Digital Demand-Driven Electricity Networks Initiative

The 3DEN Phase I pilot projects were launched to demonstrate how digitalisation can unlock new opportunities for efficiency, flexibility, and resilience. Projects were selected through a competitive process managed by UNEP, with funding from the Italian Ministry for the Environment and Energy Security and technical collaboration from the IEA.

Selection prioritised initiatives that could provide practical insights across different contexts, including households, utilities, and industry, while showcasing innovative digital tools with the potential to scale. The desired outcomes were not only to deliver direct benefits in terms of energy savings, avoided emissions, and improved reliability, but also to generate lessons for policymakers on the enabling conditions, barriers, and people-centred impacts of digitalisation in the power sector.

In Brazil, rising urban energy demand, greater use of air conditioning, and more variable renewable generation are straining the grid. In the north-eastern state of Ceará, weak networks and extreme weather have led to frequent power outages, sometimes averaging ten hours per week. For households in affordable housing developments, the lack of access to modern energy management tools leaves them with high bills and little ability to reduce demand or respond to grid needs.

The D2FX project was developed by Planet Smart City in partnership with Energy of Things, supported by the UNEP/IEA 3DEN initiative and co-financed by the Italian Ministry of Ecological Transition. It aimed to demonstrate how digital technologies and rooftop solar panels could help low-income households save money, reduce emissions, and provide grid flexibility. The project focused on Smart City Laguna, a new community in Ceará, and targeted 100 households. These homes were equipped with solar panels, batteries, and digital devices that allowed families to monitor and manage their energy use.

Deployment and Actions Taken

The roll-out combined technology with community engagement. Each home received a rooftop solar system, a hybrid inverter, and a small battery. Residents also gained access to a smartphone application that showed their energy use and rewarded them through simple games when they shifted consumption to off-peak hours. A remote monitoring service and an optimiser tool were introduced to help households reduce bills and coordinate demand with the grid.

The project also invested in building trust. Citizen Labs and local meetings explained how the systems worked and encouraged residents to participate. The budget of USD 1.45 million was funded through a mix of international support and company co-financing.

Results and Impacts

The project is projected to generate around 15 MWh of renewable electricity per year, resulting in a reduction of almost 80 tonnes of carbon emissions annually. Each household cut its electricity use by an average of 456 KWh a year. Families reported bill savings of between 60% and 70%. Batteries provided backup during outages, cutting average blackouts by 60%.

Beyond the numbers, the project increased awareness of energy use in a neighbourhood which included social housing. Around 16% of residents actively shifted their demand in response to the digital tools, showing the potential for behaviour change even in low-income communities. 

Lessons Learned

Reliable communication systems proved essential, with long-range wireless networks proving more effective than standard Wi-Fi. Some meters could not handle flows from solar back to the grid and had to be replaced. Habits also mattered: some families switched off their main power when leaving home, which stopped the digital devices from functioning. A lesson was that technology must be paired with clear guidance and community support.

Scalability and Replicability

The approach is highly replicable. With the right financing, such systems could be applied in other affordable housing projects. Costs remain a barrier, and Brazil currently lacks a strong market for demand response. But similar models are already being expanded in India and could inform future regulation.

Colombia’s electricity demand is growing rapidly, especially in the capital, Bogotá, while new power lines are being delayed by years. In 2023, restrictions on the Bogotá network increased by nearly 20% in a single year, resulting in higher costs for consumers. The 2023 to 2024 El Niño reduced hydropower output, leaving the system more vulnerable. In the Sabana Norte area, outages affected over 300 000 customers, sometimes lasting six hours.

The EnelfleX pilot was launched by Enel Colombia and Enel Grids, supported by the UNEP/IEA 3DEN initiative, with technical input from Politecnico di Milano and Gridspertise. Its purpose was to test demand response to relieve congestion and avoid costly new grid investments. Rather than relying solely on new power lines, the project collaborated with large industrial and commercial users to temporarily reduce consumption during periods of stress.

Deployment and Actions Taken

The project installed digital devices that allowed communication between the utility and customers’ equipment. Twenty-one companies signed contracts to participate, covering sectors from food processing to ceramics. Together, they committed 9.2 MW of flexible load, out of a total baseline demand of 12.1 MW.

The companies received payments for being available to reduce demand, as well as additional compensation when they curtailed their operations. Engagement was essential, and many customers valued not only the payments but also the advance warning of potential supply problems, which helped them plan production.

The pilot also worked closely with Colombia’s regulator to inform the design of a permanent demand response framework.

Results and Impacts

The pilot demonstrated that 9.2 MW of demand flexibility could be secured quickly, representing over 12% of local demand from just a handful of customers. This level of flexibility proved critical in preventing blackouts and maintaining reliable power supply. Analysis showed this could avoid over EUR 48 million in transmission investments and prevent outages. Avoiding reliance on diesel backup resulted in more than 2 300 tonnes of CO₂ equivalent in reduced emissions each year.

Lessons Learned

Technical integration was challenging, particularly in ensuring cybersecurity and reliable communication. Payment rates were increased, and participation hours were reduced to adjust customer engagement levels. The pilot highlighted that many companies value reliability and advanced information as much as financial compensation.

