National Grid ESO has published its 2019 power responsive annual report, setting out the progress made over the past year in flexibility.
Published on 14 April, the report set out that markets continued to deliver opportunities for demand side flexibility (DSF) providers in 2019, with their share of the market continuing to grow. The report attributed this to greater volumes being bought by the ESO and the lowering of the minimum unit size from 50MW to 25MW in the Fast Reserve market. Prices were also noted as remaining broadly stable while the introduction of a new weekly frequency response auction in November 2019 should provide further opportunities for DSF providers in 2020.
Despite this, the report warned uncertainty continued to be a theme in 2019 – having been reported in 2018 – with demand side providers facing challenging times owed to many changes to markets, charges and regulations impacting their revenue streams. There was also mixed success in the Capacity Market for demand side flexibility, with market share and cleared price remaining broadly the same for longer-term auctions but participation and success falling in the year ahead auction. Less than 100MW was successful in 2019.
Looking ahead, ESO’s strategic goals for 2020/21 when it comes to power responsiveness include informing the development of inclusive markets for flexibility, which through competition can deliver economic efficiency, carbon reduction and innovation. It will also look to allow customers and DSF provider perspectives to be heard by policymakers and market actors, before feeding these perspectives into the development of flexibility markets, policy and regulation, while also aiming to identify and champion the removal of barriers to flexibility entry and participation.