that will help us achieve it. My name is Aretid Daradimu. I am the editor of the EU Energy Projects Podcast and your host.
In this episode I'm joined by Duncan Gibb and Mochaba Kamarlui from the F6s cluster. We're going to focus on the cluster's projects such as We Forming Digi Wind Hedge, IoT Inferno and Clin Hypro, exploring how AI data and regulation are shaping the future of intelligent grid forming buildings and Europe's energy transition.
Gentlemen, thank you very much both of you for being here with me today. Muchaba, I'm really apologizing for, for any mistake in pronouncing your name and I would like to start by asking both of you, let's, let's start with a bigger picture. What Role does the F C6S cluster play in supporting projects like we forming and connecting innovation across Europe? Danke.
[00:01:32] Speaker B: Well, we are part of the F6S cluster through the weforming project and what is very exciting about weforming is that it takes six demo sites across Europe.
I won't try to name the countries right now under pressure, but works on the technical proof of how to, how to build up intelligent grid forming buildings. So this is taking partners across Europe among 20 institutions. I think we are over this three year project to look at some of the barriers to building up these, these type of buildings and to prove these on a technical scale. And so Mojtaba can talk a lot more about the technical aspects of things. I've been working on the regulatory side and I find this personally very exciting because I think that figuring out how we can use our energy in buildings in a more intelligent way is really the future of how energy is going to be used in Europe where buildings do not be, are no longer just energy consumers but they produce, they support the grid, they're flexible, they're assets in the energy transition.
So I think that these type of projects are really key to help make connections across institutions and build knowledge that will help roll out these buildings.
[00:02:51] Speaker A: Mutsava, do you have something to add?
[00:02:53] Speaker C: Thanks, thanks Duncan. Actually you gave it very nice picture and also thanks Ariti for the invitation.
Basically the role of F6s cluster as well as the sustainable energy hub here is. You know, as Duncan mentioned, we are talking about resolving a big problem here in terms of the energy resilience for the Europe, and considering the current situation in the climate change, as well as the geopolitical issue of the energy pricing and things, these innovation projects are kind of European tickets for the innovations for the deep techs, in order to join together and propose something really and deploy something innovative. But at the end of the day, communication with the different stakeholders is really, really important and how we really communicate the impacts, the innovation here that the project is going to bring to the market is very important, especially for the end users and F6s sustainable energy hub, they are doing this kind of communications in terms of podcasts, in terms of LinkedIn channels, in different channels that usually the end users listen to our outcomes.
[00:04:08] Speaker A: Absolutely. Not to mention that the Commission also promotes a lot this kind of initiatives, the clusters, collaborations, etc.
Correct me if I'm wrong, but your work highlights the growing importance of building energy data. This is how I understood it at least. Why is digitalizing this data such a turning point now?
[00:04:30] Speaker C: This is a very important question. You know that the time that we are living now, it raises the question of action to some important things, like climate change.
And basically you Europe created a framework that connects our impacts and our actions into finance. So basically everything here, every point of consumption, every point of saving, the data around our buildings and assets, especially big organizations, corporates, should be auditable. It should be possible to review improvements, set KPIs on top. And for this purpose, we really need to digitalize everything. We cannot stay in the excel sheets or PDFs or like very unstructured systems to manage our data.
And in the other side, actually I can give you an example of the European grid and energy. We are living in a moment. That grid is almost very well digitalized. The European network of electricity is listening and talking to the consumers and producers of energy in a minimum of like around 15 minutes. So this is like, you know, the way the grid expects us to report, to mention what we are doing and actually interact with the grid. In this case, we cannot actually. And the energy managers, the end users, they cannot actually do it, like combine a lot of data together in even in everyday work and communicate it in the right way with the grid. And this is where if they don't do it, some people are still doing it in some places. But if we keep doing this, if we keep communicating in a traditional way, not digitalized way, we will lose the opportunity on optimization, on improving our performance, especially when there are other stakeholders and there are other machines and systems that need to understand our data.
[00:06:44] Speaker A: And what about from a policy Perspective. Duncan, are frameworks in Europe keeping pace with this data driven shift in buildings?
