Open Networks 2021 Flexibility Consultations Summary and Response 16 December 2021 - Energy ...
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Open Networks
2021 Flexibility Consultations
Summary and Response
16 December 2021
1Background
ENA Open Networks undertook the following consultations to seek views from stakeholders on
developments to date under the Flexibility Services workstream:
• Flexibility consultation (Jul – Sep)
• Standard Agreement consultation (Aug – Oct)
This slide pack summarises the responses that were received both consultations and outlines how the
Open Networks project is taking the feedback forward this year. Additionally, it also outlines how the
project will consider this feedback further in developing the final work plan for next year.
It is to be noted that as a precursor to the final work plan, the project has recently consulted on the
high-level scope for next year. The responses from the high-level scope consultation and the flexibility
consultations above will be used to inform the final work plan that will be launched in January 2022.
2Headlines and Summary
• Majority of respondents were generally supportive of the topics being covered and the high-level
objectives set out in each product.
• Majority of respondents were aware of the Flex Figures published on the ENA website and found it
useful.
– Suggested improvements through inclusion of additional details (such as cost savings, technology type, time
of contracting etc)
• Majority of respondents generally welcome work on Open Governance; lack of uptake for user forum
was mostly attributed to:
– Low availability of resources/ limited capacity
– Lack of clear value to operational or commercial business processes from engaging
– High entry requirements
• Some respondents noted a need for a joined-up overview of flexibility market framework.
3Headlines and Summary
• Response to product specific questions are in the following slides.
• Three responses were concerns specific to a network company. They has been forwarded to the
relevant engagement groups within the relevant organisation to respond through their appropriate
channels.
• Response to the consultation on Standard agreement has been included in this slide pack as a
separate section.
• The recommendations for future work on various products have been signposted for
consideration in 2022 “you said, we will” section. The outcomes will be decided following a
review of both the responses received for the Flex consultation and the 2022-High level scope
consultation.
4Overview of respondents
5Responses received
• The Flexibility consultation ended on 24th Sep (additional 1 week extension of deadline offered)
• 18 responses received in total
– Academic All non-confidential individual
responses can be found here
– Cross Industry Representative
– Demand Side Response/Aggregator
– Large Energy Companies
– Supply Chain Companies
– Trade Associations
• WS1A P4 - Standard Agreement had a separate stand-alone consultation which received
additional responses from a Large Energy Company, a Generator and a Supply Chain.
6Spread of Responses received
Organisation Name Organisation Type
University of Southampton Academics/Research company
Citizens Advice Consumer Protection Party
Energy UK
Cross Industry Representative/Trade
REA
association
The ADE
E-Redes DSO (Outside UK)
Voltalis DSR/Aggregator
$$
Drax Generator
E.ON
Centrica Large Energy Company
Octopus Energy$$
Piclo Platform provider
Heimdall Power
M and W group
SMS plc
Supply Chain
Servelectric
Kaluza *Requested to remain anonymous
Supply Chain organisation* $$ Responded to Standard Agreement Consultation
Regen$$ ** Supply Chain $$** Responded ONLY to Standard Agreement Consultation
7General WS1A consultation
8Responses to Q1
Do you agree with our proposals within this consultation paper and if not, please provide us with
any rationale and alternative proposals?
• Overwhelming majority of respondents are generally supportive of the topics being
covered by WS1A and the work being done by Open Networks.
• One respondent recommended that energy efficiency is given equal weight within the
ENA Flexibility workstream, or that a separate workstream is established .
• Note: Product specific responses are addressed with the individual product responses
in following slides.
9Responses to Q2 - Eight received
Are you aware of the Flex figures being published each year on ENA Website? How does
understanding of GB’s growing Flexibility market size help you and how are you using this
information?
• Majority of respondents are aware of the existence of Flexibility Figures.
• Some respondents expressed concern over the granularity and suggested to add more details (
such as cost savings, technology type, time of contracting etc).
• Respondents supported the proposed improvements to the Flexibility webpages on the ENA
website.
10You said, we will
You said In 2021 we have/we are/we will In 2022, we will
• Need to have a narrative to explain the No further iterations of the Flexibility Figures are planned for In 2022, the license condition C31E goes into effect
progress of the use of flexibility services 2021. that mandates a requirement for the DNOs to produce
• Improve granularity and suggest to add more detailed distribution flexibility procurement statements,
details (such as cost savings, technology which will include more detailed quantitative
type, time of contracting etc) assessments.
In light of this, the current format of the Flexibility
Figures will be replaced by the requirements of C31E
and ENA will consider collating this information across
all DNOs to provide a UK-wide view. As part of this,
ENA will also consider including a short narrative to
outline progress, as suggested. Details to be confirmed
in the 2021 work plan.
Support the proposed improvements to the ENA ENA has launched an improved website for Open Networks
Flexibility website that has dedicated pages for each WS along with a list of
associated documents (presented in a clear accessible
fashion). ENA will incorporate the proposed improvements
to provide more information about DNO flexibility tenders.
Standardising approaches across DNOs and Alignment of DNO and ESO process has been kicked off In addition to continuing our work initiated in 2021, we
between DNOs and the ESO - addressing barriers with some of the products in 2021 [Procurement process are considering the introduction of two new products
to participation in flexibility markets (P2), Primacy rules (P5), Standard agreement(P4)] that will further look to address barriers in flexibility
markets by improving stackability of services (2022 P6)
and also improve dispatch interoperability (2022 P3).
11You said, we will
You said In 2021 we have/we are/we will In 2022, we will
One respondent recommended that energy efficiency This topic was raised with WS1A to review the
is given equal weight within the ENA Flexibility inclusion in the programme. The discussion to review if
workstream, or that a separate workstream is and how we can incorporate energy efficiency in to the
established programme is ongoing . The outcome of this
discussion along with the rationale of the decision will
be included in response to the comments received on
our high level scope document.
Need to bring more transparency in how DNOs The Common Evaluation Methodology (CEM) was In 2022, all DNOs will be reporting against licence
facilitate local markets for flexibility adopted by all DNOs in April 2021 to use a common condition C31E that will provide further transparency.
and transparent approach for assessing flexibility
against traditional options. Additionally, we have proposed to introduce a product
“Overarching common framework for flexibility services”
In 2021, we launched an “Flexibility Connections: to integrate the various aspects of flexibility into a
Explainer and Q&A” which is intended to help improve coherent framework. It is envisioned that this product
transparency around ANM enabled Flexible will set out a clear strategic view of further development
connections. This paper also helped flesh some of the required to mature processes across key aspects of
nuances of the interplay between Flexible connections flexibility (e.g. real time procurement, interoperability
and Flexible services. across platforms etc.) and will help to provide more
transparency on progress and direction of travel.
12Responses to Q3
Open Networks members are committed to implementing outputs and driving the benefits of
recommendations. Which product or area would swift implementation of the outputs be most
desirable?
• Would like to see clarity over areas which are deemed out of scope for the CEM.
• We also need clarity on how Whole Systems CBA fills the gaps that are out of the CEM’s scope.
• Preference would be to see faster implementation (and more non-network stakeholder
engagement) around the CEM of flexibility options compared to traditional reinforcement.
• We would be happy to facilitate further discussion on this with our members.
• ENA needs to ensure that processes for connecting flexible residential Low Carbon Technologies –
including EV-chargers and heat pumps – are working efficiently in preparation for mass uptake, so
that consumers remain positive about engaging in the energy market.
13You said, we will
You said In 2021 we have/we are/we will In 2022, we will
• Preference would be to see faster The CEM product team will undertake a multi pronged The inputs received form the workshops will be
implementation (and more non-network stakeholder engagement over Nov-Dec 2021. We will reflected in updating the tool (if applicable).
stakeholder engagement) around the CEM of reach out to key interested /affected parties, including The work undertaken with regards to option and
flexibility options compared to traditional those who have expressed interest through this carbon value will be put to public consultation in Q1
reinforcement consultation and earlier via the focus group 2022 .
• We would be happy to facilitate further discussion application to set up workshops to present the key
on this with our members. development undertaken to the CEM tool in 2021 and
seek their critical inputs.
ENA needs to ensure that processes for connecting Work on specific technologies such as EV and other We will continue working closely with the relevant
flexible residential Low Carbon Technologies – LCTs are addressed by parallel working groups with in working groups maintain a two way communication
including EV-chargers and heat pumps – are ENA and there are a number of initiatives being exchanging learning from those groups are well as
working efficiently in preparation for mass uptake, undertaken to facilitate rollout at pace. This includes feeding key learnings form Open Networks. The
so that consumers remain positive about engaging in digitalisation of the EV and Heat Pump connections dependencies of such working groups will be mapped
the energy market process out in the 2022 work plan for transparency and clarity
14Common Evaluation Methodology
WS1A P1
15Key headlines and summary
• Majority of respondents generally welcome Open Governance.
• Lack of uptake for user forum due to:
– low availability
– lack of clear value to operational or commercial business processes from engaging in specific User
Forums
– high entry requirements
• Few respondents expressed the need for clarity on how the Whole Systems CBA fills the
gaps that DNOs say are out of the CEM’s scope.
• CEM should include attributing a cost or benefit to impacts on third parties.
16Responses to Q4
What factors do you believe have led to the lack of response to the call to join the
User Forum for the CEM this year?
• Both the pandemic and the large number of industry consultations since June have reduced the ability
for stakeholders to be able to participate in further industry consultations or consider future-focused
market developments.
• The published commitment and ‘qualifications’ required from members of the forum was deemed by
some members to be excessive.
• The only way to increase engagement and interest in the User Forum is to clearly explain and
communicate the risks and opportunities to flexibility providers, as opposed to promoting the tool as a
DNO focused product.
• Addressing this issue by creating a less stringent approach would increase participation.
17Responses to Q5
We are keen to understand whether our model of Open Governance for the User Forum was a
factor in the lack of response, do you believe that a User Forum approach would be useful to
consider for progressing key products next year or are there alternative approaches that we
should consider?
• There was no consensus on the best approach for stakeholders to contribute to the development of key
products.
• Majority of the stakeholders believe organisations cannot currently be certain of committing to the time
required to focus groups, and running more open focus groups or ‘show & listen’ sessions/webinars,
supplemented by formal consultation would be more efficient.
• Some of the stakeholders believe an Open Networks rep to present to their members would be the best
approach.
18You said, we will
You said In 2021 we have/we are/we will In 2022, we will
Both the pandemic and a large number of industry This was useful information, since the response was WS5 (communication and Engagement) team will
consultations since June have reduced the ability for lower then last year. We reached out to stakeholders review inputs from several stakeholders to develop the
stakeholders to be able to participate in further who had not responded this year. They echoed similar most effective/efficient approach to organise
industry consultations or consider future-focused concerns for not responding to the consultation. consultations to maximise stakeholder responses.
market developments.
