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Projects: Projects for Investigator
Reference Number NIA_NGSO0027
Title Testing Coordinated DSO-ESO Procurement and Dispatch
Status Completed
Energy Categories Other Cross-Cutting Technologies or Research(Energy Economics) 100%;
Research Types Applied Research and Development 100%
Science and Technology Fields SOCIAL SCIENCES (Economics and Econometrics) 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 September 2019
End Date 01 July 2020
Duration ENA months
Total Grant Value £45,000
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/NIA_NGSO0027
Objectives The project will trial the procurement of flexibility by two market actors via a pay-as-clear auction that will provide uniform pricing per auction, no matter who the purchaser is. These auctions will comprise longer term reserve auctions and day-ahead and intraday utilisation auctions, in light of EBGL changes that will require split reserve and utilisation procurement. The platform will provide visibility of reserved (contracted) and utilized (instructed) volumes across flexibility buyers. In future phases of work, we will assess the benefit of this visibility to system operators in their control room decision making.The flexibility sellers will consist of aggregators or larger demand-side customers. The procurers will be National Grid ESO and Western Power Distribution (WPD).Procurement of flexibility will be around one GSP (Indian Queens) situated on WPDs network. Due to the locational nature to the trial, National Grid ESO will operate a shadow market approach to avoid any unfair/uncompetitive procurement approaches. By shadow market approach, we mean, all activities included in the trial will operate outside existing BAU Balancing Services, including tender, assessment, instruction, settlements, and spend. Project funding will allow NG ESO to pay for contracted reserve and utilisation through the platform. However, NG ESO will not be utilising/instructing any volume to resolve live system issues. Any volume instructed will be done solely for the purpose of achieving project learnings. Flexibility procurement will take place via 3 month ahead, 1 month ahead, 1 week ahead, day ahead, and intraday pay-as-clear auctions, with flexibility allocated between procurers. Auction rules will take into account buyer requirements and ensure flexibility is allocated in an efficient manner. Over 6 months, ESO and WPD will test various scenarios on the platform (procurement in isolation, procurement in parallel, utilisation). In each case, we will be procuring 500kW blocks of energy. Renewable generation and demand side provider participation in markets has been growing rapidly in number, and becoming more diverse by technology. Whilst this trend is projected to continue, there is the potential for the size (MW volume per asset) of demand side provider to decrease with the emergence of residential flexibility assets and electric vehicles all connecting on local distribution networks.Existing flexibility markets are evolving and new markets are being developed, in particular by Distribution Network Operators, that may create a disparate world of uncoordinated, competing flexibility markets, confusing and overcomplicated for flexibility providers to understand and participate in. It may also lead to fractured market liquidity, and lead to conflicts in service delivery, particularly between DNOs and ESO.There has also been significant work by the Energy Networks Association to develop future world scenarios for operating a whole system approach. The Cornwall LEM trial closely aligns with Future World B, and will provide significant real life learnings. The platform has been developed in collaboration with WPD, who have been participating through their Visibility Plugs and Sockets NIA project. The trial is seeking to prove (or provide learning) on several fronts: The PlatformDoes a single platform for multiple markets work in practice, does the end to end process hold up, can multiple buyers and multiple sellers trade effectively?Does the clearing algorithm work – does the auction clear and provide a single price across markets?Open Networks Future Worlds BHow the end-to-end process of World B works in practice? What might need to change in:Contract termsProcurementUtilizationSettlementHow might a platform deal with service conflict?Does this simplify the procurement process (qualitative feedback from providers)?We aim to support the realization of benefits set out in WPDs Visibility Plugs and Sockets projectBalancing Services: Reform of ReserveWhat is the impact of different timescales of procurement of a reserve-type product on:Types and number of providersVolume tenderedVolume acceptedPrice
Abstract The project will trial one simple route to multiple flexibility markets via one platform. This approach of coordinated procurement and dispatch of flexibility between ESO and DNOs is one of the Future Worlds outlined by the Open Networks project. This approach has not been trialed before, and there are many uncertainties and unknowns about how it would work in practice. This project will start to unpick those uncertainties by trialling the end-to-end process, from procurement, to utilization and settlement. This project supports and builds upon WPDs Visibility Plugs and Sockets project.
Publications (none)
Final Report (none)
Added to Database 09/11/22