Dynamic Pricing

Completed

Other Power and Storage Technologies(Electricity transmission and distribution)
Other Cross-Cutting Technologies or Research(Energy Economics)

Applied Research and Development

SOCIAL SCIENCES (Economics and Econometrics)
ENGINEERING AND TECHNOLOGY (Electrical and Electronic Engineering)

Not Cross-cutting

Project Contact
Northern Powergrid

Network Innovation Allowance

Ofgem

01 February 2025

31 March 2026

ENA months

£268,000

Power

Yorkshire & Humberside

Project Contact, Northern Powergrid

Project Contact, Northern Powergrid (Yorkshire) plc

Building on the work in Shift 2.0, we will develop a dynamic pricing signal that takes account of both LV and HV network conditions on a day ahead basis. The price signal will be delivered to Octopus, who will use their EV connected customers to test the effect of using the signal to run the network in an effective and efficient manner as possible. The project will investigate two separate price signal models to compare and contrast the methodologies. The initial overview of the project has identified the five key work packages listed below.Work Package 1, Project technical design and set-upWork Package 2, Trial DeliveryWork Package 3, AnalysisWork Package 4, Dissemination and legacyWork Package 5, Project management and quality assurance.After work package 1, the project plan will be reviewed. Confirmation of the key design decisions are made in this phase. This includes identification of network characteristics of interest, the identification and assessment of suitable network locations, the assessment of the availability of Octopus controlled assets, the identification of both control and response variables of interest, ensuring the required data flows are available etc.Depending on the outcomes we will look at potential extension of the project. A fully successful project would deliver the following outcomes:Development of full project design, delivery of and acceptance of that design.Development and testing of an appropriate dynamic DUoS signalDevelopment and testing of Operational design for Dynamic PricingDevelopment and testing of a commercial design for Dynamic pricing from the individual perspectives of NPg, Octopus and retail customers. Assessment of the trade-offs between these actors. This includes identification of issues for particular groups, such as vulnerable customers.Development of commercial arrangements and a contractual exemplar for the provision of dynamic pricing based flexibility services.Assessment of the usefulness and impact of dynamic pricing flexibility approaches in network design and longer-term development.Assessment of interactions across the both the NPg network and with the broader electricity system and the identification of possible conflicts current and future.

The current, static nature of DUoS charges fails to address the increasing variability of when periods of peak demand occur e.g. instances ofprice herding around periods of negative wholesale prices that can fall outside of thetraditional peak demand periods. While explicitly contracted flexibility services can seek to address this through demand turn down/generation turn up services, procuring such services adds cost &complexity to mitigating network constraints. Additionally the totality of the network is not usually considered, with a focus often on either an HV or LV solution. Dynamic network pricing will take the form of a multi-voltage level network price as well as differentiation within the same voltage level, enabling specific assets, such as individual low voltage feeder cables to be priced uniquely based on prevailing conditions. This network level approach will co-ordinate price signals to efficiently mitigate system wide constraints&avoid possible conflicting actions

09/04/25