In our recent webinar, Nick Huntbatch, Head of Product, shared some UK flexibility developments from across the past 12 months. From the launch of the Open Balancing Platform to the delayed Market-wide Half Hourly Settlement (MHHS), here’s an overview – or you can watch the full webinar now, on demand.
1. Flex is becoming mainstream
Flexibility is now becoming part of mainstream conversations in the UK. The Demand Flexibility Service is just one concrete example. Last winter, the service successfully saved over 3,300MWh of electricity – and has been approved again this winter.
This service rewards people to change their behaviour. For example, it encourages consumers to be flexible, to benefit from the energy transition as more low carbon technologies come into play. It’s therefore changing the way that consumers engages with the energy system, as they start to recognise what flexibility is.
The conversation around flex is becoming more prominent for DSOs in the UK as well. More flexibility is being tendered across the system.
However, the data shows that contractor capacity hasn’t quite kept up with system needs. There was 4.6GW of capacity tendered in 2022 by electricity network companies on Great Britain’s local flexibility markets – yet only 2GW contracted.
There’s therefore more to be done to ensure that more flexibility can be contracted. That’s one area where flex markets can help. They can make it easier for providers to access those markets to offer up their flex services to system operators.
2. The Open Balancing Platform is now live
Our second UK flex update is that the National Grid ESO’s Open Balancing Platform (OBP) has now officially launched. The OBP represents a new suite of tools and processes. These will help evolve and update ESO’s options for balancing and alleviating system constraints.
As part of this new toolset, the ESO can issue many more small instructions as part of its “Bulk Dispatch” capability. Those instructions will engage and dispatch smaller Balancing Mechanism Units (BMUs) and battery energy storage. This is a more effective use of Distributed Energy Resources in the Balancing Mechanism.
Flexitricity has already seen an increase of 164% in the number of Bid/Offer Acceptances versus its rolling 2-month average since the OBP launched – although they stress that it’s still early days to fully assess its impact.
3. The ENA has updated its DSO flexibility products
In 2018, the Energy Networks Association’s (ENA’s) Open Networks programme outlined four “standardised” DSO flexibility services: Secure, Sustain, Dynamic, and Restore.
The way these products have been deployed across DSOs has varied. This is fundamentally because each part of the distribution network has its own system needs, such as:
- The type of people connecting
- The type of technologies connecting
- The stage they’re at in their flexibility life cycle
This year, Open Networks released an update to the definition of DSO flexibility products, moving to five options based on payment and timing.
Beyond the naming and number of products, the update also reflects a change in thinking. Instead of a one size fits all approach, the products offer a “menu of options”, tailored to suit the needs of each DSO’s system.
4. Market-wide Half Hourly Settlement (MHHS) has been delayed
The Market-wide Half Hourly Settlement (MHHS) has been pushed back again until 2026. When it’s implemented, electricity suppliers will get regular and accurate signals about their customers, throughout the day.
When deployed, MHHS will provide the basis for a shift in the way we use energy. This includes rewarding consumers for changes in behaviour. This will incentivise consumers to take control of their energy usage and allow the rollout of more innovative products from suppliers.
Consumers will therefore see more value from flexibility. Plus, more data will be available on usage at the low voltage level, to help system operators with forecasting.
5. BSC code modification P415 provides a route to the wholesale market for flexible demand
In October, Ofgem announced the BSC code modification P415, which will allow demand turn down into the wholesale market. This creates a new route to market and a new revenue stream for flexibility providers. It will also help further incentivise being flexible, increasing the levels of flexibility available in the system.
Providers want more choice of price signals to respond to. For DSOs, this is simply a new opportunity to invest in making products and services attractive to different cohorts of provider – whether its long-term stable price signals, to support different business models, or engaging variable loads such as EV chargers.
For more European, US, and UK flexibility developments, watch the full webinar:
