Learnings
Outcomes
The value and role of flexibility in the 2050 energy system
Harnessing flexibility from distributed resources saves the cost of future GB energy system by £15bn/year (dependent upon the specifics of the system). 30% of the savings are in electricity distribution network costs, 70% are in electricity generation Capex and Opex, heating, hydrogen, carbon infrastructure. Significant flexibility is deployed on the Northern Powergrid networks and it can reduce distribution capacity requirement by around 30%-40%. Flexibility is used more frequently for balancing but during times of peak demand it is also used for peak reduction i.e. it the deployment of flexibility follows a combination of renewable generation and network demand.
Whole system or local optimisation
An approach that seeks to use distributed flexibility to minimise the cost of transmission and distribution networks acts to increase the annual cost of the whole energy system by £2bn/year compared to taking a the whole-system approach for using distributed flexibility.
Optimising for the whole system reduces overall costs but increases peak demand on the Northern Powergrid network by about 20%, compared to optimising transmission and distribution costs. i.e. the distribution system can be sized and used to minimise the whole systems costs which may mean that more network is required.
Distribution peak load sensitivity to sources of flexibility
We have modelled how the network peak load depends on the source of flexibility and considered the impact should any of the following not thrive: smart EV charging; smart thermal storage; and batteries. The conclusion was that if one of these fails to take off then the gap will be taken up by the other successful technologies and the benefits from flexibility will still be largely achieved with a significant reduction in peak loading. However the impact may depend on location with some technologies (eg smart EV charging) impacting all voltages (LV up) and some (eg large scale battery storage) largely impacting HV upwards. One flexibility technology can be substituted by other technologies with most of the benefits captured e.g. batteries and thermal storage can be alternatives for smart EV (and vice versa).
Sensitivity to offshore wind capacity
If the country delivers 80GW of its 120GW target for offshore wind, the shortfall will be filled by CCGT with CCS, onshore wind and solar. This reduction in offshore wind will not change the sources of flexibility on the distribution network but it does reduce the value of flexibility by 6% although the value is still significant.
Electrical heating options and system costs and benefits
For areas relying on electrical heating, heat pumps will need to be either ‘super-sized’ to deal with 1 in 20 year multi-day very cold spells, or resistive heating will be needed to supplement a “normal-sized” heat pump. The customer choices are to either invest in a larger HP system (higher direct cost) or to use supplementary resistive heating with higher system costs due to the need for more generation capacity and more network capacity ie there is a trade-off between the cost of heating appliances and the cost of the wider energy system. Overall it is cheaper to use resistive heating to deal with infrequent extreme weather rather than to ‘upsize’ the larger heat pump for such events. However, the impact is that distribution peak load increases by up to 30% if resistive heating is used alongside heat pumps, and more distributed flexibility is needed to reduce the electricity peak demand
Low Carbon Technology (LCT) growth investment planning tool
We have enhanced the existing business-as-usual LCT-growth planning tool so that it is regionalised for the Northern Powergrid network and so that it can model the impact of flexibility. We have used this more sophisticated tool to generate and test our HV/LV load-related costs for our ED2 business plan.
Flexibility markets
Early findings from multi-agent modelling of participants in flexibility markets indicates that the market clearing mechanism (eg Pay-as-bid, Pay-as-cleared, Dutch reverse auction) affects bidding strategies of the participants and consequently the flexibility capacity bid into the market and the price paid for the service.
Lessons Learnt
None. A comprehensive assessment will be made available in the final report due in late 2022. some of the iniital learning has been included in the Outcomes section.
