Project Summary
To maximise flexibility on electricity networks we need to know about two key facilitators:
•Firstly, the potential for flexibility from properties
•Secondly, the potential for connection to electricity networks
Without these, operators will struggle with network planning and flexibility procurement. This could increase costs and lead to expensive demand balancing solutions; especially where local authority, industrial and commercial buildings are concerned.
MaxFlex proposes to complement existing work assessing domestic flexibility by creating Energy Flexibility Certificates; for industrial, commercial, and local authority buildings. Adding electricity network capabilities, connection arrangements, and market opportunities should reduce bills and create more efficient electricity networks.
Innovation Justification
Why Innovative
This project takes inspiration from the concept of Energy Performance Certificate and its innovation is to introduce a similar concept focused on provision of Energy Flexibility Certificates (EFC) to I&C properties. The concept introduces metrics and indicators and enables the visualization of flexibility at customer site level to energy networks.
Like the EPC, the EFC provides an intuitive format for I&C customers to understand the value of available and potential flexibility, allowing them to make informed investment decisions, better access revenue from flexibility services and minimise carbon emissions. Similarly, this will enable DSOs to target the most relevant business for additional support on entering flexibility markets.
Building on previous research
The concept leverages research from CREDS at the University of Reading. The research specifies a set of relevant flexibility metrics that associate with certificates. These metrics when collated, will provide visualised data and information that can be used to assess the potential flexibility available to networks.
The Centre for Net Zero (CNZ) have also published a press release outlining the concept of Smart Building Ratings (SBR) for domestic properties. There is no duplication with the SBR being for residential properties; however, we will be liaising closely with the CNZ to maximise outcomes from both projects.
Fitting the SIF Challenge
The concept enables I&C/Local Authorities to understand their potential as flexibility market participants. Digital tools will be used for engagement and data collection. The EFC certifies the flexibility potential and the capability of the premises network connection. .
Once collated, and visualised, this allows building owners and network operators to engage more effectively. Building owners can be better informed and confident in their decision making and electricity networks can use feedback in digital platforms providing more accurate flexibility forecasting. The concept will also fit into other digital initiatives within the energy industry, such as the ENA Direct Connect.
Why not BaU
The processes and tools to enable this capability do not exist and are thus not appropriate for BaU funding. Building owners do not have visibility of their flexibility potential, nor how to maximise this flexibility.
The EFC will introduce processes, tools, and commercial models that allows I&Cs to maximise their flexibility potential and provide better visibility of their connection capability. This project aims to test the feasibility of the concept and introduction of the processes, tools, and models above.
Impacts and Benefits
Financial
Network operators do not have clear visibility of the flexible technologies used by the I&C estates within their network. Visibility of these, together with a certification of how much demand and generation flexibility they can provide becomes valuable data, enabling the cost savings in the following areas:
More accurate modelling, leading to better informed forecasting
Ability to produce frequent and more complex models, leading to better planned outcomes
Speeding the dispatch of flexibility services, leading to more effective network operation
Ability to provide more options for non-network solutions, reducing the cost of network development through wider participation in flexibility markets
Increased market liquidity in flexibility markets through a diversification of service providers and sources of flexibility
Increased ability to make better informed and efficient network investment decisions. These reduce the costs to operate, develop the network and positively impact consumer bills.
During Discovery it would be possible to carry out studies into possible operational efficiencies gained in modelling, planning, speed of service dispatch and measure the benefits that can be achieved.
New to market | products, processes | services
Through this initiative, a collection of products, services and processes will be introduced. The EFC itself is a product which will help I&Cs participate in flexibility services. This introduces processes to engage with that entity, and offers them services they can take part in. EFC at the same time, incentives commercial properties to take part in Demand Response, thus reducing their consumption and bills. Furthermore, EFC is a compliment to other industry initiatives, especially the ENA's Connect Direct, and can provide seamless processes for LCT installers and their customers.