[00:06:53] Speaker B: Well, I think they're trying to set the playing field and there's many, there's a few different types of frameworks that are looking at this. There's obviously the EU Data act, which with respect to buildings particularly there's the Energy Performance and Buildings Directive, which sets ambitious standards in many ways. And largely we need to start seeing more implementation from the member states. I'm of the view that a lot of the, that some of the playing field setting has been done in a mostly good way by the European Union and now it's really time for the member states to, to step up and start with the implementation. So the EPVD implementation deadline is even this month coming up, so that's a big signal for them. So largely I think there's no revolution needed. I don't think in terms of the frameworks here, it's more that they need to start putting into place. Where I do see some limitations is on the practical side. Mojtaba talked a little bit about this already, but the lack of data overall is kind of a concern. So we see in some countries across Europe there's very few smart meters and some we see about 99% smart meter penetration. But in others such as Germany, there's a lot of still analog solutions.
So to what extent, how do you address this? Do you scale up the rollout of smart meters, which is already a requirement, or do you figure out a different way to meter energy use, such as in devices and things like that, which is increasingly becoming possible?
So that's an issue. There's also questions around data ownership. So who owns this data? I mean, is it the household? We have the GDPR that protects personal data. If you're a business running, let's say, a shopping mall, who actually owns the data? To what extent does the energy company have ownership of this data? These are sort of questions that I think need to be clarified. This is getting a bit off course maybe, but on this point too, on the data ownership, I have personally quite a big question mark in my mind about public interest in actually using this data. So when you talk about ownership, we say, okay, the data lies with the individual, they have the rights over it. But to what extent do people actually care about using this data in an energy productive way? I'm a big data nerd, right? A big energy nerd especially. And so I'm interested in this, but I know through my personal life that family and friends, not so much and they just Kind of want things to work and be cheap, be reliable. So what kind of public interest is there in engaging with this data and how do you reconcile that with the ownership question?
Maybe these are things that, perhaps there is future frameworks needed to help deal with that. But those are the things that come to mind for now.
[00:09:37] Speaker A: Yeah, absolutely. And from what you say to me, some ethical also dilemmas and ramifications come into mind, especially when we talk about data ownership and whether one individual should prohibit the well being the masses, let's say, if such, if said data can be used for the better good or for the greater good, as we say. Of course, these are not dilemmas that we're going to discuss or solve in this episode. So, staying a little bit on the concept of intelligent buildings and Mojtava, I wanted to ask about reforming, particularly now it introduces the concept of intelligent grid forming buildings. What does it actually look in practice? Because it's nice to discuss in general like, like we do, but we need to see it in action, especially if we're going to, to discuss ethical dilemmas that come along.
[00:10:32] Speaker C: Okay, very, very, very interesting actually. Yeah, this is a very practical question in my opinion.
I can give you five, six examples from the demos of.
But I may stay a bit short just giving you the picture that we have here in the Portuguese grade forming building, the demo that we are currently managing in Portugal. So imagine as an example, imagine that there is a shopping mall in a district, in a region, in a district, and then there are families around these and houses around these shopping malls in a summer, in a hot summer day, in a traditional way, usually the shopping mall itself is a big, let's say push and a big load for the grid together with the families. Especially when it's an afternoon, it's 40 degrees here in Portugal and everyone is going to turn on the AC in the idea of the grid forming building.
The energy manager in that building is aware of what's going to be the temperature tomorrow, how many occupants I'm going to have in this building.
And I'm fully prepared for that tonight when the grid is, when the grid is low, tariff, the cost is low. Tonight I will store the cooling power of the building in terms of ice in a system that I purchased as an ice storage system.
And tomorrow, in the peak time of the tariff and in the hottest time hours of the day, I will cool down the building using the ice and turning off my cheaters in the building.
So this already means that for a few hours, or at least like starting from 15 minutes to a few hours, my building will disappear from the grid. I don't exist. I shut down my chillers, which are equivalent to the consumption of 800 houses.
And all the occupants, who are basically people in that neighborhood are enjoying the best hour of the day in swimming pools in my shopping mall. They are spending time with the family, eating, shopping and they are enjoying a very comfortable temperature.
And the great warming building actually goes behind this. So one step more.
The building is intelligent enough that intraday during the day it beats this amount of flexibility. Turning off the chiller, it sells this flexibility to the grid and the grid is able to respond it with a yes or no. So I'm going to purchase your offering, your flexibility offering and I'm going to pay you for this. So the energy manager, the building owner, the shopping mall owner is earning money, generating revenue. People are enjoying the time without adding more loads to the grid.
