Don’t worry, this isn’t some ‘50 Shades of Grey’ analogy for our energy system. This is a breakthrough moment with solutions to a hostile takeover of our valuable grid capacity.
For two years I have been working on flexibility, trying to support those least equipped to engage in and benefit from new local flexibility markets. This has involved listening to communities up and down the country, delivering beginners’ guides to flexibility events, writing blogs and a guide, in-depth conversations with Distribution Network Operators (DNOs) and feedback to Ofgem. Much of this work was captured in Regen’s Power to Participate report published in September which included a specification for policy makers, regulators and DNOs on how to make these new markets more accessible.
Last week I was at a board meeting with South Dartmoor Community Energy, who wanted my opinion on a new planning application for a gas peaking plant with a 6 megawatt (MW) grid connection. I was deeply concerned by this because, although we all understand there are times of the day when the sun doesn’t shine and wind doesn’t blow, there has to be a better way of managing a variable supply than installing more diesel generators and gas peaking plants to meet peak demand. There are other cleaner flexibility options, including reducing demand for short periods (demand side response) and batteries, which are rapidly coming down in price.
The problem
The key problems that I have with these new back-up fossil fuel burning power plants is that:
- In a very short space of time, diesel generators and gas peaking plant have accounted for almost 77% of the registered MWs of flexibility available to DNOs, who are following the rules set by the energy regulator Ofgem, to remain ‘technology agnostic’ and act as a neutral market facilitator. Whilst gas and diesel generator sets remain cheaper than batteries, that is the way the market will go without strong regulation to enforce carbon standards. Ofgem commitment to being ‘technology agnostic’ is not compatible with a climate emergency and our Government’s net zero by 2050 target.
- They are taking up space on our congested electricity network that could be used to connect more renewable energy to the system. They will sit there redundant most of the time, but taking up 6 MW of extremely valuable grid capacity is no joke. The Committee on Climate Change says we’ll have to quadruple low-carbon supply by 2050,[1] requiring us to upgrade the network, which comes at a price that we all pay through our energy bills.
- This is hugely demoralising for people worried about climate change. In Ivybridge, the good folk of South Dartmoor Community Energy started a petition against the planning application and received over 1000 signatures in just a few days. In September, East Devon District Council turned down a new gas peaking plant on the grounds it is not in line with the climate emergency. This is great where passionate people act fast, but what about all the places without community energy champions and climate activists standing up against applications like this, which seem to be getting through our planning system?
There are a few things I have been suggesting to DNOs for a while, but I had a breakthrough moment on Friday when the head of innovation and flexibility for one DNO didn’t automatically discount my idea because of how they are regulated. I now optimistically think this has to be the answer, having considered the following options:
- Higher carbon prices for diesel and gas generators – even in well-established carbon pricing schemes in the Nordic countries, the emissions cuts haven’t been steep enough to put us on the path to net zero.
- Ofgem could mandate that DNOs prioritise low carbon generation and demand reduction sources of flexibility, but this requires a major policy shift.
- DNOs break the technology agnostic licence condition and prioritise low carbon generation and sources of flexibility. I think this would make them very popular, but they risk lawsuits from diesel and gas generators and fines from Ofgem.
- We rely on people stopping this nonsense by using our planning system, but why let this happen in the first place?
And the answer is …
Very simple really and I wish the penny had dropped sooner. DNOs buy flexibility, they procure it using a framework and then get a contract in place for delivery. So, if a DNO takes a decision that they are committed to facilitating the transition to a low carbon energy system, and some have made statements to that effect, then surely they won’t mind…
… procuring flexibility with social and environmental value weighted more highly.
This would give people willing to reduce demand, renewables and batteries a chance to benefit from the admittedly low value that can be derived from local flexibility markets. But more importantly it would decrease the old school fossil fuel incumbents taking advantage of our new ‘smart, flexible energy system’. That isn’t that smart, clean or clever, and in the long run will end up costing us all more, and not just financially.
Thanks for reading, I hope you’ve enjoyed this blog and I’d love to know what you think.
[1] Committee on Climate Change, Net Zero: The UK’s contribution to stopping global warming, “Many networks will need to be upgraded in a timely manner and future-proofed to limit costs and enable rapid uptake of electric vehicles and heat pumps”.