|Network Innovation Allowance (NIA)
|Nov 2019 - Dec 2021
|New Technologies and Commercial Evolution
The objective of the project is to understand current process limitations with regards to domestic flexibility providers with the aim to demonstrate and test solutions to those limitations.
First generation DSO services are already being provided by large distribution-connected assets – as evidenced by Flexible Power, Piclo, Power Potential, and more. Western Power Distribution (WPD) alone procured 28 MW of flexibility in 2018 with volumes expected to increase as the service develops. Distribution System Operator (DSO) services are being standardised across DSOs under the Open Networks project, initially focused on constraint management, and are becoming Business as Usual (BaU) across GB.
Whilst there are some smaller providers emerging, these services tend to be provided by relatively large (>200kW) assets, for instance batteries and generators. Flexibility providers to date have tended to be commercial actors for whom energy is core business (or a fundamental cost component of business), rather than individual householders.
But second generation DSO services will need to facilitate widespread participation from homes too. The market is fast developing new domestic flexibility solutions – spanning vehicle-to-grid (V2G), smart and hybrid heating, stationary batteries and more. The units of flexibility offered at domestic scale are individually small, often at the level of single kilowatts. This drives different requirements when participating in local flexibility markets. If DSOs are to be a neutral market facilitator, they must ensure a level playing field for these new domestic solutions.
Facilitating domestic participation means identifying – and addressing – unconscious biases in DSO service design. Example issues have been raised in National Grid Electricity System Operator’s (ESO) live Residential Response project, which seeks to address some specific barriers to domestic flexibility providing Firm Frequency Response (FFR); this is not yet public domain but early findings have been shared with WPD. Barriers are also outlined in Everoze’s Swarm Governance report under the Core4Grid project. In addition, Everoze’s experience of acting as Independent Technical Expert (ITE) for frequency response testing is uncovering practical empirical lessons. Issues include:
- Dynamic allocation of Demand Side Response (DSR) assets within domestic portfolios
- Bid windows to accommodate rapidly changing asset availability
- Automation in testing and delivery to accommodate very large numbers of assets
- Metering and baselining
- Commercial incentive design and risk allocation.
- Possible standardisation of requirements between DSO and other services.
Future Flex is a participant-led trial of second generation DSO services, deploying step-change innovations for procurement, testing and delivery suitable for domestic scale assets. The project will focus on active power demand reduction services. The benefits will be increased market liquidity and competition – and resulting lower costs of flex service provision.