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10 | NOVEMBER 2021 | UTILITY WEEK Special report Analysis Flexible energy system needed in climate fight A major new report from Utility Week and Capgemini identifies the key issues for UK utilities in the net-zero journey, and one of them is system flexibility. Denise Chevin reports. R ecent events have shown just how dif- ficult balancing the energy system can be. Most consumers take for granted that electricity and heating is only the flick of a switch away. Yet soaring wholesale gas prices, plus a lack of wind, damaged inter- connectors and ageing nuclear power sta- tions out of service for maintenance, have combined to create a crisis. For all the UK's undoubted successes on the transitioning path to zero-carbon genera- tion, the turmoil seen across September and October has highlighted just how far there is to go in ensuring a resilient and workable energy system as we move towards 2050. A recent report from Imperial College London forecast that by 2050 the UK could be generating 150GW of offshore wind. But as Dr Jeff Hardy, senior research fellow at the Grantham Institute, Imperial College Lon- don, observes: "If the wind isn't blowing that leaves a big hole in electricity – and demon- strates just how important having flexibility to call on will be." As demand for power increases and more distributed generation assets like electric vehicles (EVs) are connected to the system there is also another dimension to flexibility to think about. That is ensuring that the capacity of the network to deliver greater demands for power will also be met affordably. In the past as demand grew, it would be fed by installing more cables; but now, to make it economi- cal, networks are being asked to manage extra demand in a smart way, levelling peak demand through local flexibility. That will mean networks won't need to invest to the same degree in upgrading infrastructure. This "flexibility first" approach will be a key plank of the network's forthcoming ED2 business plans. Andy Huthwaite, director of ED2 pro- gramme at Scottish and Southern Electric- ity Networks (SSEN) Distribution, explains how the network has been responding to the changing landscape: "For quite a number of years now we've been taking a flexibility first approach. So if someone wants a new con- nection which could trigger the need for rein- forcement, irrespective of whether that was demand or generation, we've put a range of things in our system that allows us to pre- sent flexible options to them. "In our Scottish Highlands distribution network, for example, we've introduced active network management. That has allowed people to participate and connect to the network without us having to do five years of reinforcement at x million pounds." However, moving to a more flexible sys- tem will still require networks to invest in technology to monitor the network, analyse data and improve communications, says Huthwaite. The levels of local flexibility contracted by network operators in 2021 are already 38% higher than the total for the whole of the last year, says Randolph Brazier, director of inno- vation and electricity systems at the Energy Networks Association. At the moment, flex- ibility is contracted typically through an aggregator or directly with industrial and commercial customers, says Brazier, but it could develop more widely. He says: "The local flexibility markets only started in the back half of 2018 from scratch and don't exist anywhere else in the world. The reason why we are ahead of the pack is that policies and regulation are in place to drive adoption." He cites the ban on sales of combustion engine vehicles, the RIIO model which incentivises networks to be innovative, and the research and develop- ment allowance, which allows innovations to be trialled and tested. Huthwaite points to SSEN Distribution's ambitious plans for flexibility in ED2, the next price control, and is looking to increase its flexible connections up to about 3.75GW and within that is hoping to procure around 5GW of flexible services from 600MW cur- rently. "That's a step change for us, but as a country if we're going to hit our net zero ambitions then the deployment of flexibility is going to be absolutely critical," he says. In terms of balancing supply there are broadly four types of flexibility the electricity system operator (ESO) can consider: • Flexible generation – like biomass; • Electricity storage – like batteries, hydro power, compressed air; • Demand-side response – turning demand for energy up or down, on or off, such as industrial processes; • Interconnectors – importing electricity from the continent. Hardy says this adds up to a diversity of options. "Although demand-side response from the domestic side is currently negligible, you shouldn't under-egg that – we could be looking at 35 million EVs and 20 million heat pumps, that's a vast array of things that can be turned on or off," he says. Government is aware of the need to use EVs to boost flexibility. It is proposing phased legislation to ensure that all charge points are smart and in time wants to give powers to network operators to be able to delay battery charging for the benefit of the grid. Hardy acknowledges that the use of EVs and heat pumps doesn't provide the answer to the huge variation in demand between summer and winter, but says it does provide a solution to those variations during the day. "However, there is no evidence yet to support what we can deliver this way because the sys- tem is not up and running yet," he says. Right now, flexibility supplied from EVs and heating is negligible and it is acknowl- edged that scaling this up will require signifi-

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