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Flexitricity proves Demand Side Response delivers
When I heard that DSR providers could enter the Capacity Market two years early, it was an opportunity I had to seize.
Who doesn’t like getting in before the hordes? Great news for our valued Energy Partners; they could earn additional revenue while the Flexitricity team gained experience of the qualification and delivery processes, enhancing understanding and knowledge for subsequent years.
The Transitional Arrangements (TAs) were never going to be a gold rush. The TAs carried restrictions that meant they were not for everyone; we took only a small subset of our Energy Partners through that process. And so, in January 2016, Flexitricity secured 37.9MW of Capacity Market (CM) obligation in the first CM Transitional Auction, to be delivered by six Capacity Market Units. The gun had fired, the race was on: gain test certification for the DSR units and be ready for 1 October 2016. Together with our Energy Partners, we completed this with weeks to spare.
And onto the Delivery Year itself, during which each Capacity Provider must prove that they can physically deliver on their obligation. After all, no-one expects to be paid on a promise. Along with all other Capacity Providers, we must demonstrate full output on three separate occasions during the winter. These are “Satisfactory Performance Days”, or SPDs, and they have great importance in the operation of the market. If you don’t perform, you won’t get paid – it’s as simple as that. Providers who have not proven three outputs by the end of the delivery year must repay all payments received. That’s one huge naughty step to find yourself on.
I’m delighted to confirm that all of Flexitricity’s CMUs have successfully demonstrated satisfactory performance, solidifying our position as the most trusted aggregator in Britain, and a reliable provider of capacity for GB electricity consumers. In fact, most of our CMUs secured all of their SPDs before Christmas, many through response to reserve calls (like STOR) or frequency response events. For others, we co-ordinated test runs – not a simple task when each CMU is made up of the sites of several different Energy Partners.
And we’re back at the mill. Flexitricity is the only demand response aggregator to tackle the main CM head-on and take strong positions in the mainsteam auctions. For most of our customers, we now have four years of contiguous CM revenue lined up. We’re busy now taking those units through the DSR test process, on into delivery from October, and demonstrating satisfactory performance in the coming winter.
But I struggle with the adjective “satisfactory”. It makes me think “adequate” or “acceptable”, or maybe just “so-so”. Given the effort and diligence which our Energy Partners and the Flexitricity team applied – gaining a full house for all DSR tests, for SPDs and for capacity to deliver – we surely need a better word.
So I’m making a move for a change to the Capacity Market Rules. Forget SPDs. Let’s call them Excellent Performance Days.
Written by Jill Cox, Sales Operations Manager at Flexitricity