Revenues - improved access to revenues for users of network services
Because the EFC defines a commercialisation model for the I&Cs, there is opportunity for participation in flexibility markets, which brings revenue for the I&Cs, leading to further market maturity, potential evolution of other innovative products and services, and cross industry collaboration for the participants. Throughout the study, it would be possible to understand baseline consumption and generation for certain commercial archetypes and thus derive the benefits they might receive in terms of revenue or cost savings. Furthermore, by clearly identifying areas for improvement to increase flexibility, cost benefit analysis can be done by individual I&C to determine the best strategy to maximise their overall return on investment and minimise their carbon footprint.
Impacts and benefits
As GB decarbonises, power is shifting to Renewable Energy Sources (RES), often distant from demand centres and connected at distribution level and will make our energy supply more intermittent. Decarbonisation of demand – particularly transport and heat – will increase overall demand and introduce sharper peaks in demand.
Flexibility in the energy system will be needed to more effectively match the supply and demand of the electricity system through storage, interconnection and demand-side response.
National Grid ESO is projecting for up to 12GW of flexibility to come from domestic and commercial customers in 2040 (ESO FES 2024).
The benefits of flexibility could amount to £10bn per year by 2050 (or £14.1bn per year by 2040)* through avoided network reinforcement, unnecessary generation infrastructure and wasted power.
The aim of MaxFlex is to maximise flexibility and with it maximise the benefits of energy flexibility.
MaxFlex Energy Flexibility Certificates (EFCs) can provide greater insight into the energy performance and flexibility potential of the built environment to support customers and industry in delivering the energy transition
With 70.8% of UK energy demand in 2023 was by Industrial, Commercial and Energy customers*, it is critical that we reduce the barriers to participation for sectors if we are going to maximise flexibility effectively.
Energy Flexibility Certificates (EFCs) will be a key driver allowing maximum flexibility by improving visability, information and confidence in the market.
EFCs can also inform Industrial and Commercial (I&C) customers, Local Authorities and the energy industry on the value and potential for flexibility and enable a lower cost journey to Net Zero.
The interplay between the lack of information available on the existing and potential flexibility of properties (residential and I&C) and the utilisation of flexibility as a service to plan and operate the energy system poses a fundamental challenge in decarbonising the energy system. Therefore, there is a need for a systematic approach to estimate and share the potential for flexibility at the property level (residential and I&C) with the relevant parties, to fully unlock the benefit of flexibility to the energy system.
When developing the Cost Benefit Analysis (CBA) for MaxFlex we classified benefits as Direct and Indirect. Within these we identified eight specific benefits from B1 to B8.
Direct benefits reflect the immediate benefits of EFCs, whereas Indirect benefits reflect the consequential benefits, assuming that access to EFC data encourages increased consumers flexibility participation.
Direct benefits were categorised into two sections with their own specific benefits, B1, B2, and B3 as below:
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- Improved network investment planning better modelling of current/future flex supply and peak load, allowing more effective use of load-related expenditure and targeted expansion of network capacity. These both benefit DNOs primarily
- B1. Reduce instances of ‘early’ reinforcement, enable more confidence in network needs, and enable more strategic and coordinated network intervention
- B2. Reduce instance of ‘late’ reinforcement and delays in connections
- Reduce costs in flexibility procurement due to increased flexibility supply and reliable forecasts of flexibility available for procurement
- B3. Reduce costs in flexibility procurement
Indirect benefits are centred around reducing peak network load, due to increased uptake of LCTs / microgeneration and increased participation in demand-side response. They are listed below as B4 to B8:
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- B4. Delay or avoid reinforcement, due to flattened load on network
- B5. Reduced need for capital investment in C-intensive large-scale generation
- B6. Reduced carbon emissions from reduced C-intensive generation
- B7. Reduced network losses with higher uptake of renewable microgeneration and more consumption near production
- B8. Reduced carbon emissions from reduced network losses
*https://assets.publishing.service.gov.uk/media/66a7da1bce1fd0da7b592f0a/DUKES_2024_Chapter_5.pdf
