GB blockchain pioneer Electron has reported achieving a “first-of-its-kind” local flexibility marketplace on Orkney.
Milestones of the project TraDER on the Scottish island included real-time peer-to-peer trading between local wind resources and customers and the provision of flexibility services to the grid.
Underlying these were a new ‘neutrally facilitated market’ model, in which the distributed system operator enabled the transactions but did not directly procure its own flexibility products.
The two-year project also demonstrated aggregating visibility of national and local requirements for demand turn-up on the same market platform.
Project TraDER, which was led by Electron, was designed to establish a bottom up transactive energy system. The initiative was supported by the Department of Business, Energy and Industrial Strategy’s FleX fund and other participants including CGI, Community Energy Scotland, EDF, Elexon, Energy Systems Catapult and Kaluza, as well as National Grid ESO and Scottish and Southern Electricity Networks.
Orkney was selected as having both high renewable energy generation and curtailment, with the aim to reduce the levels of curtailment through more efficient management of generation and flexible assets.
The project focussed on two flexibility market designs. One was a ‘demand turn-up’ distribution-level market, in which wind turbines that were being curtailed could pay local flexible resources to create space on the local network to bring them back on-line.
The second was a national-level market, based on National Grid ESO’s Optional Downward Flexibility Management product, in which ESO procured and paid for demand turn up from the same set of distribution connected assets.
Among the findings are that demand-turn up could be delivered on a best efforts, upside-only basis, supporting a win-win-win market in which renewable generators can increase revenue, customers can access lower power prices and the grid benefits from a higher proportion of power supplied by renewables.
Another finding was that the volume of curtailed wind today far outweighs the volume of flexible capacity ready to offset it. While trading could be mobilised rapidly with consumers in the project, new consumer service propositions to encourage them to enrol and trade with new assets along with policy support are recommended.
Approximately 24,000 micro-trades were undertaken totalling 8.3MWh during TraDER, indicating that automation of asset dispatch is key to furthering friction-less participation. However, the dispatch and response time of flexible resources needs to inform market design. Some such as hot water heaters and batteries can respond to price signals in real-time, but others such as hydrogen electrolysers required advance notice.
Other findings were the need for coordination of local and national flexibility requirements and data integration across market and system operation platforms – an issue that Scottish and Southern Electricity Networks is currently investigating further.