Majority of the stakeholders organisations cannot In 2022, we will be setting up a challenge group and a
currently be certain of committing to the time required dissemination forum that will enable stakeholders to
to focus groups, and running more open focus groups participate and provide input in ways that suit them.
or ‘show & listen; sessions/webinars, supplemented • The Challenge Group gives interested stakeholders
by formal consultation would be more efficient. a bigger voice in the programme and the
opportunity to shape the direction of the programme
• A wider dissemination forum will be open to public
and will meet once every 3 months.
Taking this feedback onboard, where input is required,
we will run targeted focus groups with stakeholders to
facilitate this as much as possible.
19You said, we will
You said In 2021 we have/we are/we will In 2022, we will
Few respondents expressed the need for clarity on This has been noted and will be considered as a
how the Whole Systems CBA fills the gaps that DNOs product element for 2022. The product will seek to
say are out of the CEM’s scope. clarify the CEM interaction with various other tools and
methodologies (including the WS4 Whole System CBA
framework) and how these fit into the overall Network
Options Assessment processes; with a view to identify
alignment opportunities in the short term, medium and
longer term.
CEM should include attributing a cost or benefit to The CEM and Tool is designed to evaluate only the In 2022, as a part of the product deliverables we
impacts on third parties. DNO’s costs and benefits across a range of propose to publish a paper clarifying the use of both
intervention options; whereas the Whole System CBA CEM and WS CBA detailing their similarities and
is designed to evaluate the total costs and benefits for differences.
a range of parties across a range of interventions.
20Procurement Processes
WS1A P2
21Key headlines and summary
• General agreement of P2 findings that concurrent or alignment of timelines would not be
of particular benefit to FSPs.
• Welcome the innovation trials and move toward real-time procurement.
• Pre-qualification and standardisation should be consistent across ESO and DNO activities.
• Agreeing more visibility of activities would be beneficial.
22Responses to Q6
Do you agree with the P2 team’s findings regarding the alignment of DNO and ESO timescales?
Please provide your rationale and any supporting evidence that we can use to inform our
approach, particularly in short – medium timescales (now – start of ED2)?
• Priority to move to real-time procurement.
• Prefer to have more standardised pre-qualification across DNOs.
• Alignment should be focused more on key requirements, testing, data requests and
technical specifications.
• Again, more focus on aligning and standardising applications valid for all markets.
23Responses to Q7
How could we further evolve alignment of procurement processes in future?
• More visibility and transparency of development of services, e.g. Cross-over points between Whole
System solutions interaction with WS1A.
• More visibility of requirements and standardisation of pre-qualification questionnaires.
• “We do not believe full alignment between DNO and ESO processes is possible given procurement
functions are in separate corporate entities.”
24Responses to Q8
Do you agree that the proposed improvements to visibility of requirements will be of direct
benefit to your sector of the industry, if so, please share your rationale and how you would utilise
this information? Do you have thoughts on how we can improve visibility further?
• “..supports the proposal to introduce a single webpage on the ENAs website collating all flexibility
procurement.”
• All other respondents are in agreement that improved visibility of upcoming procurement activities
will be of direct benefit to the flexible service providers.
25You said, we will
You said In 2021 we have/we are/we will In 2022, we will
Useful to move towards real-time procurement for Continue to work closely with the T.E.F consortium to We propose to evaluate and review output from the
DNOs. understand progress with real-time procurement trials. real-time trials and understand whether convergence
of timelines would be of value.
Standardisation and alignment of procurement Noted. Standardised pre-qualification has been
applications for all markets would provide greater identified and proposed in scope for WS1A P2 for
benefit. 2022.
Improve visibility of upcoming procurement activities Work with ENA and stakeholders to improve Will continue to work closely with stakeholders to
will be of direct benefit to FSPs. information on webpages and signposting understand what further improvements can be made.
requirements.
26Principles to Review Legacy ANM Contracts
WS1A P3
27Key headlines and summary
• All supportive of the Flexible Connection (ANM) exit route (using the G99 Form) and the
need for communication.
• However: several reported that whilst the G99 form is standardised the DNO processes
and approach to using it are not and this is an issue.
• Need to ensure more coordination / links to Ofgem’s A&FLC SCR.
• Generally agreement with findings of the P3 Report and next steps although mixed
support for the two-phase connection contract.
• Several (different) suggestions to time limit constraints on Flexible Connections (ANM).
• One response is anticipating set of principles to review FC(ANM) Legacy Contracts;
however this has been refocused to align more with A&FLC SCR minded to decision.
28Responses to Q9
Do you agree that there is an exit route, using the current G99 approach, for existing FC(ANM)
customers who want access to firm(er) connections? If not, what do you see as the barriers?
• Generally agree: but exit routes / process need to be aligned with the A&FLC SCR.
• G99 forms not applied consistently across DNOs/ processes that apply it differ by DNO making it confusing and
complex.
• Generally agree with approach because they have generic concerns with in perpetuity contracts and the asymmetry
of information (DNO v customer).
• Want to the communications re: the Exit Option / process to provide transparency on cost implications for the
customer; and be clear on the potential to reduce costs if wait until the A&FLC SCR proposals are implemented.
• Remove open ended connection contracts; replace with time restricted contracts, based on reinforcement timescales
/ availability of Flex. Services. If DNOs fail to meet timescales then customer rewarded for the flexibility provided.
