The energy market is only getting more complex. “The grid” is actually many power grids that are sometimes haphazardly connected, which makes system-level management harder than it ought to be. Severe weather events are becoming more frequent, testing the vulnerabilities of energy systems and leading to more brownouts and blackouts.

Meanwhile, the industry is dealing with the imperative to go green – to minimize energy waste while shifting away from fossil fuels in favor of renewable sources. There has been much progress with renewables, but the transition has still been fitful. At the same time, global energy demand keeps rising with ongoing industrialization, compounded by the adoption of new power-hungry applications such as electric vehicles (EVs) and artificial intelligence (AI).

Regulators around the world are attempting to keep up with these challenges. Mexico enacted several significant changes in 2018-2021. That includes a set of regulations called the New Network Code (Nuevo Código de Red) that have served as a template for other jurisdictions looking to build efficient power grids. Since Mexico formulated its new regulatory regime, similar regulations were adopted by India, Brazil and the European Union.

The energy infrastructure in the United States is far more mature than it is in many other markets, but the U.S. is experiencing all the same challenges, and U.S. energy companies are adopting many of the tools and techniques mandated by regulation elsewhere.

Here we’ll examine some of the challenges to the grid, some of the regulatory changes, and some of the technologies and techniques that the global energy industry is adopting in response.

Managing new energy options

Balancing energy supply and demand has always required careful management and planning. Production must be carefully scaled up and down to meet immediate needs. Energy companies must ensure sufficient capacity to meet peak demand not only in the present but also in the future.

The growing reliance on renewable sources complicates energy system management. Wind and solar are both intermittent and less predictable. The different renewable options (hydroelectric, wind, solar, geothermal, etc.) produce electricity not only at different rates but also at different voltages.

The industry has responded by adopting more sophisticated modeling, management and control technologies.

Managing capacity is an intrinsic part of energy generation. Of equal and perhaps even greater concern is ensuring that the power is reliable, stable and used efficiently. For developing countries, reliable power is crucial to economic growth. Every watt of electricity is important, so many developing countries are either modernizing power grids or building them from the ground up to maximize resources and minimize losses.

Creating manageable grids

There is a growing consensus that generating and using power efficiently is best accomplished with decentralized though connected systems. This is expected to help make it easier to improve efficiency, decrease losses in power transmission and increase safety and reliability.

Mexico is at the forefront of this trend with its regulations that dictate connecting decentralized power generators to the grid. Its New Network Code mandates that connection or interconnection to load centers of the country’s National Electric System (Sistema Eléctrico Nacional, or SEN) should not negatively affect the levels of efficiency, quality, reliability, continuity and sustainability of the SEN. Aside from ensuring security and safe operation of the grid, these regulations focus on three main areas:

• Establishing connection and interconnection criteria for load centers
• Improving power quality, including power factor correction and harmonic distortion
• Reducing wasted electricity during power transmission

Stability and energy loss

Transmission losses occur when electrical energy is lost due to the resistance of transmission lines during transmission and at converter stations that convert energy generated by power plants.

Electricity from power plants must be introduced into the grid at high voltages of 200 kV to 500 kV using direct current (DC) rather than alternating current (AC). DC is easier to control than AC, which helps with the interconnection of grids that have unsynchronized and inconsistent voltages at power generation plants.

Not only is DC easier to control, but high-voltage direct current (HVDC) systems and voltage-source converters (VSC) lose substantially lower amounts of electricity than AC transmission systems across long distances.

That said, voltage can become unstable across long distances. This instability can damage distribution systems, power infrastructure, transport and industrial equipment, let alone all the sensitive consumer electronics devices that energy customers will of course be plugging in.

Power capacitors and stability

Energy companies can install power capacitors with high current capability in load centers, the panel boards that are the main interface between the grid and a customer’s facility, whether that’s an office building or a residence.

Load centers that are thus equipped are more likely to be compliant with regulations, as they decrease the possibility of significant voltage fluctuations and surges.

Power capacitors may also be used at converter stations, the nodes in power systems that connect one segment of a grid to another. Power capacitors are critical for converting AC to DC, transmitting the power between HVDC converter stations and converting the DC back to AC so that electricity can be fed into the power grid. They essentially ensure the transmission of consistent voltage in the process.

Capacitor banks can also help stabilize the converted DC voltage in the power converter station as electricity is being prepared for long-distance transport. Capacitor banks safeguard and ensure the stability of AC output voltage in the receiving converter station before electricity is introduced into the grid.

Power capacitor solutions enable more remote and environmentally friendly, renewable power generation, providing more efficiency with fewer losses.

Power capacitors and efficiency

Increasingly, power factor, a measure of the effective use of power, is being specified in rules and regulations. Power factor is a combination of true (or working) power in kilovolts (kV) and reactive power in kilovolt-amperes-reactive (kVAR) divided by the apparent power, expressed in kilovolt-amperes (kVA). A power factor of, say, 0.85, means the system is 85% efficient.