And the grid is also happy because the load is reduced. The demanded flexibility is already offered and everything is looking in this way. So this is the reality of how a grid forming building, a smart grid forming building, looks like in the real world.
[00:13:55] Speaker A: What you described makes me think that the building becomes the center of the whole thing.
It is an active player.
So immediately the question that comes to my mind, Duncan is doing current regulations even recognize buildings as active players in the energy system or are we still thinking of them mainly as consumers? Because if the latter, then that comes directly into opposition with what Mo Jabbas just, just narrated for us.
[00:14:28] Speaker B: Yeah, and I love his narrative too. I think it's really, it's what I see personally for the future of how buildings work. And there's such a heavy draw on our energy load that being able to use them flexibly is key. Look, we, it's piecemeal. Like there's parts that are, that are well defined. I'll give you a couple of different examples. But there are also the fact, the reality he's describing, like what is an intelligent grid forming building does not exist in legislation. So there's no kind of legal definition for what this is. There's no definition for how, what different roles people play regarding, as I mentioned kind of data ownership. This whole kind of concept of an igfb, if I could use the acronym, needs to be defined legally. And so that's, I think one of the regulatory steps that can be taken.
So that's the first thing I'll say and just before I get on to the other kind of aspects that are already being addressed or the regulatory parts that are already in place about implementation. I want to talk a little bit about some of the broader issues related to how buildings can be used smartly. One is that we need to improve the energy performance of our building stock.
That with the level of leaky buildings that we have in Europe in the existing building stock, it's not really going to be possible. And why? Because if you're asking someone to, to not heat for a couple of hours during, during a crunchy sort of period during the winter, they're going to be in big trouble if their, their temperature drops by a couple of degrees within those two hours. On the other hand, if they have a well insulated building, they can, they will hardly even notice it. So this is kind of an essential necessary criteria for that. Another one is to deal better with energy prices, energy taxation. We still have electricity that's, that's too expensive in Europe relative to fossil fuels. If we're, we're talking a large part about electrification here, right? Like maybe there's a role for molecules in this, but we're talking about electricity being used across these different energy consumers. So that's another thing. And on that point we need to, we need to pick up steam with electrification technologies in general. We just saw this week the European Heat Pump association announced that compared to the first quarter of 2020, heat pump sales are up again about 13%. But we're still kind of well off the 60 million stock target that the European Commission has set in its scenarios for 2030. So those are kind of three necessary criteria for IGFPS to even take off at all. Now what's, what's already in place is, is we have regulation in the EMD about flexibility markets that countries should be establishing them, but we're lacking on the implementation.
So I was just reading last week the Smart N, it's the Flexibility Report 2025 Market Monitor on demand side flexibility. And they say that Europe's challenge right now is not a lack of rules, it's a lack of delivery. So we need more of these flexibility markets to be put into place where people are actually able to, as Mujtaba was describing, sell their energy savings essentially is what they're doing. They're saying I won't consume during this period and this is how much it will cost.
So that type of thing needs to be used to be put into place.
We need more smart meters as already mentioned. And finally, one other thing that could be scaled up in the member states is more financial incentives for developing IGFBs. I mean the subsidies and tax credits Things like that could help establish business models where these could work better. Right now it's a lot of people trying to sort of sandbox them and the conditions for good business models is not really in place yet.
[00:18:16] Speaker A: At this point I would like to throw in the word interoperability because it comes up again and again. And with what we have discussed so far, I can't even wrap it around my head how everything would work without interoperability.
So my question is, why is it still such a persistent bottleneck? And despite years of discussion, where do you think that is the case?
[00:18:41] Speaker C: The explanation around interoperability is not very easy, but I try to make some examples.
When we put it in the domain of igfp, which is intelligent grid forming building, there are a lot of AI assets involved, a lot of optimization systems, a lot of machine learning models, systems that need to work autonomously and in a planned way. In this case, let me give you an example about the AI that basically has no context. So imagine that you just open your Gemini or ChatGPT and you start asking like I have a stomach ache, what should I do? And then like the answer would be basically very generic and not useful at all. It can be like, okay, you can right away go to the doctor.