However, customers should be still be able to choose a long term non-firm connection contract.
• Dislike term “Flexible Connection” as its only flexible for the DNO. Should be a Curtailed Connection.
29Responses to Q10
Do you agree with the findings of the Product 3 report and if so, which area(s) are of most interest
going forward?
• Majority of stakeholders support the deliverables identified esp. those made more pertinent by Ofgem’s A&FLC minded-
to-decision. ONP to be fully coordinated / aligned with the Ofgem’s intended approach.
• Generally supportive but customers have had issues with the G99 process and want to see it streamlined.
• Most support two-stage connection offer as non-firm connections could be used as a temporary measure to facilitate
quicker connection to the network whilst the DNO increases network capacity (via flexibility procurement or reinforcement.)
although these should be time limited and consistent.
– One stakeholder believes a two-stage connection offer does not enable discovery of true value of the flexibility; plus
maintains asymmetric bilateral negotiations.
• DNOs should avoid market-splitting Integration of different approaches to managing constraints: DNO flex tender products
and ANM contracts are managing constraints.
• Suggest introducing a “declining budget” of curtailable hours through the ANM schemes, building on the budgeted hours
that will be introduced for non-firm connections through the Access reforms. Curtailment “over budget” to be procured from
flexibility tenders so over time more curtailment would be addressed by flexibility tenders.
• One stakeholder has reservations about flexible connections, even on a time limited basis as that will impact the formation
and value of flexibility markets.
30You said, we will
You said In 2021 we have/we are/we will In 2022, we will
Coordinate / align activity with A&FLC SCR Conversations with Ofgem and ENA Regs Team Coordinated approach will be implemented to
underway avoid duplication of effort and make sure activity
sits with the team best placed to deliver solution.
Proactive signposting of exit (G99 form) options is supported Plans to complete this by Dec 2021
but…
DNO processes using G99 are not standardised and create We recognise the processes around the G99 form Identify and implement changes to connection
issues. Cost transparency required, incl potential benefits of are not consistent. We also appreciate that the agreements before 4/2023 to meet the needs of
delaying connection exit (SCR). Ofgem A&FLC SCR may require changes to the Access & FLC SCR decision. In parallel,
connection agreements from 4/2023. Both incorporate standardisation to address the
requirements are being discussed within the ONP consistency issues identified.
and ENA to identify where the activity best sits.
Most stakeholders supports 2-phase connection with one Two-phase connections generally supported but Coordinated approach will be implemented to
exception. with one stakeholder expressing reservations. avoid duplication of effort and make sure activity
Ofgem’s SCR activity also identifies this as a sits with the team best placed to deliver solution.
potential solution and activity be taken forward with
the appropriate team
One stakeholder – expecting legacy FC(ANM) contract Decision taken, with ON SG and Focus Group Coordinated approach will be implemented to
review to go ahead support, to align more with A&FLC SCR minded to avoid duplication of effort and make sure activity
decision. Resources to focus on standardising sits with the team best placed to deliver solution.
future connection agreements to meet the A&FLC
SCR needs and include transition arrangements for
FC(ANM) legacy contracts.
31Primacy Rules for Service Conflicts
WS1A P5
32Key headlines and summary
• No further projects to review as part of the product.
• Some questions about the scope and breadth of the product. These should be clarified in
the upcoming report due at the end of November.
33Responses to Q11
Are there any particular projects/reports we should be considering as part of our initial review of
work carried out on Primacy to date? This could include international examples.
• Most respondents did not answer this question specifically.
• Where they did, they generally confirmed that there were no other relevant projects.
• One respondent provided feedback on the wider product.
34You said, we will
You said In 2021 we have/we are/we will In 2022, we will
We are concerned about the lack of clear scope and definition of The product is currently developing a list of the relevant Primacy use Continue to review the
this product. We would like to see a more explicit description and cases . We are also defining a set of criteria that will be used to reduce the use cases to prioritise the
scale of the problem this product is trying to address. This could number of use cases and provide an initial view of those that are of next set of rules.
include a list of identified conflicts between DNO and ESO highest priority (using a scoring approach based on the agreed set of
products, a list of products and services these primacy rules would criteria). This will then help to shape the upcoming deliverables of the
apply to, as well as current regulatory and market pre-requisites for product, with a focus on tackling the higher priority Use Cases and
the implementation of these primacy rules. Scenarios first. The list of prioritised use cases will be published in 2021
• Primacy rules may artificially dictate the dynamics of the market Furthermore, we are currently developing Primacy Principles to help guide Apply the agreed
and dispatch patterns of flexible assets, instead of responding to the rules that will be created later in the product. One of these emerging principle to the Primacy
genuine system needs and signals. principles is the need to facilitate market competition. These are currently rules being developed
• we believe there is a risk that these primacy rules may create a being refined by the product team and the Primacy Focus Group. These
distortion to what would, otherwise, be a fully market and Principles will be published in 2021
system-led dispatch and utilisation.
With regards to high-level principles, key consideration should be The product team recognises that there is a need to ensure that This topic has been
given to real-time information availability and optionality and choice appropriate information is available to flexibility providers in order to offer identified to be developed
for participants. Flexibility providers should be able to assess the their services. under WS1B - P7 as
value of their services and optimise their participation in the most proposed in the 2022
economically efficient way. high level scope
document.
