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Projects: Projects for Investigator
Reference Number	NIA2_NGESO031
Title	Service Provider Capability Mapping
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 National Grid plc
Award Type	Network Innovation Allowance
Funding Source	Ofgem
Start Date	01 October 2022
End Date	31 January 2023
Duration	ENA months
Total Grant Value	£250,000
Industrial Sectors	Power
Region	London
Programme	Network Innovation Allowance
Investigators	Principal Investigator	Project Contact , National Grid plc (100.000%)
	Industrial Collaborator	Project Contact , National Grid plc (0.000%)
Web Site	https://smarter.energynetworks.org/projects/NIA2_NGESO031
Objectives	"This project consists of 5 work packages, delivered through a combination of desk-top research, intensive external engagement, including 1-1s and workshops, as well as supply side modelling to project the capacity and volumes of supply side capacity between now and 2035, going into greater depth than Future Energy Scenarios (FES) 2022 projections.Work Package 1: Supply side modelling to project the capacity and volumes of supply side capacity between now and 2035. This will serve to provide a third-party view on the flexibility available from all relevant technologies, going to a level deeper than FES 2022 projections. It will include the capacity of technologies able to provide balancing services such as front of meter batteries, residential assets (e.g. HPs, EVs de-rated capacity), alongside transmission connected assets such as interconnectors, CCGTs etc. This will also provide estimates for technologies outside of FES that provide specialist system services (such as synchronous condensers).Work package 2: Stakeholder interviews and a meta-analysis of current innovation projects to identify the commercial factors that influence investment decisions, operational/trading decisions, locationality and environmental considerations. To be complemented by various ESO existing work programs, and internal discussions to ensure a holistic view is obtained. (The project will not collect commercially sensitive information during this phase, such as detailed trading strategies. The aim is to understand the generic business models of these different providers and their market preferences to allow the ESO to take these into account and design markets in a way that is suitable to them.)Work package 3: Stakeholder interviews and desk-based research to identify features along the provider journey to understand specific pain points from both an ESO and non-ESO market perspective.Work package 4: Applying the lessons learnt from the previous phases and providing and analysis of ESO markets to identify the pain points for our markets. Validation via stakeholder engagement in the form of a mini consultation. A workshop with the ESO Subject Matter Experts (SMEs) to be held to identify the potential reforms based on these findings.Work package 5: Generation of a summary report providing the conflicts and opportunities for market reforms. This information will be disseminated internally, followed by dissemination to the public.In line with the ENAs ENIP document, the risk rating is scored Low. TRL Steps = 1Cost = 1(£250k)Suppliers = 1 (1 Supplier)Data Assumptions = 1Total = 4 (Low)" "The scope consists of 5-phases.Work package 1: Generate a comprehensive list of current, emerging and future service providers across voltages and fuel types and detail their technical service provisions. Such provisions would include reactive/active power, stability services (such as inertia), speed of response and the duration of output that can be sustained, reliability, limitations etc.Develop our understanding of the hardware required for these assets to flex: metering, smart control, grid forming capability etc. What is the cost of such equipment, and who provides the capability (the unit themselves, an aggregator, third party, part of asset investment, etc)?Benefits: a comprehensive list of providers will ensure all technologies are considered when designing markets, thereby improving liquidity and reducing costs.Work Package 2: Understand how these providers make theircommercial decisions. This will include factors that influence investment and operational / market entry decisions, as well as locationality and environmental considerations. Carry out comprehensive segmentation of providers/investors based on their risk appetite and routes to market, e.g., via an aggregator, a supplier etc.This work package will also include a deep dive into the role of aggregators and the broader stakeholder landscape including the role of policymakers and local authorities to understand their respective roles in the flexibility value chain.Benefits: support decision-making for the commercial terms of products, to ensure they maximise participation and reduce system costs.Work Package 3: Building on the mapping of the overall stakeholder landscape to translate these into the practical and commercial issues experienced along the provider journey. These will be the key steps within the value chain, from asset development through to the provision of services and settlement. This will include registration, auctions/trades, scheduling, dispatch, performance monitoring, settlement etc, to identify any key pain points.Building upon this, another output from this task will be to compare and contrast this service provider journey across different markets (CM, WM, DSO etc) in order to provide a holistic understanding of the issues that service providers incur.Benefits: an understanding of the customer journey will help identify barriers and inefficiencies within ESO markets which, by removing, could improve market efficiency and lower consumer bills.Work Package 4: Overlay the findings from work packages 1-3 onto the suite of ESO balancing service markets to access their efficacy against providers capabilities and business models. This is to identify the preferred market design parameters of each service provider. In doing so, understand how the ESO can become an enabler by asking what customers need from the ESO, and by when, to allow them to provide the services that they want to.Benefits: concrete recommendations for reforms to improve competition and lower consumer bills.Work Package 5: Pulling together all the work of phases 1-4 to create a summary report.Benefits: all the analysis in a report format will enable ESO, DSOs and policymakers to enhance their understandings of emerging technologies and improve the ESO, DSO products and wider market design, thereby reducing consumer cost." "The key objectives for this project are to:Gain understandings of all service providers, both existing and emerging, their technical capabilities and their commercial models.Identify the pain points for ESO customers, both existing and emerging, across markets to provide a holistic view on the barriers to entry and how these may be avoided through future reforms.Create high-level guidance for the ESO on reforming markets to reduce barriers to entry, increasing competition and liquidity."
Abstract	National Grid ESOs knowledge of the technical and commercial preferences of existing and emerging service providers is limited. We need to develop effective markets in a rapidly changing electricity system. This project aims to address this knowledge gap and generate guidance on how to design future markets to better account for changing asset types. This is especially pertinent given Government targets to deploy and scale up new technologies that dont participate in existing markets. The outcomes of this project will be used to improve our markets to increase liquidity and facilitate a better customer experience, ultimately reducing costs to consumers.
Publications	(none)
Final Report	(none)
Added to Database	01/11/23