In the intelligent gate forming building, there are a lot of systems that need to have enough context and they should understand each other and they should talk to the same language. Basically this is the interoperability we are talking about.
Imagine that we just talk about the temperature, but the system doesn't know that this is the temperature from a chiller. The chiller has this power capacity.
It works in the time zone of Portugal. You know, all these formatting and all these processes that each system is defined by, the context does really matter. When the grid, for instance, is talking to a technology, to an optimizer or to a real time controller. Here it really matters to have the full picture and full context.
But then returning back to your question, why it's still a big issue? It looks to be a big issue. It's basically like there are a lot of vendor lock in and there are a lot of systems that are different naturally within each other.
The energy aggregator, those who install the system and build the intelligence and the monitoring system of your building, they usually use different type of solutions from different providers.
There is a chiller from Schneider Electric and energy analyzer from Siemens. Another thing, and I don't want to mention all the technologies available, but like, you know, there are several hundreds of devices in a commercial building and when each System has its own parameters and definitions and when they are going to work together in a harmonic way and when you are taking the data out of the building and returning back some comments and actions from outside into the building.
So the problem is like there are a lot of systems that are not harmonized and they are not talking to each other in a harmonic way. And the role of aggregator is getting more and more complex in order to translate these systems into the understandable messages at the end.
And yeah, this is not yet resolved. So we see that there are still efforts on defining, let's say libraries and defining ontologies in order to make every, let's say, centralized manner of communication between the devices and systems. But yeah, there are a lot of things that still need to be done.
[00:22:16] Speaker A: Yeah, I would like to go a little bit back to the example that you, that you offered us and ask you Duncan, are there regulatory barriers that specifically limit the deployment of AI driven solution solutions in buildings?
[00:22:32] Speaker B: Not specific barriers. I think that AI is sort of regulated a lot horizontally across a number of different European regulations. It's not really my area of expertise. But you know, digging into it a little bit, we have obviously the AI act, but that's looking very what you would call sort of high risk areas.
So I think in this example, if you were a hospital, for instance, you would want to make sure if you were deploying an AI system to control your heating, your ventilation, this was very secure. There may be barriers to that, but I mean, there's different kind of network and information systems regulations that I'm not very familiar with that, you know, control this to some extent.
There's gdpr, which may be related to AI. If you're sending, you know, some of your building data to OpenAI, for instance, there may be some kind of limitation to that.
But there's nothing in the regulation that specifically prohibits using artificial intelligence in buildings.
It really would depend on the building itself. It would depend on the context.
But to my knowledge, as I said, I'm not really an expert on this.
[00:23:44] Speaker A: Yeah, absolutely. But everything again would make sense if buildings could become active market participants like we forming suggest.
Mustafa, how realistic is that today?
[00:23:58] Speaker C: Yeah, actually it's pretty real nowadays in the Portuguese energy market, if you have a building that you can manage and you can basically, you know, that you have a flexibility to offer. You have a system like a battery storage system or thermal storage system and you're sure that you can, based on the regulation that I'm not expert of, but according to the regulation defined by the dgeg, which is a local regulator around the energy market and participants. So if you well match with this situation, you even today you can offer a flexibility for the day ahead, market for tomorrow. And this is we are talking about like buildings can offer the flexibility and generate revenues in a regulated way. So this is pretty real in terms of technology.
In terms of adaptation, I have a bit of doubt because adaptation we are talking about like do the stakeholders understand the regulation or understand the technology enough in order to really purchase it or integrate it into their building. Duncan made a very good example of hospital.
But hospital is a very critical environment and it can also have some seasonality and offerings in terms of flexibility. But even a shopping mall, even a restaurant, a retail store, do they take the risk of putting themselves into this environment of like making like. Currently they are adapted to the automated, let's say routines of building management system, turning on and off the lights and things. But are they ready and do they accept putting themselves into such an initiative? At the moment this really needs some examples. They need to see more and more examples of like V forming like demos in different countries in order to understand okay, this was the risk they mitigated. They needed this technology, we still don't have it. So we need to and they understand the ROI return on investment of this process.
And then we can talk about okay, this is real and this is a realistic plan for different European countries.
Some are easier to adapt because their regulation is a bit more advanced, the market is a bit demanding and pays better. But in general the bottleneck that I see is adaptation of the end users and stakeholders.