Additionally, a clear and consistent market framework needs to be The Primacy Rules will be developed in an open and transparent way, with Start to develop the
developed, with clearly defined roles, responsibilities and control stakeholder feedback at the heart of this process. As part of the product governance framework
structures. we will also develop a forward looking governance framework with
appropriate mechanisms to ensure they evolve to meet changing
scenarios, as required.
35Non-DSO Services
WS1A P6
36Key headlines and summary
• Half the respondents didn’t answer this question.
• Most of the respondents only spoke about the trading/sharing of capacity and ignored
curtailment of risk.
• Most of the respondents were more interested in the DNO/ESOs views on this question.
• General interest in seeing the results of any trials in the future.
• General agreement that this needs to be matured and will become more important as a
topic as time goes on (i.e. facilitating peer to peer trading).
37Responses to Q12-Nine received
Is the trading and/or sharing of capacity or curtailment risk of interest? What do you see as the
major barriers currently?
• Many stakeholders are interested in the DNOs views on barriers. Asking why two/data customers
can't come to an agreement as it is? See main barriers as information provision, conflict
management, DNO system study delays.
• "Theoretically of interest and could become more important over the next few years." Say DNOs will
have a better view and are interested in the DNO's view.
• Welcome trials and stakeholder engagement to progress this topic. Recommend the "product is
progressed with urgency."
• Certain barriers need to be addressed; like lack of market signals, lack of real time system charges,
and rewards for flexibility with a central control mechanism (i.e. with the DNO/ESO procuring it).
38Responses to Q12 -Nine received
Is the trading and/or sharing of capacity or curtailment risk of interest? What do you see as the
major barriers currently?
• Some stakeholders were there is industry interest in seeing the trading and sharing of
capacity delivered.
– Interested in curtailment risk being valued closer to real-time. Worried that this may be limited to
speculative trading.
– Potential benefits need to be clearly demonstrated in order to get stakeholders engaged and committing
to this workstream
• One stakeholder was unconvinced of value of capacity trading and sharing. Worries about
participants being "significantly asymmetric". Major concerns about there being a lot more
sellers than buyers (with short term sales on offer and no buyers wanting to invest).
39You said, we will
You said In 2021 we have/we are/we will In 2022, we will
• We would be interested in understanding the Held market facilitation workshops with a range of The wider Open Networks (ON) programme will
DNOs views on non-DSP services stakeholders, including DNOs, to understand general progress P6’s “considerations for future work” from
• We would be interested in seeing the results of responses to Q12 (report available). these workshops and the responses from this
any trials related to WS1A P6 . consultation.
WS1A aims to submit a better informed PID for “Non-
DSO Services” in the 2023 programme to build on
2022’s learning.
40Baseline Methodologies
WS1A P7
41Key headlines and summary
• Most stakeholders agreed with our approach to the delivery of alignment baseline
methodologies.
• Broad support for our proposal to continue the development of baseline
methodologies through the Open Networks from 2022 onwards.
• The need for technology specific baselines flagged.
• More detail on the timeline for DNO adoption of aligned methodologies requested.
42Responses to Q13
Does the roadmap outlined for the delivery and development of aligned distribution constraint
baseline methodologies (as detailed in the Product 7 interim report) meet the needs of the
market?
• Four of the responses confirmed their support with our approach.
• Two of the responses flagged the need for technology specific baselines, particularly
technologies that may be limited in responding due to intermittency and/or consumer
behaviour.
• Two responses called for more detail to be added to the P7 delivery timeline so that is
was clear when DNOs would adopt aligned methodologies.
• One respondent requested the analysis results to be made available so wider
assessment can be made on the methodologies market suitability.
43You said, we will
You said In 2021 we have/we are/we will In 2022, we will
While the timeline for continued consultation is Add clarity to the timeline to signpost when
noted, it was not clear that there was a target DNOs expect to adopt the 20/21 common Continue to update this timeline to reflect any
date for completion of the work. It would be methodologies and any future adoption of the developments as a result of the ongoing
useful to set a target date for aligned evolved methodologies as they are consultation for baseline methodologies.
methodologies. developed.
We would like to see a concise product map of We recognise that differing technology types
existing products and a comprehensive may benefit from a tailored baseline approach,
summary of technology-specific validation currently Technology Specific methodologies
mechanisms for each of the products. do not yet exist, we expect this to be an
The workstream will continue monitoring the
outcome of the ongoing evolution of baseline
Baselines are needed for emerging technologies methodologies will be directly influenced by use of the tool and use the learning to develop
such as residential flexibility. Home energy recommendation for further development of
DNO experience operating more diverse
technologies - electric vehicles, heat pumps, baseline methodologies for 2023
technologies for flexibility both through their
and other emerging tech which can show high existing and trial flexibility market activities,
variability across different households and and from the feedback of flexibility providers
further compounded by the natural daily operating within those markets
variability in the home
44You said, we will
We would encourage the ENA to make
available the results of their analysis based on Analysis of all baselines will be published We encourage any parties wishing to provide
historical datasets. The ENA could then get and available when the product concludes feedback on this analysis the Open Networks
further feedback on whether the results this year. team.
address market needs.
It is not clear whether and how this product is
The Primacy Rule Product (P5) is assessing
co-ordinated with the Primacy rules
any impact on other WS1A products as part
development. We would welcome a clear
of its work over 2021 and 2022.
overview of any interactions between the two
We will continue to monitor the product and
products and further engagement with the
action any impact recommendations from P5
industry throughout the year.
when they become apparent
45Apportioning Curtailment Risk
WS1A P8
46Key headlines and summary
• Broad agreement on caps and collars approach to apportioning curtailment risk with some
caveats:
– Greater transparency of curtailment apportionment mechanism.
