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Agenda Session 2: Current Landscape: Changes affecting Demand Side Flexibility John Adelle Jon Bryant Wainwright Parker Wider BM Access Adelle Wainwright Senior Commercial Lead Roadmap published August 2018 Three main drivers for


  1. Agenda Session 2: Current Landscape: Changes affecting Demand Side Flexibility John Adelle Jon Bryant Wainwright Parker

  2. Wider BM Access Adelle Wainwright Senior Commercial Lead

  3. Roadmap published August 2018 Three main drivers for change Maintaining operability • Third party studies report benefits of wider participation in BM of £110-500m pa Consumer benefits • Distributed gen capacity could reach 67GW by 2050 • Upwards & downwards variable reserve requirements may double by 2022 Removing barriers to entry • Addressing the link between equal treatment and equal access 3

  4. How are we going to get there? 1. Increasing participation routes Wider BM Access Improving existing routes to 2. Clearer accession requirements market (Aggregation via supplier) 3. Aggregated BMU participation in balancing services Our commitments 4. Improved & clearer comms systems requirements Creating new routes to 5. Simpler data submission process market (Independent aggregation) 6. Improved ESO ability to optimise & dispatch aggregated BMUs 7. Clearer & simpler metering requirements 8. Support industry work on alternative PN Improving systems and provision processes 9. Support industry work on behind the meter settlement 4

  5. Roadmap of BM access milestones – progress update ✓ ✓ ✓ ✓ ✓ ✓ 5

  6. Key next steps – systems and processes The system change landscape is complex We know that stakeholders are impacted by the changes we make, and are currently working to develop improvements in line with the roadmap. We plan to share our thinking and develop solutions in an agile way and over the coming months will engage & update stakeholders via • IS change forum • Dedicated webinars 6

  7. Next steps – contracts and markets Code changes – new Balancing services Now P344 & GC0097 contracts route to market have been approved we are currently • Further communication • CUSC modification proposals working on ensuring due shortly CMP 296 & 297 (facilitating modifications relating to • Proposals will be consequential establishment of Virtual Lead outlined in relevant changes are made to Parties) currently with Authority Outline Change Proposal for decision CUSC and balancing processes for each • CUSC proposal setting out service services contracts Virtual Lead Party contractual arrangements CMP 295 on track • Follow up session on TERRE & wider access joint with Elexon 11 th December • Potential further BSC modifications following Issue 70 & 71 7

  8. Where can I find out more & get involved? BSC P344 Grid Code GC0097 • www.elexon.co.uk/mod-proposal/p344/ • www.nationalgrid.com/uk/electricity/codes/grid- • For more info contact: code/modifications/gc0097-grid-code-processes- bsc.change@elexon.co.uk supporting-terre • For more info contact: Grid.Code@nationalgrid.com BSC Baselining & Behind the Meter Issue Groups BSC P354 • https://www.elexon.co.uk/smg-issue/issue-70/ • https://www.elexon.co.uk/smg-issue/issue-71/ • https://www.elexon.co.uk/mod-proposal/p354/ • For more information contact: • For more info contact: bsc.change@elexon.co.uk bsc.change@elexon.co.uk ENC Fact Sheets Joint European Stakeholder Group • A monthly meeting covering all European legislation • Fact sheets providing an overview on each EU code issues (supported by BEIS, Ofgem, National Grid are available on our website: amongst others) • www.nationalgrid.com/uk/electricity/codes/european- • Weekly Email Newsletter Update network-codes?code-documents • For more info contact: europeancodes.electricity@nationalgrid.com IS questions: box.is.changeforum@nationalgrid.com BM access Qs: 8 Box.balancingprogramme@nationalgrid.com commercial.operation@nationalgrid.com

  9. nationalgrideso.com National Grid ESO, Faraday House, Warwick Technology Park, Gallows Hill, Warwick, CV346DA

  10. Power Responsive Flexibility Forum Update on developments in network access and charging October 2018

  11. Reforming our electricity network access and charging arrangements We are currently undertaking a holistic review of network access and charging arrangements, through two linked projects: Targeted Charging ➢ The Network access project aims to ensure our networks are used efficiently and flexibly, so consumers Review (TCR ) can benefits from new technologies and services while avoiding unnecessary costs on bills in general. ➢ The Targeted Charging Review aims to ensure that residual network costs are recovered in a fair way and do not unduly distort behaviour. Access Rights & Forward Looking • By this we mean users’ network access rights and how these rights Network access Charges review are allocated. rights Our “network access” project • The elements of network charges that signal to users how their Forward-looking actions can either increase or decrease future network costs in charges different locations. •Residual charges are ‘top up’ charges set to ensure that the network Our Targeted Residual charges companies’ efficient costs can be covered, after other charges have (“scaling”) Charging Review been levied. 11

  12. Areas we are proposing to review under the Network Access project Network access arrangements Improving the Clarify access rights allocation of access Improving access and choices for small rights, including choice and definition users, including enhancing the scope for larger users households for markets Forward-looking charging arrangements Focused Comprehensive Review of improvements to the review of distribution distribution transmission use of use of system connection charging system charges charges (DUoS) boundary (TNUoS) 12

  13. Options we are considering in the Targeted Charging Review We set out in a working paper last November four bases for charging residual charges: Gross consumption Ex ante Ex post charges capacity capacity Fixed charges (based on all (charges (based on (per user user’s related to measure of fixed charges) consumption user’s agreed individual incl. from or connected peak system onsite capacity) usage) generation) We will consult on refined versions of these options later in the year. This will include thinking on any transitional arrangements. 13

  14. Balancing Services Use of System (BSUoS) charges • Our Targeted Charging Review is reviewing Embedded whether changes are needed to remaining “embedded benefits” for distributed benefits generation • We think there could be value in further work to help determine the long-term Future direction of BSUoS as a whole, potentially direction through an ESO-led taskforce in the first instance on BSUoS • Interaction with our decision on CMP250, which we will publish shortly 14

  15. Key timings and how to engage 2019 2020 2021 2022 Q3 2018 Q4 2018 Consultation TCR SCR decision and Implementation Ongoing policy on “minded - to” from 2020/21 outputs raised as development SCR decision onwards code modifications (late 2018) Target first Consultatio Access/ SCR Proposed set of Forward- n on scope Options development, conclusions review changes to looking and form of assessment and consultation decision take effect launch (2 nd half 2020) charges review (April 2022) You can engage through: ➢ Responding to our written consultations ➢ Attending the Charging Futures Forum or other specific workshops we may hold ➢ Accessing materials such as summary notes, podcasts and webinars at www.chargingfutures.com 15

  16. DSR Code of Conduct A what?? John Bryant Director of Business Development 23 October 2018

  17. Why the ADE? We represent the majority of DSR aggregators in UK Recent experience of establishing a similar scheme for heat customers Alignment with the ADE vision; for A local, efficient, low carbon energy system which enables energy users to make the choices which work for them

  18. Why do we need a Code? In 2016 an ofgem report estimated that by 2020 DSR may provide up to 30-50% of Balancing Services Concern that aggregators are not licensed or regulated In 2016 Ofgem had no evidence of significant inappropriate behaviour Aggregators want to ensure a high level of customer trust in the market

  19. What problems are we solving? • Assurance that ethical business standards are being adhered to by Who can I members trust? • Requires bids & proposals include common elements so different suppliers can be compared on a ENERGY like for like basis USER • Ensures transparency about what What members will provide and any How do I should I compare? expect? obligations Customers may be taking on

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