Scalability and Replicability

The model has strong potential to scale, especially in other congested urban areas which face similar challenges from rising demand for electricity and constrained local power networks. Success depends on clear regulation, reliable communications, and a supportive market framework. For now, participation is limited to industrial and commercial customers; however, the project demonstrates how demand response can complement new infrastructure.

India’s distribution companies continue to suffer from high technical and commercial losses, often over 20%. In Delhi, many feeders experience frequent imbalances, outages, and voltage instability. Without real-time visibility, utilities cannot easily identify losses or optimise the use of assets. This increases costs, reduces reliability, and makes it harder to integrate new distributed resources.

The Digital Twin project was implemented by Panitek Power in collaboration with BSES Rajdhani Power Limited, TERI, and Venios GmbH, and was supported under the UNEP/IEA 3DEN initiative. It aimed to improve monitoring and efficiency of low-voltage networks through digital models that mirror the physical grid.

Deployment and Actions Taken

The project installed smart meters and sensors on 23 feeders across four substations in Delhi. These devices sent real-time data to the Venios Energy Platform, where digital twin models analysed losses, load profiles, and voltage quality.

Consumer tagging and data validation exercises were conducted, and staff at the utility were trained on how to utilise the digital tools. Demand response features were also tested, with behavioural nudges introduced to encourage load shifting.

Results and Impacts

The project revealed significant discrepancies between measured and billed energy, ranging from under 30% to nearly 50% above the actual use. Identifying such losses provides the basis for corrective action.

Improved asset utilisation enabled the utility to defer transformer upgrades, saving approximately INR 3.4 lakh (USD 4 000) per unit. Additionally, annual revenue losses per transformer could be reduced by nearly INR 12 lakh (approximately USD 14 000). Energy measurement accuracy improved to within 2%, providing confidence in decision-making. Consumers reported more stable voltage and fewer outages, while the utility benefited from improved visibility.

Lessons Learned

Accurate data is the foundation of digital twins. A significant amount of effort was invested in validating feeder and GIS records. Integration with older systems was difficult, and some consumers initially resisted due to privacy concerns. Training was essential to build capacity among staff and consumers.

Scalability and Replicability

The model can be replicated in other densely populated Indian cities facing high losses and unreliable low-voltage networks due to growing demand for electricity and poor visibility of existing power networks. Enabling conditions include reliable telecoms, availability of meter and GIS data, and skilled personnel. Barriers remain in integrating with legacy systems and aligning regulations.

Morocco’s industrial sector is a major energy consumer. At Les Eaux Minérales d’Oulmès, the country’s largest bottled water producer, energy monitoring relied on manual data collection and spreadsheets. With annual consumption of 60 GWh across its two largest sites, Bouskoura and Tarmilate, inefficiencies risked locking in higher costs and unnecessary emissions.

In 2022, LEMO launched a project to digitalise its energy and industrial performance monitoring, supported by the UNEP/IEA 3DEN initiative and co-financed by the Italian Ministry for the Environment and Energy Security. The goal was to improve efficiency, reduce emissions, and build a model for industrial digitalisation in Morocco.

Deployment and Actions Taken

Energy audits identified waste and provided guidance for targeted interventions. Smart meters and sensors were installed, along with two new digital platforms: a system for energy monitoring (Power Studio SCADA), and a system for tracking industrial performance (LineView). These systems were connected so that managers could see both energy and production data in one place. Artificial intelligence tools were added to forecast demand, detect anomalies, and support predictive maintenance. Training was rolled out across the workforce to ensure staff could use the new tools and apply the data to day-to-day operations.

Results and Impacts

The two sites together account for almost all of the company’s energy use. Early results show improved data quality, greater visibility, and faster decision-making. Real-time monitoring and digital optimisation have delivered annual energy savings of more than 3 800 MWh across Bouskoura and Tarmilate, equivalent to an emissions reduction of almost 2 800 tCO2e. Staff have shifted from manual data entry to higher-value analytical roles, while production downtime has been reduced through better monitoring. The project supports LEMO’s target to halve emissions by 2030 and achieve carbon neutrality within a decade.

Lessons Learned

Accurate measurement is the foundation of improvement. Integrating energy and production data created greater insights. Workforce training was critical to adoption, while legacy infrastructure and fragmented data slowed initial progress.

Scalability and Replicability

The systems are being extended to additional LEMO sites and could be replicated across Morocco’s agro-industrial sector. The approach requires skilled staff, supportive policies, and financing for digital upgrades. It provides a clear example of how industrial companies can contribute to national climate goals.

The four Phase I pilots have demonstrated how digitalisation can deliver tangible benefits for households, businesses, and industries, while reducing emissions and enhancing resilience. These initial demonstrations provided policymakers with valuable lessons on the enabling conditions, barriers, and human impacts of digitalisation in power systems.

Building on this foundation, Phase II of the 3DEN Initiative has been launched, expanding the focus to new geographies and sectors. Through a call for proposals in early 2025, projects are currently under review from Brazil, South Africa, Morocco, Tunisia, Kenya, Nigeria, Ethiopia, and Tanzania, with themes that span sustainable agro-food solutions and urban energy systems. Phase II aims to scale up digital tools and partnerships, deepen collaboration with Africa, and accelerate progress towards efficiency, resilience, and climate goals.