The need for Traxis Energy

It is widely accepted that to tackle NetZero the energy industry requires work at the grid edge.

Net Zero isn’t just about building off-shore wind farms, CCS and low carbon hydrogen. These big business initiatives have their place, but consumer-facing distributed energy and the everyday management of commercial and residential energy requirements is equally important, but not yet happening. 

  • Property developers, landlords and owners are facing a major challenge in identifying how to respond to new regulations to remove gas central heating, provide EV charging and meet CO2 reduction legislation.

  • Consumers need to understand what products and services to buy – electric vehicles, heat pumps, solar panels, smart devices, smart tariffs, home batteries, V2G, P2P trading etc. – understanding that is beyond most people.

  • Local peak loads in supply as well as demand requires network strengthening which will be expensive, disruptive and time critical.

Addressing these factors needs to start happening now, which is the driving requirement for Traxis Energy.

We argue that the energy transition is about taking a different perspective: an inverted perspective that focuses on supporting the grid edge. Here multiple investment, control and service decisions need to happen right across customer facing activities. The inverted pyramid shows how the energy system can support the many actions at the grid edge. It inverts the management mindset needed to involve consumers in becoming part of delivering Net Zero.

It is about service not hierarchy.

In particular, Traxis Energy is needed to tackle three specific challenges:

  • There is a major, important market here, yet it is under exploited. Why? Because it is highly fragmented with individual technologies such as solar, heat pumps, evs, insulation, energy efficiency etc. In addition, installation and support services are widely distributed due to low levels of take-up, whilst investment tends to focus on individual businesses not whole market propositions.

    Each element seeks to justify its expense in isolation whereas, by working together, layering costs and benefits to create a whole product, the market could both be consolidated and fully commercialised.

  • The current energy retail model is unsustainable. Several retailers have a negative margin which the recent surge in commodity prices has exacerbated. Markets are returning to a few dominant incumbents and competition is effectively dead. This market has failed, and few financiers will be interested in further investment without a significant change to the business model.

    And yet, the inverted pyramid shows how important this market is and how it is certain to expand.

    Our belief is that the energy retail model must be merged with local generation and both explicit (contracted) and implicit (reactive) demand management. Traxis Energy is about exploring how this can be achieved, assisting energy retailers rebuild and then deliver using local investment packets.

  • Peak loading is a hidden challenge but one that will become clear as ev and heat pump penetration builds. An average home consumes 3,600kWh a year. It has a single-phase supply averaged for planning purposes at around 2kW per property. An electric vehicle is likely to use around 2,500kWh a year and a heat pump on a well-insulated property another 4,500kWh giving a total of almost 11,000kWh per property. With cars needing to charge outside working hours and heating working in late afternoons, evenings and mornings there will be a significant rise in peak loads. An average of 2kW/home will be woefully inadequate. Without other solutions most homes will require a three phase supply and most businesses an uprated supply. This will be expensive, disruptive and will take decades to complete. It will also feed through into higher network tariffs and consequently higher energy costs. A vicious circle.

    Local flexibility can mitigate these effects when applied holistically.