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Projects: Projects for Investigator
Reference Number	NIA_UKPN0018
Title	Efficient network constraint management through the use of market signals
Status	Completed
Energy Categories	Other Power and Storage Technologies(Electricity transmission and distribution) 100%;
Research Types	Applied Research and Development 100%
Science and Technology Fields	ENGINEERING AND TECHNOLOGY (Electrical and Electronic Engineering) 100%
UKERC Cross Cutting Characterisation	Not Cross-cutting 100%
Principal Investigator	Project Contact No email address given Eastern Power Networks plc
Award Type	Network Innovation Allowance
Funding Source	Ofgem
Start Date	01 June 2016
End Date	01 February 2017
Duration	14 months
Total Grant Value	£250,000
Industrial Sectors	Power
Region	London
Programme	Network Innovation Allowance
Investigators	Principal Investigator	Project Contact , Eastern Power Networks plc (99.999%)
	Other Investigator	Project Contact , South Eastern Power Networks plc (0.001%)
Web Site	http://www.smarternetworks.org/project/NIA_UKPN0018
Objectives	The aim of this project is to develop an improved approach to managing distribution network constraints, focusing on three key objectives: Develop market-based mechanisms (i.e. price signalling) to enable more efficient curtailment actions. Being compatible with multiple technology and commercial solutions (wind, solar, batteries, DSR). Providing appropriate signals to the DNO to reinforce when economically sound to do so. It is also anticipated that this work will provide insights into the future workings of a DSO model. As such, an objective of this work is that the market models investigated address some of the questions that will be important for the DSO model, including: The commercial and technical interaction between DNO actions and the requirements of the System Operator (SO)The role of third party aggregators, and in particular their interaction with the DNO How the DNOs role changes as it moves towards a DSO function, including real-time constraint management, contracting for commercial services, and potentially providing (or facilitating the provision of) services to the SO. The project is deemed successful if: The proposed solution meets the objectives and industry has been consulted in its development; and The proposed solution is worth progressing to formal trials with market participants.
Abstract	The increasing prevalence of distributed generation (DG) creates additional challenges for balancing the system. There is also an increase in the range and number of flexibility providers on the distribution network that could be utilised to provide system services. DG, storage and flexible demand, therefore, create both a need for, and enable, more active system management at the distribution level. Whilst a consensus is emerging that some form of Distribution System Operator (DSO) role needs to be taken on to make efficient use of distributed flexibility options, it is not clear at this stage what form the DSO model should take. There is a requirement, therefore, to explore and trial some of the possible approaches in order to develop understanding of how best to proceed. UK Power Networks (UKPN) Flexible Plug and Play (FPP) project ran between 2012 and 2014 under the Low Carbon Networks Fund. FPP was an innovation project trialling new technologies and commercial arrangements in order to connect DG, such as wind or solar power, to constrained areas of the electricity distribution network. It was intended to deliver greater flexibility in accommodating cheaper and faster DG connections, as well as enabling previously unviable DG schemes to become feasible. Under the scheme, in addition to receiving the conventional connection offer, customers in an FPP area were offered an interruptible connection. This connection offer would typically come at a lower cost to the connecting customer, but would allow UKPN to curtail the customers generation output in times of network constraints. The network monitoring, data analysis and asset control was carried out by an Active Network Management (ANM) system, which managed predefined and pre-agreed principles of access. The principles of access trialled under FPP were a combination of "pro rata" and "Last In First Off" ("LIFO"). FPP successfully demonstrated that lower-cost connections could be offered, that were commercially viable for DG customers; however further opportunities to improve the service offered to customers have been identified: Whether LIFO of pro-rata approaches are used, the curtailment applied is not always economically optimal for two reasons. First, LIFO and pro-rata approaches do not have a mechanism for considering which generators have higher or lower opportunity costs and which may be curtailed before others to minimise impacts. Second, there is no recognition of the proximity of a generator to a particular constraint, meaning that a generator with little ability to alleviate the constraint may be curtailed fully whereas an alternative generator could only be partially curtailed to achieve the same effect. Mechanisms for generators to signal their willingness to reduce or increase their curtailment risk by trading with other scheme participants could better facilitate optimum curtailment decisions. There is no mechanism for introducing multiple technologies, which isrequired in order to incorporate the storage assets that have come to the fore since the inception of FPP. Properly integrating such technologies could provide the required constraint management at a lower cost. There is no signal provided to the DNO to reinforce the network, even if the overall cost of curtailment exceeds the reinforcement cost. It is a strictly DNO solution, creating known conflicts in parts of the network where there are distribution-connected Balancing Mechanism Units (BMUs) or where there are transmission constraints. New commercial and technical interfaces between industry parties will become increasingly important. Correspondingly, it is not well suited to managing multiple interacting constraints, resulting in multiple stacks depending on the location and nature of the constraint. Finally, curtailment is only based on real power output, whereas alternative approaches can be taken to alleviate the constraints including adjusting generator power factor. Building on the findings of the original FPP project, the project will review the approach taken previously and propose new commercial strategies in order to address the aforementioned limitations. Alternative approaches to managing flexible connections will be explored, including how demand side response (DSR) and storage can be better accommodated. This work will be integral to informing future DSO operation. The project would comprise the following steps: Defining a set of criteria against which schemes should be assessed, reviewing the existing FPP scheme against those criteria and take into consideration future generation customers, to note areas of good practice and identifying areas where modifications may be required. Developing, at a high level, a number of alternative schemes for managing interruptible contracts. Assessing each of these schemes against the criteria, and prioritising them with a view to generating a shortlist (or potentially a single approach) that can be trialled. Engaging with existing and potential customers to inform the criteria setting and assessment. Carrying out a more detailed desktop analysis on the selected shortlist of designs in order to explore these in more detail, including, for example, an analysis of how different stakeholders would be affected. This will be completed to quantify the relative merits of the market design options and how the preferred market design could be taken forward to trial. Developing draft Commercial Heads of Terms between the DNO and network customers that could be used as the basis for any subsequent trials. Carry out a more detailed Impact Assessment of shortlisted designs on internal control systems and organisational processes. The assessment criteria would be developed on the basis of one or more workshops. It may be appropriate that the following themes may be covered in this work: What is the cost associated with curtailment by existing and potential generation customers, and hence what would be the relative position of their bids ? How does this compare to the expected bidding behaviour of alternative flexible approaches such as electricity storage and DSR aggregators ? Does the approach provide the appropriate signals not only to ensure efficient curtailment, but also to encourage flexible providers to connect at optimal locations on the network ? How would the bids be made, assessed and processed, and by whom ? How and when does money change hands ? Are there any risks of non-competitive bidding behaviour (e. g. small numbers of participating customers) and what mitigating options exist ? How does the approach interact with other actions being taken on the electricity system (e. g. effect on transmission-level constraints, or conflicts with TSO actions taken on embedded BMUs) ? How well does the scheme work across multiple technologies?How is the reinforcement trigger signaled ? Note : Project Documents may be available via the ENA Smarter Networks Portal using the Website link above
Publications	(none)
Final Report	(none)
Added to Database	14/08/18