– Flexible connections (ANM) as a temporary measure.
– Coordination with flexibility service procurement.
• One respondent very clear of objections to flexible connections and ANM in general, with a
view that generation connections should be firm by default with constraints managed by
DNO reinforcement / procurement of flexibility from connectees (who would be mandated
to offer such services).
– However, agreement that caps and collars does re-apportion risk although are of the
view that DNO is still not taking on any risk.
47Responses to Q14
We are exploring the use of curtailment caps and collars to apportion curtailment risk better; do
you agree with our high-level impact assessment on the various parties?
• Most stakeholders agree with high level impact assessment.
• The following were also noted:
– Desire to see how ANM mechanisms coordinate with wider flex markets as well as how DNOs
make flex procurement decisions coupled with ANM actions. Question whether ESO has
assessed impact on (flex?) market participation and revenue stacking.
– Notes that more transparency over merit order and curtailment methodologies is needed.
• One stakeholder fundamentally opposed to flexible connections but agree that risks do need to be
reapportioned. Feeling that DNOs use ANM to tackle constraints due to load growth.
48Responses to Q15
Do you support the use of caps and collars as described in the report?
• Most stakeholder were supportive of the approach.
• Some points were noted:
– ANM should be considered temporary measure and subject to maximum time limit
pending DNO flex procurement or reinforcement.
– Feeling that DNO not taking on any risk. Suggestion that all generators have firm
connections but with requirement to provide flex services similar to BM participation
requirements.
49Responses to Q16
Do you have any views on the alternatives presented? E.g. Peer-to-peer flexibility trading; an
incentive scheme similar to that currently used for Customer interruption/ Customer minutes
lost (CI/CML)?
• Most stakeholders support the proposals and these alternatives should be explored in
parallel (one stakeholder noted dynamic ratings to increasing capacity).
• P2P flex trading diluted form of DNO flex services. Preference for willow connection
boundary. Incentive scheme sounds attractive, acknowledgement of difficulties setting
targets.
50You said, we will
You said In 2021 we have/we are/we will In 2022, we will
Fundamentally opposed Connecting generation customers are currently liable for the costs (or a proportion
to flexible connections of the costs) associated with any network reinforcement required to accommodate
their connection. Where these up-front network reinforcement charges are cost-
prohibitive to a customer, Flexible (ANM) Connections offer a more cost-effective
and, typically, more rapid means of connecting. The FC(ANM) connection allows
customers to significantly reduce up front charges by accepting a degree of
reduction in network access rights – the connection will be curtailed when
networks are unable to accept the customers full load. Strong uptake of such
connections indicates that customers are broadly happy with these connection
offers.
Move from implementation product to recommendation product to be handed over
to SCR implementation team
• All feedback will be captured and noted as part of handover document
• Broad agreement with proposals means no material changes to
recommendations, support for alternative approaches (incentive schemes etc)
will be highlighted
• Concerns over transparency largely captured already
51Curtailment Information
WS1A P9
52Key headlines and summary
• Full support for using a Focus Group - on the proviso material and recordings are
shared with wider stakeholders, and supplemented with industry consultation.
• The priority curtailment information needs identified by the Focus Group were largely
supported.
• There is also support for focusing on the low regret quick wins, given the changes
being considered by Ofgem’s Access SCR.
• Two respondents suggested the choice of whether market participants decide to
process curtailment data themselves, or use a third-party, should be left to the market.
53Responses to Q17
We have used a Flexible Connection (ANM) Stakeholder Focus Group to help us identify the
specific curtailment information needs and priorities for current and potential users of Flexible
Connections; do you agree with this approach?
• Unanimous support for the Focus Group.
• Several caveated support by adding:
• Publish the supporting materials and recording.
• Supplement with wider industry consultation.
54Responses to Q18
Do the curtailment information requirements we have identified as a priority, with input from the
Stakeholder Focus Group, meet your needs? If not, what additional requirements are there?
• Most stakeholders agree the ONP should focus on the low regrets options and ‘quick
wins’ that are inline with the proposals from Ofgem’s Access SCR.
• One stakeholder agreed with the focus group requirements but surprised that 70% of
respondents only need the curtailment details at offer stage. Believes majority would
need this earlier and at least at discussion stage with network planners.
• One stakeholder noted they do not have any additional data requirements.
55Responses to Q19
In addition to improving curtailment data provision, Product 9 has also considered the
role of third-party curtailment information providers where more sensitivities can be
provided specific to customer assets. Would you consider using a third party for more
curtailment tailored information and if so, should we explore this option further or leave
it to the market?
• “Not clear how the use of third party curtailment information providers (TPCIP) helps either DNOs or
generators; DNOs will still have to provide the bulk of the data to the third party”- believe the best route is to
leave it to the market to decide whether there is additional value for generators using TPCIP.
• Requested to see more regarding timescales for delivering the modelling required by the DNOs. Have the
DNOs forecast the future resource requirement to carry out this work?
• Whole market needs to be provided with the same underlying data in a form that can be easily processed.
The choice of whether market participants decide to process the data themselves, or use a third-party,
should be left to the market.
• Role of the DNOs and ONP should be to provide the same data in a common format to enable customers
and third parties to extract the value of that information. ONP should abide by the open data principles
established by the Energy Data Taskforce, allowing the market to decide how it uses that information.
