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NETWORK / 19 / JUNE 2019 and cheaper electricity system; as well as giving consumers more choice in buying and selling electricity and flexing their electricity demand," she adds. "However, this model of electricity trading and network operation differs significantly from the way in which the UK electricity system has operated to date. Markets and network operation have historically been designed to reflect the 'conventional' centralised configuration of the system, rather than supporting smaller scale, more active local participation and despite changes currently being made to en - able integration of virtual power plants into established markets, this largely remains the case." Bray argues that changing market rules around reducing the length of the trad- ing period, which is currently undertaken in 30-minute blocks, and reducing the minimum load size of 1MWh would help the roll-out of more virtual power plants. "Shorter time periods would expose more volatility in the markets and therefore more value for VPP participants; whilst reducing the load size would mean that less aggregation of small-scale generation would be required to meet market requirements," explains Bray. "In addition, more market opportunities at the distribution level would allow for a wider range of local service propositions to emerge. However, although trials are currently taking place with several of the DNOs, these are at present limited in both offering and take-up. "This needs to change in the next few years if we are to meet our carbon reduction commitments on time. This will also require a change in behaviour for energy customers – traditionally customers have been seen as passive consumers, at the end of the value chain," adds Bray. Data exchange Chris Pritchett, the head of energy at law firm Foot Anstey says one of the big benefits to come out of the various trials which are taking place both in the UK and abroad are new data exchange platforms, which are being developed to manage the different technologies and measure any benefits from using them. "We will be able to put a number around those benefits and say we have saved this much money and carbon, and also that we have built a decentralised approach to our generation portfolio that is far more resil - ient than 14 major power stations along the National Grid network. "We are in a world now where DNOs only know about 20 per cent of what is on their system, and as the number of electric ve- hicles (EVs) starts to grow, that percentage will decrease, because people will not know what's on the system, either at a national or a distributed level." Pritchett adds with more renewable energy coming onto the grid, balancing will be done more at a local level in the future, rather than at a national level. "The more we can balance at real time at local level, then we will save DSOs spending a fortune on procuring flexibility services. If you have a system that is a closed loop, which is balancing itself from solar, wind and batteries it will make regional and national balancing more efficient." But speaking to Network, Matthew Williams, founder and chief technology officer of Faraday Grid, says VPPs still have the "physical limitations of the underlying system". "As the portion of renewables increases, even within a VPP, grid balancing becomes harder and more costly, for which ultimately consumers will pay. "VPPs can add some incremental value in the short-term, but will they be able to scale and be interoperable to the extent needed for system-wide transition? Without significant change in both the physics and economics of energy, VPPs by themselves will not be able to deliver the energy future we aspire for: affordable, reliable and decar - bonised energy." In April, Moixa announced plans to cre- ate a VPP, as part of a £40 million smart lo- cal energy system, which will link up solar panels, batteries and electric vehicles (EVs) around Sussex. The system is being developed by a consor- tium of firms that has secured £13 million for the scheme from the government's Industrial Strategy Challenge Fund. Moixa's chief technology officer, Chris Wright agrees that VPPs can offer enormous value in terms of balancing and flexibility services, but he also sees them as key for helping the grid evolve. "VPPs are part of a staged transition, where the electricity grid is managed more in the manner of an internet service than it is by rules of thumb that were first devel - oped in 1963," says Wright. "By taking intelligence from internet- type technologies and applying them to the energy space, we will enable the transition from highly controllable fossil fuel genera - tion to less controllable renewable genera- tion." Wright says he also believes the VPPs and micro-grid management will go main- stream in a relatively short period of time. "Having intelligent devices that shi§ energy in your home will be as normal as having a fridge," he predicts. "The cost of battery storage is coming down. Electric vehicles will go mainstream in 2021 and at that point all these transitions will come too fast for the energy infrastructure to be upgraded in order to cope with them. We will need new technologies to deal with these changes, harness them and turn them into an advantage." There can be no doubt that the energy grid is changing with internet-based tech - nology and smaller assets. VPPs might not be practical in every instance, but by being able to offer flexibility and balancing ser- vices, as well as peer-to-peer trading, they offer an exciting alternative to the concrete carbuncles or yesteryear, and play a key role in the transition to a low-carbon society. Solo Energy's Flexgrid system. DIGITALISATION FUTURE OF FLEXIBILITY