The move to develop more efficient methods of generation, battery storage and demand/ supply balancing is leading energy companies to find new ways of placing control over power in the hands of big users like manufacturers.
The government is expected shortly to announce which technology it is backing for the development of localised nuclear power generation, perhaps the ultimate in the decentralisation of electricity production.
A consortium led by Rolls-Royce is understood to be in detailed discussions with the Department for Business, Energy and Industrial Strategy, with its Small Modular Reactor (SMR) technology seen as a strong favourite. Ecotricity’s Mark Meyrick reports.
Readers of The Manufacturer will have read about the challenge of renewable energy generation being ‘intermittency’, shorthand for the profound changes happening in the electricity system.
These changes, as well as the move to ‘smart grids’ present great opportunities for large users of power, particularly those with the ability to turn down – or up – their facility’s demand, or add power from on-site generators.
The key is flexibility, and the reason this is important is that the national grid is prepared to pay users to consume flexibly.
These days, the grid needs this flexibility in increasingly short time frames to help manage the fluctuating levels of power coming from the growing capacity of renewables on the system, as well as the effects of the diminished amount of reactive power that help stabilise voltage levels.
Consumers or providers?
In the new energy world, consumers are also providers, as the UK moves away from a demand-led system to a generation-led system, with the possibility of demand flexing to meet generation.
As a result, the grid is busy enabling as much flexibility onto the system as it can, which will also help the local grid network operators.
Energy provider Ecotricity is expanding its business supply offering to include a flexibility element for suitable customers – we will pay a flexibility revenue on a shared basis through the actions of our ‘virtual power plant’ (VPP).
The VPP enables a set of assets, including demand-side response (DSR) sites such as a manufacturing facility, to work together as a single controllable whole.
In such a system, combined assets can create capabilities (and income) greater than the sum of its parts – for example, in providing a service to the National Grid, a system can use batteries for the first few seconds, and then utilise other assets for the duration of whichever event is being responded to.
The combination of assets that offset each other’s limitations can create a portfolio with very versatile capabilities (see the graphic).
Each asset is connected to our control room through a virtual private network, with a communication box sitting on every asset. Signals sent to, and by, the asset enable instant response, as well as allowing the control room to see exactly what each asset is doing every second.
Bespoke running regime
What is crucial for our clients is that the first priority of the manufacturing facility’s day-to-day operations should not be impacted.
We engage in detailed conversation with site engineers to understand the required running regime of a facility, and then programme that running regime into the VPP as one of the constraining parameters.
And it should be remembered that we are talking about relatively minimal load shifts over small amounts of time – anything from a few seconds to 30 minutes and, of course, if running regimes need to change, we will adapt the VPP accordingly, so good communication with clients is paramount.
The VPP earns money from flexibility, its short-term operating reserve and the capacity, balancing and trading markets, maximising income from whichever income area is ‘hot’.
For example, in the last week of February when we had the extreme wintry conditions, the VPP would have been far better using its flexibility in the trading and balancing markets than, say, the frequency response service.
Also, at times we see negative system prices, when the grid has too much power. On these occasions the VPP can earn revenue by switching generation off, or turning up (charging a battery).
Working with a proven player with good forecasting is essential so as to be able to identify these possibilities ahead of time.
Current regulation also creates some incentives for behind-the-meter installations of photovoltaic panels and/or storage for suitable customers, and these can fit very well into a VPP set-up.
Not only are there self-consumption benefits, but some Climate Change Levy charges can be avoided now that storage has been identified as a subset of generation, as can several types of grid charges which business pay for power imported off the grid.
Battery storage is becoming increasingly viable as prices drop, although whether this trend continues with the heavy demand for lithium and cobalt from the electric vehicle sector remains to be seen.
For the immediate future, as the National Grid and distributed network operators search for increasing amounts of flexibility in response to grid volatility and the need to avoid network reinforcement costs, balancing needs will increase.
This will provide a good opportunity for businesses to have a hard look at making the best use of any inherent flexibility in their load management, as well as the benefits of onsite generation and storage possibilities
Mark Meyrick, head of Smart Grids, Ecotricity