[00:26:37] Speaker A: And Duncan, your thoughts are current electricity market designs, for example, ready to accommodate flexibility coming from buildings.
[00:26:44] Speaker B: Largely these frameworks are in place. We're talking a lot about implementation for some of the most critical points that underline kind of the foundation of whether IGFPS can be active.
But we still have some ways to with defining legally what is an igfb. As I mentioned the electricity market design for instance, we talk about this in one of our deliverables for the project doesn't establish roles for active consumers or aggregators. Even so even on that level we need to have a better legal basis for that.
The Smart End report I've also mentioned digs into this and shows largely it's a case of implementation. But we have countries where they have even flexibility markets that are commercially largely inactive or they sort of have high entry barriers like you need a certain minimum bid size to take part in them, which maybe if you're a shopping mall is Possible, but if you're a small community or a single building, then no. And on that point too we also need kind of more advancements on establishing the concept of community energy in these things, in these frameworks so that, that you could actually have a community of homes, for instance, that creates their own bid, that participates in the market with like a neighborhood, for instance, not just large buildings or not just the private sector, let's say also regular citizens.
[00:28:14] Speaker A: Gentlemen, we are approaching the end of our discussion, so for the finale I would like to ask you the same question. If you had but one thing that you could request from the European Commission for the shaping, let's say of the future, intelligent buildings, what would that be? It can be technical, it can be regulatory, whatever you, you think mod. Saba, would you like to.
[00:28:39] Speaker C: Well, yes, maybe I can basically echo again like the, the part of the interoperability. So where we really need some actions is to really go through this vendor lock in and reach to a very, let's say standard method of data sharing and interaction between the systems, especially when it goes to the hardware providers and into the system providers and the way that they open the data to the other systems and enable others to also interact. So this is where mostly the industries, the big stake exists, the industries and commercial sector, where as Duncan also mentioned, for instance in Portugal there is a regulation of the minimum bid of 1 megawatt in a market time unit in 15 minutes. So this offering mainly can be done by the industry or by the commercial sector at the moment. But we are talking about the super complex buildings, super complex assets and still the systems are managed in a, let's say completely legacy way. People are not yet trusting to open it to the others. The sellers are mainly. The core here is like, okay, your system is super locked in and nobody can enter. So. And you know there is a conflict here that if you're going to open it to a third party as a, let's say, balancing market operator or something similar, we need to have a way, a secure way. And the security is also important here very much that they can speak to each other, the systems and they can act upon the request. So that's where I believe it's important to do some action.
[00:30:35] Speaker A: Absolutely makes total sense. Duncan, last thoughts?
[00:30:39] Speaker B: Yeah, great answer by Mujtab. I think if that happens we can go a long way and to support that technical vision, I think that I would love to see IGFB's intelligent grid forming buildings be defined in law.
So it's clear not only to those who operate larger buildings who have maybe a profit motive to do so, but also those who just want to have their home or be part of a community that can have their building, work intelligently with the grid and support the energy system.
I think that that's, that would be fantastic. And so, you know, that's a definitional thing in the law. But also we need more digitalization period. So that means we need these countries that are lagging on smart meter rollout to pick it up. We need more devices that are maybe have meters built in and are able to, to take care of that on that side.
We also need more kind of. Sorry, I'm just listing many things, but there are many things. So we need more dynamic as well. We need more incentives for people to look at shifting their consumption or signing up their system to an aggregator or a network that will control it for them for that to happen. I think that the we forming is a great project because it demonstrates that these things work.
We need to build more public trust. That's something we haven't talked about too much. But that public trust is needed to allow people to open up these buildings, as Mujtaba was saying.
So I think that with that short list, maybe we'll get somewhere.
[00:32:08] Speaker A: Absolutely.
Well said. Mostaba Duncan. Thank you both very much for this interesting conversation.
[00:32:15] Speaker C: Thanks.
[00:32:16] Speaker B: Thank you.
[00:32:19] Speaker A: You've been listening to the EU Energy Projects Podcast, a podcast brought to you by Enlit and France. You can find us on Spotify, Apple and the Enlit World website.
Just hit subscribe and you can access our other episodes too. I'm Aretita Radimo. Thank you for joining us.
