Centrica has completed a £16.7 million three-year energy market trial in Cornwall that saw local and national network operators simultaneously buy flexibility for the first time.
Smart batteries and monitoring equipment were installed in 100 homes in the county as well as solar panels in the 54 properties where they were not already fitted. Around 5MW of smart, low-carbon technologies also installed at 100 businesses.
Working in partnership with Western Power Distribution, National Grid Electricity System Operator (ESO) and the energy consultancy N-Side, Centrica developed an auction-based online marketplace that facilitated the trade of 310MWh of flexibility over the course of the trial.
The company estimated that in order to accommodate the government’s plans to power every home with offshore wind as much as 25TWh of flexibility will need to be bought and sold in the UK every year – almost double the annual demand of Wales.
“Because solar and wind are dependent on the weather, sometimes they produce too much power for the grid to accommodate, and sometimes too little to meet demand,” said Jorge Pikunic, Managing Director of Centrica Business Solutions. “This could lead to assets being switched off, which is expensive and inefficient, and in extreme cases power cuts.
“Flexibility offers an alternative, more cost-effective way of tackling these constraints and gives consumers a real stake in managing the energy system. At a national level, the system is managed using flexible demand, battery storage and flexible generation, however, it is becoming increasingly important to manage network constraints at a local level too.
“The trial in Cornwall has proved that homes and small businesses can play a role, alongside larger industry, in market-based procurement of flexibility – a genuinely new tool in our low-carbon energy system toolbox.”
The domestic batteries were aggregated together to form a “virtual power plant”, with 75 of them being used to offer frequency response services to the ESO. Centrica said the platform “manages the process for both sides from contract creation all the way to baselining and settlement, making it easy to trade flexibility.”
Colm Murphy, electricity market change development manager at the ESO, said: “This pioneering local energy market (LEM) trial showcases a smart, flexible and decentralised electricity system in action. Exploring innovative ways to access flexibility through new markets is key to us unlocking the potential of distributed and community-based renewable energy resources and will bring significant cost benefits to consumers.
“While current levels of residential flexibility are low, as local market initiatives like the Cornwall LEM are introduced and consumers are increasingly incentivised to be flexible, we anticipate seeing a transformation in the way our nation consumes power.
“This will help us deliver clean, secure and affordable electricity – softening peaks in demand and filling in the troughs – and will take us another step closer to our 2025 ambition to operate a zero carbon grid.”
Jennifer Woodruff, innovation and low carbon networks engineer at Western Power Distribution, added: “This project has provided useful learning about different options for how we could purchase flexibility services, especially how we could build in processes to manage conflicts and avoid breaching network limits.”
Energy minister Kwasi Kwarteng commented: “Smarter energy means greener energy and cheaper bills, which is why this successful trial in Cornwall is such good news.
“With even more renewable electricity on the way, projects like this will be crucial as we work towards net zero emissions by 2050.”
Centrica also worked with Exeter University and Imperial College London to analyse the findings. The trial was funded by the company with the help of an £11.6 million grant from the European Regional Development Fund.