56You said, we will
You said In 2021 we have/we are/we will In 2022, we will
Full support for Focus Group provided material The sessions are not recorded as a general practice and as such is not Continue to use the focus group as
and recordings shared with wider stakeholders shared on a public forum. However, Materials of the Focus Group required to support the development
and supplemented with wider industry consultation workshops including the slides , meeting notes and outcomes are of solutions. All relevant materials
available. These will be signposted better. will be shared with wider
stakeholders.
Generally support the priority information needs Use the information to prioritise the Curtailment Information implementation Implement the Curtailment
identified plans Information plans
Support for focusing on low regrets options / ‘quick Continue with this approach Continue with this approach
wins’ inline with the A&FLC SCR proposals
The choice of whether market participants decide Given general appetite was to leave this option to the market it will not
to process curtailment data themselves, or use a feature in the P9 activity.
third-party, should be left to the market.
DNOs should provide the same data in a common Consistency is information provision has been identified as a key principle Consistency of data provision will
format to enable customers and third parties to in the activity and deliverables of the P9 Curtailment Information Product continue to be a key focus for the
extract value. implementation plans.
ONP should abide by the open data principles The ONP is guided by ENA’s Data and Digitalisation Steering Group The work of the DDSG will continue
established by the EDTF allowing the market to (DDSG). This group was created to ensure the benefits of accessible data to guide ONP and networks
decide how it uses that information and digitalisation are realised inline with the EDTF principles. The DDSG throughout 2022.
has developed two products: the National Energy System Map (NESM)
and the Energy Data Request Service available via ENA’s website. A Data
Triage Playbook guides networks on responding to data requests and
aligning to a ‘Presumed Open Data’ principle.
57Residential Flexibility
58Key headlines and summary
• One stakeholder sited problems faced by many customers purchasing a heat pump or EV
on fixed rate, non-time of use tariffs that use load during peak periods. Also, customer
variability and other asset-specific issues can make it hard for these technologies to meet
their full potential in existing flexibility services.
• One stakeholder identified a potential for ENA to address the problem of rising residential
demand at its core and mobilise residential flexibility with a new service procured ahead of
time.
• Two stakeholders shared the concerns of other aggregators, that the proposals from the
ESO to limit aggregation to Grid Supply Points (GSP) for its new response and reserve
products will seriously disincentivise residential propositions.
• One stakeholder expressed concern over the current conception of flexibility (and flexible
services) may preclude flexibility as a property of a wider system that includes dwelling
fabric (for thermal storage) as well as the bounded electricity network and its connected
appliances.
59Responses to Q20
Do you have any ideas on how we might better engage and encourage participation of
residential flexibility in flexibility service provision and identify any barriers that might currently
exist along with potential solutions?
• Two stakeholders shared the concerns of other aggregators, that the proposals from the
ESO to limit aggregation to Grid Supply Points (GSP) for its new response and reserve
products will seriously disincentivise residential propositions.
• One stakeholder noted the potential to for Open Networks to address the problem of
rising residential demand at its core and mobilise residential flexibility with a new
service procured ahead of time.
60You said, we will
You said In 2021 we have/we are/we will In 2022, we will
Concerns of aggregators, that the proposals from the This feedback has been passed on to the relevant
ESO to limit aggregation to Grid Supply Points department within National Grid ESO and will be
(GSP)for its new response and reserve products addressed through their appropriate channels
will seriously disincentivise residential propositions.
We believe there is potential to for ENA to address Noted. In 2022 we propose to review the flexibility
the problem of rising residential demand ( due to product definitions to reflect on the experience and
EV/HP) at its core and mobilise residential flexibility learnings from their deployment. Full details of the
with a new service procured ahead of time.-This recommendations received will be noted passed on to
service would be based on ‘avoided load’ rather than the product team for consideration
specific demand reduction
One stakeholder expressed concern over the current The work undertaken in the Open Network has been We will continue working closely with the relevant ENA
conception of flexibility (and flexible services) may technology agnostic. Ensuring that the development working groups ( that work closely with specific
preclude flexibility as a property of a wider system of flexibility market does not preclude any technologies) maintain a two way communication
that includes dwelling fabric (for thermal storage) technology/stakeholder form participating in the exchanging learning from those groups are well as
market has been and will continue to remain our feeding key learnings form Open Networks.
priority. In addition , in 2022 we have proposed the review of
standard flexible products definitions. The learning
form the past years will help us identify potential
barriers to market proliferation.
61WS1A P4 Workstream Consultation-
Standard Agreement
62Responses to Consultation
There was no specific questions asked regarding the published consultation, instead
Stakeholders where invited to review the contract and supporting detail in full and provide
feedback and their insights on the documents, it’s useability and accessibility overall.
We received 3 responses to the consultation, 1 supporting the Consultation, 1 gave no view and 1
challenged if the Standard agreement was fit for aggregators.
• Key themes from the responses were
– How will the ESO be using the Standard Agreement across it balancing services
– Thoughts on how the Standard agreement works with flexibility services provided by EVCP
– Challenges of services being delivered by EVCP
– Level of insurance and indemnities for smaller organizations
• Other areas raised not directly related to Standard Agreement
– Service delivery provided by EVCP
– Metering requirements for community providers and power to participate publication
63You said, we will
You said In 2021 we have/we are/we will In 2022, we will
The standard contract needs adjusting to ensure it Building on updates made in Version 1.2, which include, the removal of In 2022 we have proposed to further
works for aggregators, including the aggregation of singular terminology and the use of pluralised statements to reflect align the structure of schedules and
demand response from smaller assets. applicability to aggregators and aggregated assets documentation which can be used for
all existing and future products.
