Demand Side Response: UK Power Networks Deployment Strategy

Transcription

1 Demand Side Response: UK Power Networks Deployment Strategy

2 Safety and housekeeping No planned fire alarms Emergency exits Fire assembly points Toilets Mobile phones Data Protection - we record our findings and publish a report of the proceedings and our follow-up actions 2

3 Why are we holding this workshop? Discuss the details of proposed DSR strategy, service requirements, and procurement procedures Provide early visibility of programme timing and volumes Consult on our strategy with the existing DSR market stakeholders and experts Better facilitate the market s awareness and ability to provide the DSR services 3

4 Today s Agenda 09:30 09:45 WELCOME AND INTRODUCTIONS 09:45 10:05 UPDATE ON COMPLETION OF THE LOW CARBON LONDON Demand Side Response trials and key outputs ED1 DSR high level strategy and forecast 10:05 10:55 BUSINESS AS USUAL DSR - WHAT IS THE SERVICE AND THE DNOS REQUIREMENTS? Consultation questions and discussion 10:55 11:10 COFFEE 11:10 12:00 BUSINESS AS USUAL DSR - PROPOSED PROCUREMENT PROCESS Consultation questions and discussion 12:00 12:20 NEXT STEPS AND FIRST DEPLOYMENTS 12:20 12:30 FINAL REMARKS 12:30 13:30 LUNCH

5 David Boyer, Project Lead - Smart Network Plan, UK Power Networks Update on Low Carbon London 5

6 Low Carbon London Update The 28.3m Low Carbon London Programme has now completed the largest demonstration trial in the UK of DSR services managing distribution network capacity. Trials ran from 2011 to 2014 DSR contracts most often with third party demand aggregators, but also direct with providers 37 unique sites provided. Total 254 MWh of response, over 185 events Providers included generation and demand customers across a industry sectors 6

7 Low Carbon London Trial Analysis 90% of DSR requests saw response, the majority were on-time or early Detailed methodology was applied for calculating the reliable contribution to network capacity Majority of demand-reduction sites showed payback increase in demand at the end of an event, 15% - 270% of original load High 5 of 10 methodology provides a minimum level of base-lining accuracy for DNOs For detailed analysis of the trials please see report A4 in the programme suite: Industrial and Commercial Demand Response for outage management and as an alternative to network reinforcement 7

8 Low Carbon London Recommendations Opportunity to deliver savings on network investment through DSR Customer population connected to a substation is critical to success Early engagement with DSR providers is essential Visibility of site and portfolio response is essential for deployment These findings formed a key part of our DSR commitments for RIIO-ED1 8

9 RIIO-ED1 DSR Strategy UK Power Networks is committed to driving sustainable cost efficiency Innovation and smart grids a key part of this with DSR a leading solution Smart Grid solution UKPN RIIO-ED1 m Saving from DSR schemes 43.4 Total Smart Grid savings Deployment Scenarios: Defer substation upgrades Defer new-build substations Manage transfer capacity lost during construction Manage construction interdependencies to avoid derogations Manage impact of economic growth 9

10 RIIO-ED1 DSR Forecasts Benefits to network customers based on a forecast DSR programme addressing: c. 20 sites to be managed with a DSR scheme Each scheme covering an area roughly on average the size of post code outcode An average scheme size of 2 to 5 MW Up to 10+ schemes operating in parallel An average scheme length of up to 4 years 10

11 David Boyer, Project Lead - Smart Network Plan, UK Power Networks What is the Service? 11

12 What is the Service? The service (Demand Side Response) to be contracted for is to deliver and manage, upon UK Power Networks request, a net reduction in the load seen by the distribution network, or an increase in the export seen by the distribution network, for a site electrically connected to the specified network asset. The DSR service should have the ability to act (provide a response) reliably and consistently, in both magnitude and duration, throughout the specified availability windows, as per the contracted terms. Provision of the service includes ensuring the DSR assets providing the response, the monitoring equipment, and business operations are ready and able throughout the operational window to deliver the required performance upon request and are providing the required performance data. 12

