Agenda Session 3: Future Outlook for Demand Side Flexibility Cian McLeavey-Reville Andy Wainwright Sophie Hind
SO Innovation Power Responsive Flexibility Forum, October 2018
The SO Innovation process enables rapid project development 3
Our CBA for innovation ideas determines whether an idea should be developed The ‘Good’ The ‘Bad’ ▪ ▪ Technical merit: does the Costs: project and full project make technical sense? implementation / rollout costs Risks: overspend, 3 rd party, ▪ Benefits: type and quantification ▪ ▪ Strategic relevance: how well technology, resource, customer does it fit our strategy? ▪ Existing activities: what has already been done? 4
How we fund innovation projects Network Innovation Network Innovation Other sources of funding Allowance (NIA) ▪ Competition (NIC) Can offer support to third ▪ ▪ Annual pot of money Annual competition parties seeking funding ▪ Research, development between all network and demonstration operators (£70m electricity, ▪ Typically £300-400k, 6-18 £20m gas) months (no constraints) ▪ Development and ▪ 75% of NIA spend must demonstration only ▪ be external to SO Typically multi-party, ▪ Strict rules around several million pounds, 3-4 treatment of IP years 5
We published our first innovation strategy in 2018 and identified 16 innovation priorities ▪ First ever SO innovation strategy published in 2018/19 ▪ Sets out SO innovation priorities, and how we plan to work with industry partners to deliver against them ▪ Currently refreshing strategy for publication in 2019 6
Reimagining system restoration 7
How to find out more 1. Visit the website: www.nationalgrid.com/soinnovation 2. Email the team: box.SO.Innovation@nationalgrid.com 3. Reach out to me: Cian McLeavey-Reville SO Innovation Manager cian.reville@nationalgrid.com 8
nationalgridso.com National Grid SO, Faraday House, Warwick Technology Park, Gallows Hill, Warwick, CV346DA
Facilitating Whole Electricity System Outcomes Andy Wainwright Business Lead Whole Electricity System
The Energy Landscape is changing The energy landscape is changing to meet the challenges of; Decarbonisation Decentralisation Digitisation • 30 GW of distributed generation, excluding small domestic, of which almost 50 % renewables • 9GW of distributed connection applications processed in 2016 • Over 10 GW distributed solar regularly in the South for much of the summer 18 11
How we’re responding to these challenges We believe that facilitating whole electricity system outcomes will ensure that industry arrangements develop in a way that maximises consumer value Providing thought leadership • ‘Facilitating Whole Electricity System Outcomes’ Working with others • Playing an active role in the Open Networks project Developing new ways of working • Using our collaborative initiatives to learn how the ESO needs to change 12
Facilitating whole electricity system outcomes Facilitating whole electricity system outcomes will ensure that industry arrangements develop in a way that maximises consumer value. This can be achieved through a focus on six key areas. We believe in 2030; • Planning, development, investment and Markets operation of the GB networks will be optimised on a whole electricity system basis irrespective of ownership boundaries. Options Operability Development • Solutions to system operator challenges will be open to a full range of participants, Consumer facilitating both market and asset solutions. Value • Best overall value for consumers will be achieved, irrespective of the ESO or DSO performing the analysis. Governance Innovation Technology 13
14 ENA Open Networks: Future Worlds The Actors The Worlds • • Five potential future Worlds are industry structures described through in a decentralised, the eyes of a broad digitised , range of decarbonised stakeholders energy landscape referred to as actors • • Considers how Actors include system operators Suppliers, should be neutral Aggregators and facilitators of Customers flexibility markets • Provides options for who these neutral market facilitators should be The consultation has closed with around 50 responses being • Alignment with Ofgem’s work on received. These are now being reviewed and will be Forward Looking published shortly on the ENA website. Charges and Access Arrangements http://www.energynetworks.org/electricity/futures/open-networks-project/future- worlds/future-worlds-consultation.html 14
BACK COVER DESIGN Disclaimer text for back cover? Will both addresses be on the back? nationalgrideso.com Faraday House, Warwick Technology Park, Gallows Hill, Warwick, CV346DA
Project TERRE and Project MARI
What are TERRE and MARI and what are they trying to achieve? • New Cross border Balancing markets, as required by European Network Code. • Allow Transmissions System Operators (TSOs) to fulfil their balancing needs. • Providers with a minimum of 1 MW generation or demand can participate. This includes aggregated units. Project MARI: Frequency Restoration Project TERRE: Replacement Reserves with manual activation Reserves Product (RR) (mFRR) • • Marginal Pricing Marginal Pricing • Schedule Activation • Schedule Activation & Direct • 30min Full Activation Time Activation • One auction per hour • 12.5 min Full Activation Time • Go-Live: December 2019 • One auction per 15 mins • Go-Live: December 2021 17
What does this mean for demand side providers? • Ability to register as a Virtual Lead Party and register “Secondary BMUs” • New international markets for GB market participants to compete in • Introduction of new pay-as- clear pricing approach • Removal of barriers to entry for “non - BM participants” • Estimated reduction in balancing costs of €13 million per year for GB
How will the platforms work? 1. BSP provides bids to local TSO 2. TSO sends bids to central platform 3. Network constraints are provided to central platform 4. TSO sends needs to central platform 5. Algorithm computes optimal solution 6. Central platform informs TSOs of bids that are to be activated 7. Central platform informs TSOs of cross-border exchanges 8. Network constraints are updated ready for next algorithm ‘run’ 19 9. TSOs inform BSPs of their activation
Timeline Feb 2019- Pre-registration of Secondary BMUs Aug 2019- Parallel run testing of the project TERRE platform (LIBRA) Dec 2019- Project TERRE Go-Live Dec 2021- Project MARI Go-Live
Where can you find out more? • ENTSOE Project TERRE website • ENTSOE Project MARI website • Code modification P344 (Balancing Settlement Code) • Code modification GC0097 (Grid Code) • Project TERRE industry day Jan 2018 • UPCOMING EVENT: Project TERRE industry day 2. 11 th December
Thank you. Europeancodes.electricity@nationalgrid.com nationalgrideso.com National Grid ESO, Faraday House, Warwick Technology Park, Gallows Hill, Warwick, CV346DA
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