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Balancing Mechanism Wider Access webinar - key takeaways
Published by Andrew Langlands 23 / 01 / 20
In another industry first, Flexitricity has aggregated two batteries owned by Philip Dennis Foodservice and dispatched them in response to a call for energy received from National Grid ESO using the newly-launched Balancing Mechanism Wider Access arrangements.
Philip Dennis Foodservice is a family-owned regional catering wholesaler based in Devon supplying customers with a range of frozen, ambient and chilled foods.
The company has a Tesla energy storage system at their site in Mullacott, and a BYD battery adjacent to another of their sites at Roundswell. Both batteries are connected to Flexitricity’s virtual power plant and are managed round the clock by Flexitricity’s 24/7 control room in Edinburgh.
Today Philip Dennis Foodservice became the first of a new wave of participants which will trade in the Balancing Mechanism after National Grid ESO removed barriers to entry to this market at the tail end of 2019.
The transaction marks an important milestone for the GB energy market and highlights National Grid ESO’s focus on boosting real-time flexibility in the system and improving equality of access. Balancing Mechanism Wider Access presents a huge opportunity for a range of flexible energy users, including EV users, domestic heating and energy storage, district heating, renewables and community energy projects, and industrial and commercial flexibility such as refrigeration, HVAC and lighting.
Historically the Balancing Mechanism has been dominated by large energy suppliers, formerly known as the ‘Big Six’. Now, as the country moves towards its 2050 net zero carbon targets, National Grid ESO and ELEXON have made changes to encourage smaller, more agile energy assets to contribute.
This change will improve system flexibility, which will facilitate renewable energy deployment and bring better value to consumers. New entrants to the market – like Philip Dennis Foodservice – will be able to reduce their environmental impact whilst creating additional revenue streams without disrupting day-to-day operations.
Flexitricity monitors the Balancing Mechanism and remotely alters the charge and discharge profile of Philip Dennis Foodservice’s batteries on site, in response to National Grid ESO’s requirements to balance supply and demand in real time.
The Balancing Mechanism is one of the main tools National Grid ESO uses to balance supply and demand on the electricity system in real-time. Through the BM, providers can offer to increase or decrease their generation or demand to help balance the system.
Roisin Quinn, Head of National Control at National Grid ESO, said:
“We’re excited to see the first example of wider access to our Balancing Mechanism as a Virtual Lead Party in action with Philip Dennis Foodservice and Flexitricity. Wider access opens up opportunities for new providers and technologies to become part of the electricity market, making it smarter and more flexible as we shift away from traditional large thermal power generation to cleaner, decentralised power.
“This transformation is central to the way we balance the system today – particularly as we work to meet some of the challenges associated with balancing the system in lockdown conditions – and forms an important part of being able to operate carbon free by 2025.”
Andy Lowe, Director at Flexitricity, said:
“We are delighted to be the first to complete a trade in the Balancing Mechanism utilising this new route to market and are fully committed to helping more businesses like Philip Dennis Foodservice to access this revenue source.
“We have been working with businesses for over 11 years to maximise the value of their energy assets and now we can provide this service to thousands more businesses.
“Our focus has always been to build a decentralised, greener and fairer energy system where all energy users benefit – not just the big suppliers. It’s hugely rewarding to see that that’s now becoming a reality. Philip Dennis Foodservice – a small, family-owned business – is traded as part of our virtual power plant in the same, lucrative market the ‘Big Six’ are trading in. It’s a perfect example of the progress we’ve made as an industry over the last few years.
“Now as at any other time, our energy system needs customer-side flexibility to be both secure and green which is why it was important to us to be able to reach this milestone despite the situation with Covid-19. We were delighted to have successfully onboarded the Philip Dennis Foodservices sites remotely during the lockdown period.”
Peter Dennis, Director at Philip Dennis Foodservice, said:
“Sustainability is at the heart of everything we do, and we’re delighted that working with Flexitricity is enabling us to ‘green up the grid’. We’re extremely proud that our batteries were the first ever assets traded in the Balancing Mechanism through this new route to market.
“Energy used to be purely a cost for us and something that we didn’t have much control over. Now, by slightly altering our generation and consumption profile, in response to National Grid ESO’s requirement, we’re able to earn additional revenue that can be invested back into the business and gives us a competitive advantage.”
NOTES TO EDITORS:
Additional information on the Balancing Mechanism process can be found here: https://www.nationalgrideso.com/balancing-services
The first trade utilising the Virtual Lead Party (VLP) route was completed on 23rd April 2020.
National Grid ESO opened up the Balancing Mechanism to VLPs with Balancing Mechanism Wider Access in December 2019. VLPs are a new type of market participant which can provide balancing services without needing a supply licence or to pay ‘use of system’ costs (BSUoS and TNUoS). Flexitricity are the first established aggregator to qualify as a VLP.
Flexitricity – Ross Henderson / email@example.com / 0141 471 8399
National Grid ESO – Alex Roache / firstname.lastname@example.org / 07790603991
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