Grid-forming inverters are a key technology for an energy system with a large share of renewable energies. In future, they will be able not only to feed in electricity, but also actively stabilize the grid through quick reactions to frequency and voltage fluctuations and through supplying power system inertia.
In this interview with Michael Krappel, Head of R&D, Volker Dietrich, Product Lifecycle Manager and Jonathan Ritter, Development Engineer Certification and Test Automation at KACO New Energy, we discuss the market today, the role of regulatory requirements, standardization and cybersecurity and why these inverters have changed from passive frequency converters to active grid components.
Where does today’s grid-forming inverter market really stand – is it still in the pilot phase or already in widespread rollout?
Michael Krappel:
The market is really taking off: We are seeing more and more projects and use cases, even if it has not quite reached widespread rollout. The speed of adoption varies from region to region. It is important to note that grid-forming inverters are no longer just an academic discussion – the market is increasingly driving demand.
Volker Dietrich:
Our experience confirms this. We completed a research project just over a year ago where we tested grid-forming functionalities not only in the lab, but in the field too. In our view, when it comes to scaling up, regulatory requirements are the most important factor.
Jonathan Ritter:
At the European level, the updated Requirements for Generators 2.0 (RfG) will establish the first regulations for grid-forming capabilities. In Germany, progress is moving faster in some areas: For extra-high voltages, the VDE-AR-N 4130 standard already addresses grid-forming capabilities, and there are discussions about also including high and medium voltages. The Bundesnetzagentur and transmission system operators are the main proponents of this because they would like new installations to be designed from the start in a way that means they do not need expensive upgrades later on.
Jonathan Ritter:
For high voltages, grid-forming capabilities are clearly coming, and they are expected to become the standard. For the low voltage range, especially in the residential sector, the situation is a bit more nuanced: Many countries still have requirements for islanding detection, which may be incompatible with grid-forming capabilities. In principle, inverters need to react to frequency and voltage changes more quickly and more independently. Meanwhile the power system inertia market is being established so that the provision of capacity and balancing reserves is becoming profitable.
Jonathan Ritter:
Energy storage projects will be a major driver. The number of these projects is on the rise and with increasing sizes, grid-forming capabilities become more attractive for both customers and grid operators.
Michael Krappel:
This does not just refer to small residential storage systems, but also to large battery energy storage systems, or BESS. These types of systems can react specifically to grid requirements and provide system services.
Volker Dietrich:
We see a lot of potential in battery inverters, which supply power system and grid-supporting inertia. Backup functions provide another important use case. Pure stand-alone systems are not our focus at the moment; instead, we are looking at secure operation during power grid failure or in critical situations.
Michael Krappel:
Furthermore, large renewable energy parks, such as solar or wind parks, increasingly need such capabilities, which means that inverters need to do more than just feed in electricity.
Jonathan Ritter:
For a 24/7 energy supply with a high share of renewables, stability, load management and power system inertia are key issues. Batteries have to be charged and discharged in a way that makes sense, peak loads have to be reduced and grid events stabilized. Grid-forming inverters can help to reduce the impact of critical grid events, for example during extreme frequency changes or grid segmentation. They react more quickly and can act as a buffer against fluctuations within the system. In the case of a backup being needed, they can disconnect installations from the grid and contribute to local continuation of supply.
Michael Krappel:
First we need clear standards, like the VDE-AR-N 4130, to provide the much-needed guardrails. However, such standards need to be applied more consistently and more widely. At the same time, cybersecurity is becoming a big topic; the more inverters contribute to grid stability, the higher the requirements are for safe operation. When it comes to the market, the key is that system services are measurable and billable. The technologies needed for these services already exist or will soon be ready, but the assessment of their financial value is not yet clear.
Jonathan Ritter:
There are already market mechanisms for power system inertia. The actual grid-forming function itself is a more difficult matter; it being a regulatory requirement does not automatically make it billable. It is also important that grid operators, especially in the distribution system, create standardized rules. Project planners and manufacturers need planning certainty in order to avoid double certification or development costs.
Jonathan Ritter:
Some pricing and tendering mechanisms for power system inertia are already in place. But the market is still in its infancy, and its long-term viability remains to be seen. Grid-forming capabilities as such will be required in future, which will not necessarily allow them to be billed separately. This is why we need clear regulatory guidelines and standardized connection requirements, especially for high and medium voltages.
Jonathan Ritter:
With a higher proportion of renewable energies, the significance of inverters for the energy system’s stability also rises, automatically making cybersecurity more pertinent. An attack on a single device does not have the same impact as an attack on several system-relevant inverters.
Michael Krappel:
I would also like to say that large battery storage systems in particular can supply huge amounts of energy. If these systems are mismanaged, it could significantly impact the grid, so security strategies need to be part of the plan from the get-go.
How is the competition between grid-forming and grid-following inverters changing? Do grid-forming systems still have financial disadvantages and how do project planners decide which to use?
Michael Krappel:
Further development strongly depends on standardization. If grid-forming capabilities are made mandatory, inverters will have to fulfil these requirements. This will apply to all market players. As far as costs are concerned, this will incur additional development costs, especially for software and control engineering.
Jonathan Ritter:
If there were to be stricter hardware requirements, like overload capacity and robustness, that of course would be reflected in product costs. Certification costs would also have to be added, especially during the transition when grid-following and grid-forming variants might have to be controlled at the same time.
Volker Dietrich:
Project planners will gear their planning to the specific use case. For example, the focus could be on backup functions or on systems with multiple parallel inverters, which are able to supply higher capacities in off-grid or battery-backup operation.
Michael Krappel:
Power semiconductor devices have been evolving continuously for years, with improvements in terms of footprint and thermal characteristics. But this trend has been happening not just in grid-forming technology, but also in other technological areas.
Integrating sensors, diagnostic functions and predictive maintenance into grid-forming inverters is becoming more and more important. It is crucial to have better operational monitoring of devices and easier repair management. When it comes to software, robust control algorithms and cybersecurity are the focus. Inverters must be resilient to grid events and operate reliably. To ensure that devices can cope with future requirements, upgradeability is becoming increasingly important.
Jonathan Ritter:
Inverters will change from being rather passive frequency converters that follow the grid and feed in electricity to becoming active grid components. They will take over more system management tasks, interact with the grid, the market and electricity producers and contribute to grid balancing.
Volker Dietrich:
The presentation will explain where we currently stand with grid-forming inverters and how the market is developing. We will be talking about the importance of power system inertia, future requirements faced by inverter manufacturers and the role of products that enable this.
Jonathan Ritter:
We will also show why upgradeability will become important. The industry is currently transitioning from grid-following to grid-forming inverters. Manufacturers need to be prepared to adapt as soon as new requirements become mandatory.
