Utility Week

UTILITY WEEK | MARCH 2023 | 31 Electricity A new model The UK's ongoing energy crisis has exposed the fragility of the grid and underlined the importance of energy exibility to help build resilience through a fundamental transfor- mation of the system. The ability to modify generation by call- ing on low-carbon technologies, and to change domestic and business consump- tion patterns to either release power back to the grid or store it during times of lower demand, helps support national balancing and local congestion relief. It can also help lower bills, unlock • nancial bene• ts for dis- tributed energy resource (DER) providers and underpin the national transition to net zero. Flexibility services are playing an increas- ingly important role in the UK. Figures published by Energy Networks Association (ENA) show that in 2022 distribution net- works tendered almost 4GW of exibility in 12 months, a record for the fourth year run- ning and equivalent to providing electricity to over four million homes. DNOs are at various stages of implement- ing new processes and functions under a DSO model, which will allow them to actively manage systems in real time using a combination of exible local alternatives to network reinforcement. Ofgem has de• ned it as encompassing network planning and development, network operation, and mar- ket development. Details of how DSOs will be regulated, including on performance, and reporting requirements will be determined based on responses to last year's consultation and implemented under RIIO-ED2. Northern Powergrid's DSO business unit went live last autumn and, according to Paul Glendinning, policy and markets manager, it is now actively recruiting, setting up ex- ibility systems and forecasting units, and has rolled out new exibility contracts. A key obstacle to making exibility work at scale, he says, is public understanding of the bene• ts of changing their consump- tion habits: "When the energy crisis is over, suppliers are likely to start introducing more exible tari" s with more time slots, which will change demand on the network. We will need to monitor that to look for any constraints." The arrival of market-wide half-hourly settlement in October 2025 will be a game- changer, he adds, giving more people the opportunity to gain extra payments and reduce their bills. Recent media coverage of exibility tri- als, such as ESO's Demand Flexibility Ser- vice, have stimulated consumer interest. Ovo Energy is running two trials, Shi— & Save and Power Move, the latter rewarding customers by up to £20 a month. The supplier is testing di" erent times and durations to build an understanding of what works well for customers. Amanda MacDon- ald, head of energy range at Ovo, comments: "With Shi— & Save, we are varying the times and days of the week for each alert and the reward per kilowatt-hour, to gain valuable insight into what is a more achievable shi— for our customers." So far, midweek alerts from 4-6pm have seen the highest opt-in and success rates. More widespread use of smart meters and half-hourly reads that give customers detailed energy-tracking data and advice will be key to simplifying customer engagement in exibility, she adds. "Greater uptake of smart home appli- ances, such as dishwashers or washing machines, can also help, by allowing them to set programmes to coincide with greener periods or outside of alert times, making demand shi— ing more convenient," says MacDonald. Market moves Encouraging more low-carbon technolo- gies on to the network and paying homes and businesses for their electricity demands transparent and user-friendly market mecha- nisms and procurement platforms. As distributed generation ramps up, a parallel increase in the number and types of commercial transactions and network access will require the modi• cation and extension of systems contracting exibility and ena- bling new access rights. Contracts and pay- ments are currently managed manually, but automation is considered necessary in RIIO- ED2 to keep pace with the market. Under its remit to facilitate the develop- ment of local exibility markets, the Open Networks programme, run by the Energy Networks Association, is revising the exist- ing standard agreement for procuring ex- ibility services and working to better align exibility procurement processes across DNOs and ESO. Flexibility market platforms like Piclo, Nodes, and Electron are already popular, but none yet meet all the requirements of di" erent stakeholders in the sector. SSEN is currently working with platforms to under- stand how they can be used for complet- ing procurement all the way through to settlement. More "joint thinking" by industry is required, says Doshi, to ensure platforms meet the needs of DSOs and exibility pro- viders, use standard protocols (including for security) and ensure the market remains competitive and fosters innovation. "Platforms need to clearly de• ne rules on which markets providers can sell energy into and how," explains Doshi. Some exibility services still require exclusivity, preventing providers from selling to both a DSO and the ESO, which limits value. She adds: "It's understanding how we can facilitate stack- ing, not just within DSOs, but between the ESO and DSO, we need clear rules on that." 1617 MAY, NEC, BIRMINGHAM See this content brought to life at Utility Week Live. Register free at: utilityweeklive.co.uk continued overleaf Ovo Energy's Amanda MacDonald will speak about making fl exibility easy for customers on the Customer stage at Utility Week Live on 16 May. Northern Powergrid's Paul Glendinning will speak about establishing the DSO function and defi ning business as usual operations on the Smart stage at Utility Week Live on 16 May.

• Cover