Posted on: 05/04/2019
After the System Operator published its Summer Outlook, it is clear that summer demand can be met. In this blog, Head of Marketing, Mike Shirley looks at the issues facing National Grid this summer, and what market participants can do to meet the needs of the grid.
In the first Summer Outlook since the Electricity System Operator (ESO) was spun off from the Transmission Owner, peak electricity demand for this summer has been estimated at 33.7GW, a reduction of 200MW on last year’s peak summer figure. This continues the trend of reducing peak demand year-on-year, now 2.6GW lower than summer 2016. This has also been the case in recent winters, something which we outlined in the Power Market Update section of our latest Monthly Briefing Webinar.
This shouldn’t come as a surprise given that the total minimum generation available has been published as 39.8GW. What represents a far greater challenge for the ESO in the coming months, is balancing the system during times of high generation and low demand.
When a large amount of (usually) solar power hits the grid in summer, contrasting against low demand, it becomes difficult to find ways of keeping the system within operating parameters. We’ve already seen one example of how this can affect energy markets this year, when system prices went negative for six consecutive hours on Sunday 24th of March, due to unseasonably warm weather creating an unexpected influx of solar power.
The key point then, is National Grid’s confidence that they have the necessary tools to keep the system balanced this summer. The ESO are clear that they do not expect to have to ask inflexible generation (e.g. solar, wind) to turn down during times of minimum demand during summer 2019 - but are able to do so if required.
The usage of tools such as demand turn-up and frequency response have become more prevalent in recent years, due to the changing nature of the system and proliferation of renewables. This offers opportunities both to demand side response providers who can ramp up operations to take advantage of the excess of cheaper power, and also for battery storage projects capable of providing almost immediate frequency response.
Gas fired generation also plays a bigger role in the summer, with its flexible nature meaning it can dovetail with renewables to cover off intermittency issues. It is also able to respond to requests from the ESO relatively quickly. Whilst National Grid stress the need for accurately and timely physical notifications in the Summer Outlook, it is clear from the publication that gas generation will be one of the preferred methods to address system imbalances moving forwards.
As an aside, the increased requirement for gas-fired electricity generation, has led National Grid to estimate greater gas flows into the UK via Liquid Natural Gas (LNG) tankers this summer than in 2018, meaning that the gas system will need to be operated more flexibly too, as LNG flows are less predictable thank supply from the UK continental shelf.
With regards to imports and exports, the ESO has outlined that they see no new operability issues being caused by Brexit. Regardless of the manner in which we leave, power and gas will continue to flow across borders, thanks to the agreement of new fall-back access rules in the event of no-deal. The only change in that scenario would be trades occurring under World Trade Organisation (WTO) rules.
This combination of factors has seen National Grid opt to use a combination of demand turn-up, flexible gas generation and frequency response services in order to manage both Rate of Change of Frequency (RoCoF) and balancing issues, as intermittent generation keeps the system in a state of flux over the summer months. National Grid’s needs for a smarter grid are being reflected in both the assets on the network and the services they deliver – which will only become more common as we further decarbonise the energy system.
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About the author
Mike Shirley joined SmartestEnergy in March 2014 to head up Marketing, Insight and Product Development. His career before then had focused on the technology sector, working for major brands including EE, Orange and Colt Telecom. The expertise gained in the fast-moving telecoms sector is now being used to help SmartestEnergy better understand how to anticipate and meet customer needs to support its unique position in the energy market. Mike has been at the forefront of building SmartestEnergy’s market-leading renewable electricity product offering. Most recently he has led the development of the UK’s first certified 100% renewable electricity supply product, which is certified by the Carbon Trust and enables corporates to report zero carbon emissions in accordance with the Greenhouse Gas (GHG) Protocol Scope 2 Guidance.