WPD signs 35 deals for 119MW in maturing flex market

WPD signs 35 deals for 119MW in maturing flex market

09 October 2019

Elaine Knutt

Channel: Strategy & management

Western Power Distribution (WPD) believes that the flexible generation market has matured, after announcing a strong response to its latest tender round.

The DNO's Flexible Power brand, specifically set up to address the distributed energy market, signed contracts with 35 participants, including aggregators, industrial facilities, community co-operatives and other generators.

The 119MW of capacity, across 87 assets, meant that WPD secured its full requirement of flexibility services across the 17 Constraint Management Zones (CMZs) in the tender, a spokeswoman told Network.

Each participant has undertaken to respond to WPD's requests for power - or storage capacity - within 15 minutes.

The tender was Flexible Power's largest procurement exercise so far.

WPD's Network Strategy Manager Ben Godfrey said: "The results of this latest procurement round show a large increase in the amount of participants, proving confidence in DSO flexibility markets is growing and it's evident that more providers are able to participate confidently in distribution flexibility.

Confidence in DSO flexibility markets is growing and it's evident that more providers are able to participate confidently in distribution flexibility

"WPD has put considerable effort into developing these new markets; for  example, this is the first procurement round in which we have offered flexibility providers the option of securing a longer contract length of up to four years. We saw an equal split of preferences with 50% of respondents requesting longer term contracts while the other 50% chose one-year contracts.

"Feedback from our recent engagement with stakeholders identified the benefits that variable contract lengths can offer to different types of providers and we're pleased we were able to facilitate this within this round."

People now have a better understanding of this developing market. We had some success by sign-posting where we thought we would have a need for flexibility in the future

Flexible Power was first developed under a trial funded through Ofgem's Network Innovation Allowance incentive scheme.

In June 2018, WPD the announced that it would adopt the trial into "business as usual".  

The spokeswoman said: "People now have a better understanding of this developing market. We had some success by sign-posting where we thought we would have a need for flexibility in the future, so some providers decided to put generation capacity in that area. There was a commercial risk involved - a large housing estate might not get built - but overall it worked well."

"We do regular research with customers to make sure we do it correctly."

Flexible Power's approach includes providing details of the pricing structures it offers on its website.  

The latest tender brings WPD's total contracted flexibility to date up to 123MW. It plans to announce further flexibility locations in early 2020, opening a procurement window on 3 February 2020. 

 

DISCUSSION

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