As Mexico’s new regulations kick in, it is requiring a power factor of 95%, an ambitious target that would put Mexico’s grid at the forefront of efficiency among global power systems. That figure will rise to 97% in 2026.

As Mexico and other power systems around the world attempt to become more efficient, there is a growing emphasis on power factor correction (PFC), a technique for improving power system efficiency that relies on the installation of banks of power capacitors.

Reactive power represents a draw on the source. PFC involves drawing on the power stored in the capacitors to maintain reactive power levels, thereby reducing or even eliminating the need to draw on the source. The practical result from the standpoint of the power factor equation is that system efficiency is increased.

Harmonic filters and efficiency

Harmonic distortions are caused by non-linear switching of supply voltages, and occur when using power semiconductor devices and rectifier circuits, for example.

Harmonic distortion is a problem for many reasons, not the least of which is that it lowers the power factor. As a practical matter, the customer is using power inefficiently (and ends up paying more for power), also risking damage to the equipment connected to a distorted power supply.

Eliminating harmonic distortion is accomplished by strategically installing harmonic filters. There are several types, including passive filters, active filters and hybrid filters, each with advantages and disadvantages that have to be considered when deciding which is most appropriate for any given power system application.

Decentralization

A decentralized system will reduce the likelihood of widespread outages, as a power outage at one of multiple power-generating sources will have a minimal effect on the entire grid.

The New Network Code sets forth strict guidelines to harmonize the requirements for generation, demand and HVDC facilities that are connected to the grid. There is a requirement for a power factor of 95%, but among the many other guidelines, voltage must range from 105 to 95, and there is a 50% limit on total demand distortion (TDD), for example.

As Mexico decentralizes, it has also created the opportunity for private companies to join the grid.

Mexico’s New Network Code is both ambitious and strict, however, and many power companies are struggling with compliance. This presents a large opportunity for engineers to develop solutions that not only aid organizations to become more compliant but also provide needed energy throughout the world.

Voltage converters

The use of power capacitors solves several issues, but it is also problematic for power systems to store significant amounts of electricity.

The amount of electricity generated and fed into the overall electrical grid at load centers must be carefully matched in terms of voltage, hence the voltage requirements mentioned above adopted by Mexico in its recent regulations. This is also why it is problematic that different renewable energy sources generate electricity at different voltages – the voltages there must also be matched.

This is necessary because inconsistent voltage in transmission can damage sensitive equipment used in hospitals, data centers, universities and by the military.

Voltage regulation is accomplished with HVDC or VSC to provide constant and consistent DC voltage. These converters not only reduce the fluctuations in voltage but also reduce losses of electricity across longer distances.

HVDC/VSC and capacitors

HVDC and VSC systems tend to be used for long-distance transmission because they lose substantially lower amounts of electricity than AC transmission systems across long distances.

Voltage can become unstable across long distances, however, and as noted above, voltage instability can damage customer equipment. Again, power capacitors come to the rescue. They can be used to smooth out significant voltage fluctuations and surges. Power capacitors may also be used at converter stations to ensure the transmission of consistent voltage.

By ensuring the integrity and consistent transmission of electricity, load centers and converter stations that employ such HDVC systems, power capacitors, capacitor banks and harmonic filters can maximize resources, minimize electrical losses and provide stability. In doing so, engineers at both public and private-sector companies can increase innovation, stability and efficiency, while ensuring compliance with Mexico’s New Network Code and to regulations and practices adopted elsewhere inspired by the New Network Code.

Conclusion

It is vital to ensure widespread access to reliable power. This is achievable with consistent transmission of electricity load centers and converter stations that employ the latest HDVC systems, power capacitors, capacitor banks and harmonic filters to maximize resources, minimize electrical losses and provide stability.

Developing countries may have greater latitude to implement ambitious power system regulations and innovations largely because they are still building their electricity infrastructure.

The United States, the UK and Canada have more mature systems that are harder to modernize given the preponderance of legacy infrastructure they all rely on. That said, in many places, national grids interlock. There are benefits to thinking about regional power management where the regions don’t necessarily map to national or state boundaries, and even mature markets will want to modernize, improve their operations and participate in regional power management schemes.

There are multiple solutions to address the requirements of new and evolving regulations and practices, including power capacitors, harmonic filters, power factor correction inductors, surge protection modules, reactors, and passive and active filters that assist engineers in creating compliant solutions.

Providing reliable power is achievable with consistent transmission of electricity load centers and converter stations that employ the latest HDVC systems, power capacitors, capacitor banks and harmonic filters to maximize resources, minimize electrical losses and provide stability.

Energy markets will continue to evolve. Consequently, issues such as decentralized multiple-source power and voltage stability and power loss will remain prevalent as governments and private stakeholders work to bring reliable access to electricity to a more stable grid.