Northern Powergrid urges businesses to sell flexibility services
District Network Operator (DNO) Northern Powergrid has opened an online auction aimed at procuring 100MW of flexible energy capacity across, largely from businesses.
Under the e-auction scheme, called ‘Restore Flexibility’, businesses which consume large amounts of energy, generate their own power or operate energy storage arrays will be encouraged to sell their flexibility services for a set price per MWh.
This price will be set using a “reverse Dutch” format, whereby the auctioneer incrementally raises the price from a low starting point until a bidder agrees to sell.
When a final contract is awarded, successful businesses will enter a pool of assets across Yorkshire, northern Lincolnshire and the North East, which will be instructed to collectively turn up or down to support a stable power supply in the region.
Northern Powergrid believes that by procuring 100MW of flex in this way, it can better prepare its regions for more renewable generation to be added to the grid, while helping local businesses reduce their energy consumption and bills.
In addition to businesses, organisations such as local authorities are also being encouraged to approach Northern Powergrid.
“With increasing numbers of councils across our patch declaring a climate emergency, we are eager to build a system that can support a fully decarbonised power sector while ensuring we provide the best possible service at the best possible price for every single member of our community,” Northern Powergrid’s head of policy development Jim Cardwell said, referencing its eight million domestic and business customers.
“Actions like flexibility procurement for network resilience are crucial to this and empower our customers to play a more active role in network management.”
Late last year, Northern Powergrid became one of six utility firms to commit to set new requirements for all new network infrastructure to include "smart" flexibility services, as more renewable arrays come online nationwide.
Along with Electricity North West, Scottish and Southern Electricity Networks, SP Energy Networks, UK Power Networks and Western Power Distribution, Northern Powergrid vowed to ensure that the installation of services such as on-site generation, demand-side response and energy efficiency measures will become a pre-requisite for project investment by 2020.
Similarly, UK Power Networks (UKPN) has adopted a “flexibility first” approach to the delivery of extra grid capacity. It has additionally released details on how it will roll out 25 "flexibility first" zones across its distribution networks in London, the South East and the East of England – areas where demand for flexibility could collectively exceed 200MW by 2023.
Despite this progress from businesses, the Renewable Energy Association (REA) has repeatedly warned that the UK Government and regulator Ofgem are not doing enough to facilitate the transition to a flexible energy system, at the speed required to reach net-zero by 2050.