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Centrica LEM achieves ‘breakthrough’ as flexibility trading platform goes live

The LEM operates in Cornwall, one of the most constrained areas of the UK. Image: Centrica.

The LEM operates in Cornwall, one of the most constrained areas of the UK. Image: Centrica.

Centrica is lauding a ‘world first’ as its Local Energy Market (LEM) enables National Grid ESO and Western Power Distribution (WPD) to simultaneously procure flexibility from the same platform.

The final piece of Centrica's Cornwall LEM has now gone live, allowing both WPD and National Grid ESO to place bids for flexibility, enabling them to indicate when they will need an increase or decrease in generation or consumption to balance the grid or manage a local network constraint.

These bids are then matched with offers from sellers through auctions that can run from months in advance to intraday. Sellers then receive a financial reward for their services.

The platform manages the process for both sides, including contract creation and baselining and settlement.

A clearing engine has been built for the platform by Belgian advanced analytics company N-SIDE, which takes the bids and offers and finds the optimal clearing solution, taking into account grid and asset constraints.

The transmission and distribution networks are able to co-ordinate their procurement to avoid conflicting signals, making it the first time in the world both have simultaneously procured flexibility on the same third-party platform, Centrica said.

Colm Murphy, electricity market change development manager at National Grid ESO, said the potential is “really exciting” as the system operator looks to unlock more flexibility and greater cost benefits for consumers.

“Exploring the provision of flexibility through a local energy market is a first for us and even though we’re in the early stages of the trial, we’re looking forward to evaluating the results.

“In particular we’re keen to understand how flexibility can be procured efficiently and cost effectively between different markets,” he added.

The Cornwall LEM has been operational since 2017, when the first piece of technology – a 1MWh redT redox flow machine – was installed at working farm and holiday retreat The Olde House.

Over the past two years, solar PV and sonnen batteries were installed at 100 homes in the region. Three sizes of batteries were installed: 5kW, 7.5kW and 10kW, and this phase of the project completed in May.

Over 125 businesses were also kitted out with a variety of flexible low carbon energy technologies and monitoring technology.

Current± took an in depth look at the LEM as the installs were finished, detailing all the components of the trial.

The LEM is being part funded by the European Regional Development Fund and is one of several projects taking part in Ofgem’s regulatory sandbox.

Partners in the project are National Grid ESO, WPD, N-SIDE, Exeter University and Imperial College London.

Pieter-Jan Mermans, director of optimisation at Centrica Business Solutions, said: “Improving grid flexibility benefits everyone from generators to consumers, and these trials represent a major step forward. We are hugely grateful to the householders and businesses across Cornwall who have embraced this trial with open arms, and we look forward to providing a full update after the trials conclude in spring 2020."

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