The past, present, and future of energy flexibility in GB

Over the last 20 years, Flexitricity has pioneered demand side response services in Great Britain. In that time, the company has reached many milestones and accomplished many achievements, culminating in the largest and most diverse virtual power plant (VPP) operating today. With over 1GW of available flexible capacity, controlled from its Edinburgh office, Flexitricity is displacing the need to construct a physical power plant equivalent in size to the UK’s latest large gas-fired power station, Carrington.

Aggregating distributed assets has a significant impact on GB’s net zero goals and demonstrates that smaller contributions add up to big changes.

So, how did Flexitricity get to where it is today and what does the future of flexibility in GB look like?

The journey to one of GB’s leading virtual power plants (VPP)

Dr. Alastair Martin founded Flexitricity in 2004, following the Californian crisis. His inspiration came from recognising the necessity of flexibility and the inefficiency of large power stations in providing it, while consumers have the potential to support flexibility. Working in the water industry at the time, he realised that energy users could be more flexible than power stations. If energy users could be combined and controlled, then you could have a large flexibility asset that could be delivered to the system operator as a single unit.

During the initial years of the company, the energy landscape was significantly different to what it is today. There were significantly fewer variable renewable energy (VRE) sources connected to the grid, which meant flexible capacity wasn’t used to match the fluctuating generation levels we see caused by wind and solar today. Back then, flexibility had two main functions. The first, as Alastair calls it, was to “catch falling power stations” by compensating for the drop in supply when power stations shut down. The second was to handle peaks in demand, such as the 2010 winter “peak of peaks” reaching the record high of 61GW.

Reflecting on the past flexibility landscape, Alastair commented, “We were the first open market aggregator to go live, but back then aggregation wasn’t a big part of the energy picture. Most of the flexibility was created by running power stations at part load. That was inefficient and created a lot of waste. Aggregation immediately helped to eliminate that waste.”

The rise of variable renewable energy sources like wind also changed the nature of flexibility in GB and with it Flexitricity’s role as an aggregator. “Our job is less about reducing the inefficiencies of coal and gas,” commented Alastair. Adding, “Now it is about matching the natural ebbs and flows of renewable generation, which are largely determined by weather conditions. This has led to a qualitative change in the nature of flexibility and the move away from conventional power plants to virtual power plants.”

The participants that make up Flexitricity’s 1GW VPP are varied, but collectively they contribute enough capacity to counter the need to build a utility-scale fossil fuel power plant equivalent in size to the UK’s largest gas-fired power station. Having doubled in size over the last three years, Flexitricity expects its VPP capacity to double again over the next few years.

Along with being the first open market aggregator and 1GW VPP in the UK, Flexitricity has hit several other significant milestones over the last 20 years. It was the sole aggregator to participate in National Grid ESO’s Enhanced Frequency Control Capability trial, which tackled frequency challenges created by the growth of renewable generation. Soon after that, it was the first organisation to dispatch behind-the-meter flexibility in the Balancing Mechanism with gas CHPs as a supplier and then again with a battery energy storage system (BESS) as a Virtual Lead Party through the BM Wider Access route.

The future of flexibility in GB and the growth for ad hoc flexibility

To ensure a successful transition to a truly net zero economy, vastly more flexibility capacity will be required in the future. Estimates suggest that in the EU alone, flexibility will need to increase by a minimum of 600%. In the UK, similar increases in capacity are required to meet net zero goals and handle the electrification of larger parts of the economy. Rough estimates suggest that the theoretical peak demand of electric vehicle charging in the UK – that is, if every household had an electric vehicle and everyone decided to charge them all at the same time – is around 0126GW – more than twice the record “peak of peaks”.  In itself, that’s not a plausible event, but it does illustrate the size of the challenge.  It also shows the size of the opportunity, because from the electrical viewpoint, EVs are just batteries on wheels – a fast-growing flexible resource that can choose when to charge in order to capture the greenest electricity available

As the need for more capacity grows, a greater number and range of organisations will need to take part. The build out of BESS has seen some of the most rapid growth in flexible energy assets recently, and working with a route-to-market partner such as Flexitricity offers asset owners an effective means of monetising their flexibility. But more industrial and commercial (I&C) organisations will be needed to ensure the system operator has the flexibility required.

Commenting on the broadening scope of organisations able to take part in flexibility services, Flexitricity CEO, Andy Lowe, said, “Flexitricity began its journey working with many industrial and commercial partners. Over the years, changes to the market have made it harder for them to participate in flexibility services. But upcoming modifications to market codes, set to be implemented within the next 12 months, will make it easier for I&C organisations to take part. Because of our pedigree of working with I&C customers during our earlier years, we’re ideally suited to help them access the GB energy markets, giving them new revenue streams while decarbonising their operations.”

An important strategy for industrial and commercial organisations is to embrace ad hoc flexibility, which means being flexible with their approach to your flexible capacity. “Organisations can reserve their business-critical assets to meet their priorities and be flexible with the capacity they can modulate” commented Alastair. Adding, “They do not need to be flexible all the time, and they only need to focus on the things they can realistically be flexible with. At Flexitricity we fundamentally structure everything so organisations can participate or take themselves out when they need to.”

As renewables grow and more of the economy becomes electrified, the need for more flexible capacity grows too. Flexitricity created and operates the first, most advanced and diverse flexible energy portfolio in Great Britain. Its 1GW virtual power plant (VPP) brings together a wide range of asset types across sectors, and all participants can earn revenue and reduce their carbon emissions while helping to balance the grid. New markets will soon allow a broader range of organisations easier access, and Flexitricity can support them to make the most of their ad hoc flexibility. Get in touch to find out how your organisation can start benefiting from Flexitricity’s services as part of the UK’s largest virtual power plant.