Unlocking the value of flexibility for networks
As flexibility procurement becomes a crucial tool for Distribution Network Operators (DNOs), energy users are presented with a new opportunity, writes Andrew McKenna, Commercial Manager at Northern Powergrid, who is leading the development of the company’s flexibility services implementation.
Supermarkets require a consistent electricity supply so that the refrigeration systems stay on and the food doesn’t spoil. For the local DNO, this would traditionally mean granting a connection to a consistent supply of power while maintaining the safety and reliability of the local network. But now, as DNOs begin their transition to Distribution System Operators (DSOs), they are looking for more intelligent ways to work with energy users. By working with energy users to flex their demand profiles, they can help to balance peaks and troughs in the local power system and deliver a more resilient, cost effective and decarbonised network for their local communities.
For a supermarket, this could mean being paid by the DNO to safely turn down its refrigerators for short periods during peak demand. Or, for a site with flexible working hours, such as an industrial site, this could mean shifting intensive power use away from times of high demand on the local network. Finally, for a site with onsite generation and storage – perhaps an industrial park with solar panels on the roofs and an energy storage system – this could mean selling spare generation to the grid or even taking power from the network during times of low demand. This may be during a windy weekday afternoon, where most people are at work but wind turbines are delivering high levels of capacity. Storing electricity in batteries during these times will ensure that the valuable, clean electricity isn’t wasted.
Delivering a deep and liquid flexibility market
At Northern Powergrid, we’ve launched a new customer-led flexibility strategy to work with large energy users (or aggregations of smaller users) in our region to provide extra value from their energy assets and manage the network in the most cost-efficient manner. This means exploring different options to meet the increasingly complex demands on the network. In particular, using customer flexibility to benefit the energy system where this makes sense, compared to other network intervention options. In the long term, we want to foster a deep and liquid market for flexibility.
We are committed to openly testing the market for flexibility solutions as an alternative to network asset solutions such as reinforcing our network. In phase 1 of this new programme, we are focussing on conventional network reinforcement projects of significant cost, but we will also market test flexibility solutions to ensure we deliver the most efficient project for less costly projects where we believe there are viable options.
Over time, as technology develops and capabilities grow, we will continue to grow our use of flexibility as a solution to network constraints. We have forecast the potential for additional capacity as a result of changing customer energy use, and are currently assessing the flexible capacity connected to our network and how these assets could respond to requests from us to adjust usage. This flexibility could come from commercial generation and domestic solar panels; batteries and electric vehicles that can import or export energy; and customers with the ability to reduce the amount of energy they are taking from the network.
This activity is the cornerstone of our transition to DSO and will enable us to deliver a more flexible, affordable and cleaner grid for the 8 million customers across 3.9 million homes and businesses in the North East, Yorkshire and northern Lincolnshire.
Minimum requirements for phase 1
- For a site to provide flexibility it must be located in the relevant position on the network – this includes voltage level and geographic location.
- The asset should be able to reliably adjust its demand import (against a predetermined baseline) or generation export safely and manage this for the duration of a contracted window.
- Providing flexibility must not trigger the participant to breach any other contractual agreement the site may have in place e.g. breaching connection agreement.
- Minimum size of flexibility available must be 100kW (note this is flexible capability not site capacity). If assets are being bid in as an aggregated portfolio, the minimum portfolio size should be 200kW.