Open Utility secures over £400k funding to develop online marketplace

Open Utility has secured £412,500 funding from BEIS Energy Entrepreneurs Fund (EEF) to develop a new online marketplace for local electricity flexibility trading.

The marketplace will help Distribution Network Operators (DNOs) play an active role in managing local smart grids, which is seen by many as a missing piece in transforming to a decentralised and decarbonised energy system.

With the rapid rollout of distributed renewable generation, storage and electric vehicles, DNOs are facing unprecedented congestion problems on the local network. Open Utility’s platform aims to help DNOs transition into active ‘Distribution System Operators’ (DSOs) that can procure customer flexibility to reduce congestion at specific times and locations.

Ian Marchant, former CEO of SSE and investor in Open Utility, said: “As the energy system evolves into one that is decentralised and decarbonised the role of the local distribution companies will change fundamentally.

“Local and peer-to-peer energy and flexibility markets with play a role in this change and I am delighted the BEIS are sponsoring this key piece of preparatory work with Open Utility.”

Online marketplaces like Airbnb and Uber combine intuitive web design with scalable resource optimisation algorithms to lower barriers to entry and unlock the value of underutilised assets.

Open Utility is leveraging such power of online marketplaces to solve one of the biggest challenges facing the energy industry: enabling DNOs to become DSOs.

The company has built up a track record of innovating on a global scale. The marketplace will join their first product, a peer-to-peer matching service for renewable energy suppliers, which is already operational in the UK, Italy and the Netherlands.

According to a report by BEIS and Ofgem, a smart and flexible energy system could reduce UK electricity generation emissions and realise up to £17-£40bn of savings by 2050.

These benefits come from better optimisation and operation of the system which avoids or defers network reinforcements, avoids generation build, and avoids curtailment of low carbon generation.

In addition, the growth of electric vehicles (EVs) will have a rather big impact on the local electricity network.

Flexibility trading platforms will play a key role in enabling EVs to coordinate their charging schedules with the DSO, so the decarbonisation of transport does not require billions of electricity network reinforcement, which would have to be borne by bill payers.

Local flexibility marketplaces are mentioned as being a focus for innovation funding in the BEIS Smart Systems and Flexibility Plan. With the £412,500 grant to Open Utility, BEIS are demonstrating that they are keen to turn words into action.