NGESO is continuing to review the efficacy of the balancing services currently procured to meet system demand and maintain security of supply. As such, a number of services have recently been trialled and rolled out to the Request For Information (RFI) stage or Expression Of Interest (EOI) stage.
NGESO want to widen market access for balancing services providers and ensure all eligible technologies are competing on a level playing field. This is especially pertinent for renewable generators such as wind farms, for example, that have historically been unable to tender for services such as frequency response due to the production forecast limitations and commercial disincentives.
Bringing service provision closer to real-time enables more precise procurement and delivery as the system need becomes more exact and apparent, as well as allowing more generators to compete in the auctions, thereby hopefully decreasing the cost.
Fewer services may be required to meet the same objectives, as some legacy balancing services are clearly not fit for purpose as can be seen by the enhanced reactive power service (ERPS) which hasn’t had any bids for 7 and a half years and no new contracts for 9 years. This reduction in the number of services streamlines the balancing services and gives greater clarity to market participants as well as ensuring the service provision is efficient and cost-effective. Product roadmaps have been released by NGESO to highlight how they envision future services to develop and be provided.
Wider BM Access
Increasing participation in the BM should lead to more cost-effective balancing actions through more competitive auctions. In the recently published roadmap, NGESO look to remove barriers to BM entry for small and aggregated units by ensuring suitability for the participation of supplier aggregators in the BM and creating a new way of entering the BM for parties wishing to provide near real-time flexibility (see figure 1).
Figure 1: The aggregator route to market flowchart
These may be from non-traditional providers or aggregators who are not currently licenced suppliers. Additionally, some providers may also provide frequency response services. When units are providing frequency response, they cannot be counted on as spare capacity to match any changes in demand.
This is leading to a decrease in the number of providers in the BM able to provide the much-needed flexibility to balance generation with demand. “‘Reserve’ is a service that ensures there is sufficient spare capacity to call on in the event of a system imbalance, but the decreasing proportion of accessible flexibility alongside increasing variable reserve requirements means that the current arrangements may not be sustainable.
The implementation ofProject TERREgives an opportunity to create new and better routes to the Balancing Mechanism for some providers. The European Electricity Balancing Guideline (EBGL) means the ESO will be developing a European Balancing auction platform alongside the other European Transmission System Operators. This platform will create a way for standardised balancing products to be exchanged across borders, and it needs to be open to all types of balancing service providers. This includes embedded generation, aggregators and Demand Side Response.
Reactive Power
Since reactive power services are driven by local need, there are obligatory requirements for larger generators which can be seen in the generator’s connection conditions but also tender opportunities in certain areas of need. One such opportunity has recently been released for the Mersey region, to solve high-voltages on the Transmission network. It is anticipated there will be a shortfall in reactive capacity in the region from April 2020 so there is a need to make up the shortfall. This tender may also inform NGESO on how future reactive power capacity may be met.
For the Mersey region, providers must be connected within the red boundary in figure 2:
Figure 2: The boundary which Mersey region providers must be connected within.
Tee most effective sites are close to Frodsham GSP and Rocksavage GSP and connected to higher voltages.
The minimum technical criteria is specified below:
Minimum reactive power absorption is 5 MVAr (for embedded providers this must be between 0.5 and 0.95 power factor leading) and connected at 33kV or above. This can be from a single unit or aggregated from several smaller units at a single connection site.
Synchronous transmission connected providers must be in voltage control mode, whereas distribution connected and non-synchronous providers must be in power factor control mode. All technologies should be in the correct control mode for the duration of instruction, and if operating in a different mode, move to the correct mode without instruction.
Tenders must be submitted by17:00 on Friday 29th November 2019.
Fast Frequency Response
The phase 1 frequency response auction trial has been ongoing since 13thJune 2019, procuring the low frequency static service weekly. NGESO standardised within-day windows for FFR and now procure the product in 4-hourly Electricity Forward Agreement (EFA) blocks. This has improved transparency of the decision-making for providers and made the tender assessment process more efficient.
NGESO are moving forward with Phase 2 which will procure dynamic frequency response bundles (equal amounts of primary, secondary and high frequency response), where the first Commercial Phase 2 Auction will take place onFriday 29th November, with delivery commencing at23:00 GMTthat same evening. This will facilitate access to the market by technology types such as wind and DSR which are less forecastable.
Phase 2 of the auction will procure four products: faster low frequency static response and high frequency static response, high frequency dynamic response, and low frequency dynamic response. The auction will be held every Friday morning with results being published by early afternoon.
Providers are to bid a single MW value, no higher than the lowest pre-qualified values for primary, secondary or high response. The product can be provided from an aggregated portfolio and the provider will be paid for availability for the MW value cleared at the auction’s clearing price, with no compensation for over delivery. Service stacking will not be possible; providers must choose whether to enter this market or the ongoing traditional monthly FFR tender.
NGESO plan to procure 100 MW of each product (static, dynamic) on an ongoing basis with offers capped at 20 MW per unit for each product provision. The trial will last for 24 months from the end of the development phase to ensure that NGESO can test different parameters and approaches prior to full implementation.
The auction algorithm will seek to minimise the cleared price so therefore bids will be accepted in price order without regard to their size.
Stability Pathfinder Phase One
Stability pathfinder phase one is designed to support the National Electricity Transmission System (NETS) stability, an accelerated tender process and timeline for Phase one was decided after receiving feedback via the RFI. This was designed to give maximum opportunity for providers to develop solutions ready for service from no later than April 2021 and beginning as early as 1stApril 2020.
The tender recently released will seek stability providers across GB at either 132kV, 275kV or 400kV voltage levels. It looks to procure a zero MW firm availability stability service for contracts ending 31stMarch 2023 or 2026- a three-year and/or six-year delivery window. These tenders will be assessed separately and a decision will be made on the best overall value delivered to proceed with a set of three-year or a set of six-year options, with no mixed options.
Since NGESO require high confidence in service delivery due to system requirements and the timeline for performance, the technologies available to enter this tender will be limited to synchronous compensators and synchronous generators running in synchronous compensator mode.
The three elements assessed will be:
- inertia;
- short circuit level; and
- fast acting dynamic voltage capability.
NGESO will look to procure 25 GVA seconds, with a maximum provision of 8 GVA seconds from each individual company. However, the tender will require permanent availability throughout the year (with 5 days planned outages per annum).
The forecast cost is made up of the: availability payment = £/year tendered cost; and active energy payment = £/MWh.
The availability payment will only be made when the plant is available to provide the service or during agreed planned outages. Payment will not be made during any period a plant is generating active power. Reactive power will be paid at the default reactive payment rate (£/MVArh). Active power consumption requirements will be reimbursed at imbalance price (£/MWh).
Providers can offer other balancing services in conjunction with this stability service, as long as this does not impact the tendered stability service. The benefits of the additional services provided however will not be considered as part of this tender.
The service is open to generators who wish to forgo winter availability payments for generation revenue streams, but who will provide firm (24 / 7) availability for this service over the summer.
