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UK Power Networks announces results of UK’s biggest ever competitive Flexibility tender

UK Power Networks has announced the results of the UK’s biggest competitive tender to procure flexible energy services.

From Press releases - 15 May 2019 12:00 AM

Flexibility is a rapidly emerging new market for generators, including renewables, to sell services to electricity networks. It saves customers money by using distributed energy resources to offer additional capacity on the network at peak times instead of the traditional method of building new infrastructure.

UK Power Networks’ second Flexibility tender has successfully offered contracts for a total of 18.2MW of power from six companies across eight different locations to install or recruit new flexible capacity with a total value of more than £450,000. The technologies involved are a mix of energy storage, demand side response, renewable energy and other generators.
Barry Hatton, director of asset management at UK Power Networks said: “Flexibility offers a wealth of opportunities for the energy resources connected to our network like wind and solar plants, but also demand side response to help us create an open, transparent and accountable new market for their services.
“All of the bids we accepted in this tender round met our robust economic criteria to ensure they will benefit our customers by offering lower costs in comparison to the traditional approach of building new assets. The UK is a world-leader in Smart Grid technology and Flexibility has a key role to play as we move towards a decarbonised, decentralised and digitised network that will offer significant benefits to our customers.”

UK Power Networks is the first network operator to use the ground-breaking online platform Piclo (formerly known as Open Utility) to host and manage the bidding process. Piclo is an online platform developed with UK Power Networks which matches energy providers’ resources with the network operator’s local need for flexible energy resources.

Piclo enables flexible energy resources to explore an interactive map that matches providers with pinch-points on the network, places where UK Power Networks is seeking flexibility to add capacity. The zones were advertised here: https://picloflex.com/dashboard

The shift to local renewable generation has transformed the UK’s energy system, and a number of innovation projects and business as usual in this tender give customers greater control over their energy use. When UK Power Networks launched its vision for the future, ‘A Smart Grid for All’, in 2017, it described the transformation in energy as being similar to the impact the advent of broadband had on telecommunications in the early 2000s. 

In 2018 UK Power Networks became the first network operator in the country to commit to a radical ‘Flexibility First’ approach, offering its requirements for new capacity to the distributed energy market ahead of the traditional approach of building network reinforcement. 
Flexibility contracts have been offered in the following locations:
• Brandon
• Leighton Buzzard
• Lewes Newhaven
• Lithos
• Merton
• Mill Hill
• Romney Warren
• St Helier

Further details about the successful contracts will be announced in due course.

To view the UK Power Networks Flexibility Roadmap visit here http://futuresmart.ukpowernetworks.co.uk/.
To register your interest in Flexibility email: flexibility@ukpowernetworks.co.uk

Background notes on Flexibility
Flexibility has three key benefits to customers:

Lower electricity distribution costs: flexibility will allow UK Power Networks to defer capital expenditure to upgrade cabling and substations to help lower costs for consumers. A study by Imperial College London showed that deploying flexibility could save customers nationwide £17bn - £40bn by 2050.
New revenue opportunities for distributed energy resources: flexibility tenders will provide electricity generators, renewable energy, storage, major consumption users and aggregators a new way to offer their energy resource and create new income.
A stronger network: flexibility will contribute to an even more resilient electricity supply by helping to reduce electricity demand during peak times on our network.

In summer 2018 UK Power Networks launched its Flexibility Roadmap, a step-change in the way the UK’s regional electricity networks operate. The proposals will make UK Power Networks the first UK distribution network to adopt a ‘flexibility first’ approach to delivering additional network capacity to the 8.2m homes, businesses, schools and hospitals it serves.

Until now providing additional capacity has required new cables and substations, but flexibility services will give UK Power Networks - already the UK’s lowest cost distribution network operator - the opportunity to take a more cost effective approach.

By 2023, UK Power Networks estimates its market for flexibility could be over 200 MW, which could reduce peak demand for electricity on the distribution network by the equivalent of approximately 130,000 homes.

The move could also create new markets for distributed generation, such as wind and solar farms and electricity storage across London, the South East and East of England, to offer their resources to network operators. The company believes that the increased competition will get more renewable energy onto the network at lower cost.