Ensuring security of supply through flexibility
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Ensuring security of supply through flexibility 16 th November 2016 1
Transcript of Ensuring security of supply through flexibility
Ensuring security of supply through flexibility
16th November 2016
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Agenda:
The role of flexibility in the future energy system
Understanding the value of flexibility
Opportunities for consumers with dynamic energy consumption
Integrating flexibility with procurement to ensure the best returns
Why act now?
Ensuring security of supply through
flexibility
Robert Owens
Vice President, Demand Side Management
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Flexibility is crucial to our future energy
system
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Tight power supply margins Sustainability targets
Security of supply Rising delivery costs
The value of flexibility is set to increase
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Source: Future Energy Scenarios, July 2016
Business opportunities in Demand Side
Response (DSR)
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Reduce costs by avoiding costly peak charges such as triad and red-band DUoS
Monetise the flexibility of your assets and take advantage of revenues that are available now
Strengthen your CSR credentials by becoming a more responsible energy user
Ensure security of supply for your business by becoming a smarter consumer
Prepare your business to take advantage of future opportunities for demand flexibility
Turning flexibility into a revenue creating
asset with the capacity market
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Live scheme to ensure security of
supply over the winter peak
Rewards customers able to offer
up commercial-size flexibility
For the auctions coming up this winter the Government have set out
to buy:
53.8GW in the early Capacity Market auction (January 2017),
for delivery in 2017/18.
52GW in the T-4 auction (December 2016), for delivery 2020/21
300MW of turn-down DSR capacity for 2017/18 in the
Transitional Arrangements auction in March 2017
Multiply capacity payments to see returns
of £70-£80 per kW
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£-
£10
£20
£30
£40
£50
£60
£70
£80
£90
£/k
W
Illustrative Savings for DSR Curtailment
(at Peak time) per kW
Non-Commodity
Saving
Energy Saving
Capacity
Market (TA)
£-
£10
£20
£30
£40
£50
£60
£70
£80
£/k
W
Illustrative Savings for DSR Shift
(Peak to Off Peak) per kW
Non-Commodity
Saving
Energy Saving
Capacity Market
(TA)
Note: Revenue and costs provided for illustration only
Customer case study
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Generator
running costs,
£1,091.50
Customer: Large consumer
goods manufacturer
No. of factories across the UK: 2
No. of sites providing DSR: 1
Total flexible capacity: 1,850kW
Back-up generation: 1000kW
Turn down DSR: 850kW
Capacity
market, £19.25
Energy saving,
£7.15
Non-
commodity
cost saving,
£61.45
0
10
20
30
40
50
60
70
80
90
100
£ p
/kW
Generator running cost,
-£16.20
£71.65 per kW per year
1,850kW = £124,885 per year
Note: Revenue and costs provided for illustration only
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Use your assets as ‘energy stores’ to
package flexibility
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Food storage
Sustain fridge/freezer
temperature
parameters
Data centres
Switch to back-up
generator
Manufacturing
Increase no. of
production lines
outside of peak
Retail
Adjust Heating,
ventilation and Air
Conditioning set points
Future proof your business against rising
peak costs
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0
100
200
300
400
500
2014 2015 2016 2017 2018
£/M
Wh
TNUoS
0
20
40
60
80
100
120
140
2014 2015 2016 2017 2018
£/M
Wh
DUoS
0
50
100
150
200
2014 2015 2016 2017 2018
£/M
Wh
Capacity Market
0.0
1.0
2.0
3.0
4.0
5.0
2014 2015 2016 2017 2018
£/M
Wh
CfD
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Integrating flexibility with procurement to
ensure the best possible returns
Regulated supply contract
Flexibility contract
Benefits of one company managing both:
Having visibility over both can help consumers make optimal decision and ensure compatibility
Use the flexibility in the supply market to extract
additional value
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Act now…
Start the conversation…
Visit our stand (B45) to discuss the DSR opportunities for winter 2017/18
It’s easier than it looks The commercials
get stronger
Start now to realise
your flexible capacity
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Thank you
Disclaimer: Unless stated otherwise all data in this presentation has been sourced by SmartestEnergy who reserve all rights to the images and content displayed which should not be reproduced for commercial use. Unless SmartestEnergy provide express prior written consent, no part of this presentation should be reproduced, distributed or communicated to any third
party. SmartestEnergy do not accept any liability for actions taken in relation to the guidance provided in this presentation, if this presentation is used for an alternative purpose from which it is intended, nor to any third party.
