Systemic risks in electricity systems: A perspective on the potential of digital technologies. (May 2022)

• Record Type: Journal Article
• Authors: Körner, Marc-Fabian; Sedlmeir, Johannes; Weibelzahl, Martin; Fridgen, Gilbert; Heine, Moreen; Neumann, Christoph
• Is Part Of: Energy policy. Volume 164(2022)
• Publication Date: 2022-05
• Subjects: Blockchain -- Energy informatics -- Privacy-enhancing technologies -- Renewable energy sources -- Self-sovereign identities -- Systemic risks; Energy policy -- Periodicals; Politique énergétique -- Périodiques; Electronic journals; 333.79
• DOI: 10.1016/j.enpol.2022.112901
• Languages: English
• ISSNs: 0301-4215

Abstract

Abstract: In the last decades, several developments have transformed electricity systems in Europe towards liberalized and decentralized systems that are coupled inter-sectorally and inter-regionally. These developments have yielded various significant benefits, such as increased efficiency and robustness. However, we argue that they have also caused new interdependencies and complexity with a corresponding increase in associated systemic risks, e.g., local failures may spread faster and more extensively throughout the system. In this paper, we illustrate how systemic risks may arise in European electricity systems by discussing three exemplary developments. We also discuss the decisive role of the digital transformation that, on the one hand, speeds up the transition of electricity systems and challenges electricity systems' stability through rapid change, but on the other hand may also provide solutions to tackle systemic risks. We argue that, especially in a strongly interconnected world, policymakers must implement a global perspective on these critical and increasingly complex systems, requiring adequate cooperation with respect to data. Using an exemplary case from Germany, we finally illustrate how an intensified data exchange may help to address systemic risks. In this context, we draw a perspective on the potential of emerging digital technologies, like self-sovereign identities, blockchains, and privacy-enhancing technologies. Highlights: We illustrate how some systemic risks in electricity systems have increased. We argue that an intensified data exchange (DE) may help to reduce systemic risks. We draw a perspective for decentralized and privacy-oriented DE. We introduce emerging digital technologies for DE to electricity systems.