13 Service Requirements Provider Types Service providers that will be considered include: Asset owners and operators directly providing the response Third party aggregators or service providers that manage the response of one or more direct providers Response mechanisms that will be considered include: Increasing export to the network from generation or storage assets Decreasing import from the network by reducing demand Decreasing import from the network by offsetting demand with embedded generation or storage assets Removing the demand from the network by islanding the customer network 13

14 Service Requirements Commercial agreement Contract variants for direct and third party service providers Payment structure - /MW/h and /MWh A standing no-value agreement initially made Individual proposals then tendered under those terms Detailed testing and acceptance procedures High 5 of 10 base-lining methodology 14

15 Service Requirements Defining Terms The service provided will be defined, per scheme, by: The MPAN identifier, declared MW capability, and response mechanism Period of availability when the service must be capable of responding Minimum required response time Maximum event duration for which the response must be maintained 15

16 Service Requirements Systems & Data The monitoring and operational systems operated by the provider shall: Monitor the DSR provider response at minutely resolution, in kw or kwh Provide UK Power Networks the data in real-time Respond to automated dispatch requests from UK Power Networks Control Engineers 16

17 Service Requirements - Location-specific 17

18 DSR Requirements Discussion 18

19 DSR Requirements Discussion Questions 1. Is what we are proposing something that you are interested in? How much of a limiting factor could the uniqueness of the UKPNs proposition be, if at all? Noting that no other DNO is offering this service. 2. If you were offering demand turn-down DSR services, would it be possible to limit demand payback? Do you have any experience managing payback? 3. Is the base lining methodology of High 5 of 10 practical? 4. Are the monitoring and data requirements reasonable? What impacts could these requirements have on potential providers or MWs offered? 5. Does what we are proposing look reasonable? Is there anything else that should be considered that would better enable market participation? 19

20 Tea & Coffee Break 20

21 Michael Clark, LCNF Tier 2 Project Lead, UK Power Networks Proposed Procurement Process 21

22 Proposed Procurement Process Proposing a two stage procurement process: 1 An annual request for information - Issued at the end of each year 2 Requests for Proposals for schemes then let on an individual basis 22

23 Proposed Procurement Process (1) An annual request for information will be issued at the end of each year: Identifying all sites with currently forecast need within the next two years Based on the annual load forecast update and internal investment plan Each scheme described by postcode locations and defining terms of service No-value standing agreements will be offered to any respondents RFI seeking to understand details of potential DSR capacity for each scheme. Information exchange enables market development and more informed investment decisions 23

24 Proposed Procurement Process (2) Requests for Proposals for schemes then let on an individual basis: Tenders will be requested after need for investment is confirmed Tenders submitted against the terms of the standing no-value agreement Band of expected pricing will be included in the RFP Detailed assessment criteria to be determined, will include: Cost Availability and location Response time and duration capabilities Seek to sign agreements over two months prior to commencement of service 24

25 Procurement Process Discussion 25

26 Procurement Process Discussion Questions 1. Given the first few years are critical in building confidence in this product, is UKPN being overly 'competitive' at this stage? 2. How much more or less attractive are multi-year contract terms. Is there a maximum practical length for contracts? 3. For contracts that have availability periods that run beyond 1600hrs, would Triad avoidance take preference to the DSR contract? 4. Is there a sustainable price point or price floor that you would be willing to disclose (in open or closed forum)? Noting that this product is sensitive to the availability period and pricing price. 5. Are there any alternative procurement approaches that we should be considering, while still adhering to national and international utilities procurement rules? 26

27 Next steps Timeline for first schemes (2015): Back Hill, LPN RFI already issued Pending next phase approval, RFP will be issued Q1 Successful proposals will be accepted and contracts signed Q2 Service to begin start of Q3 Aberdeen Place, LPN Pending confirmed requirements, next RFI to be issued Feb for next scheme Service likely to be required to start within 2015 Currently planning for the first of the system-wide RFI in Q

28 Open Q&A 28

29 Next steps Before we finish: Complete your feedback form Send us additional thoughts 29

30 Thank you