Version 2 incorporates more extensive changes which provide the
flexibility for providers to contract either as asset owners or
aggregators. This includes aspects such as the provision of requisite
documents for assets under development.
In terms of access, obligation on the Company to This clause has been further relaxed within Version 2.
comply with reasonable requirements for site access. The clause regarding site access will remain. The rewording of the
(e.g. health and safety requirements and having to clause means that the company will contact the provider to arrange
cooperate on scheduling – it’s not acceptable to many access rather than the company contacting the asset owner directly.
customers to give DSOs an unrestricted right of entry,
even with notice).
Harmonisation of the liabilities and Indemnities The liabilities and indemnities provision has been updated to align with
provisions across DNOs and the ESO. the ESO’s dual cap approach. Thus, under the Standard Agreement,
there is a general cap on liability for asset damage, with specific limits
for the DNOs and the ESO.
Specific indemnities as relevant to individual services, will be set out in
that service’s schedules. This allows for lower limits to be set for when
applicable across services which will remove any unnecessary barriers
to entry, in particular for smaller providers.
64Key Amendments to the Standard Agreement
Further Amendments to the Standard Agreement
Records and Audit Version 2 makes a distinction between financial, contractual and performance data and the ensuing
data retention obligations.
Confidentiality This clause has been amended to retain the simplicity in version 1.2, whilst also allowing the
sharing/publication of relevant data to enable greater industry transparency.
Dispute Resolution Version 2 adopts a layered approach to dispute resolution, with disputing parties having access to a
range of dispute resolution mechanisms, including negotiation, mediation, arbitration and expert
determination. This approach ensures that parties are afforded the opportunity to explore amicable
settlement through negotiation before recourse is had to other forms of dispute resolution including
mediation, arbitration, expert determination and litigation.
Inclusion of Community Updates have been made within Version 2 to recognise participation by entities other than ‘body
Bodies/Charitable Groups and Smaller corporates,’ thereby accommodating small scale flexibility service providers, community bodies and
Scale DER charitable groups. Overall, this ensures increased participation in the provision of flexibility services
and drives competition in the market.
Termination for Convenience Version 2 retains each party’s right to termination for convenience. The Product Team considered
that it would be particularly useful for smaller providers to have this right, so as to not be locked into
the contract.
Termination Due to Change in All references to ‘Change of Ownership’ being a material breach of the contract have been
Ownership excluded from Version 2. The clause has also been updated/relaxed to ensure that the Company
can only terminate for change of ownership, if the new Provider/ controlling entity fails to meet
reasonable due diligence checks.
65Provider Feedback and WS1A P4 responses
Provider Feedback P4 Response
DERs are defined in these contracts as: ‘the electricity generators, The definition is agnostic as possible and there is no primary source of
electricity storage or electrical load, and other Site and Provider flexibility service. All assets must meet technical requirements at
equipment, machinery, apparatus, materials and other items used for procurement stage (procurement rules). in regard to which definition
the provision of the Flexibility Services as described in Schedule 3’ – Electric Vehicle Charging Points fall under, they would fall under the
with a bit of creative thinking EVCPs could be considered to fall into this electricity load definition.
definition, but it is by no means perfect and certainly does not envisage
EVCPs or similar assets being the primary source of flexibility. We would
suggest including EVPs, or some generic wording around alternative
DERs, to accommodate for this.
ENA needs to ensure that processes for connecting flexible residential It is expected that any contracted service can be fully delivered. For
Low Carbon Technologies –including EV-chargers and heat pumps – aggregated assets we would expect that the Provider manages the
are working efficiently in preparation for mass uptake, so that aggregated portfolio to enable the provision of the contracted.
consumers remain positive about engaging in the energy market
66Provider Feedback and WS1A P4 responses
Provider Feedback P4 Response
We are asked to Permit / grant / secure a right of access to the Sites It would be highly unlikely that visit will ever take place by the
and the DERs and to inspect the DERs and add monitoring equipment contracting organisation however the right to inspect or have access to
to the DER if the Company so choose. Given these are people’s EVCPs contracting organisation owned equipment should remain As clause
(which may be leased from the original owner), this is very difficult to 4.1.7 states the contracting organisation will contact in advance and in
give practically. the case of domestic properties will contact the provider and not the
asset owner.
Disclose any change in circumstance which could affect the delivery of It is the providers responsibility to mange the portfolio within the
the services and notify DNO each time we change the DER providing geographical/ specified zone, this would include the addition/removal of
the service – Again, this is subject to our drivers complying with our end assets form the portfolios. As an aggregated asset provider it is
agreements, which is not totally within our control. expected that the portfolio delivering any service would be managed so
that it was capable of delivering any service that it was contracted for.
67Provider Feedback and WS1A P4 responses
Provider Feedback P4 Response
The indemnities included in some model agreements (against loss The Standard Agreement designed to align the General Terms and
or damage to any property, breach of the agreement for example) Conditions across the DNO's and ESO so that there is a consistent
are too broad and would not be accepted as part of a standard approach going forward. These terms were developed with the core
commercial negotiation. I have seen these included in some objectives of simplification, alignment and to be fair for all parties.
contracts and not others, so I wonder whether this is being included
by some DNOs over and above the standard terms.
The consultation notes that the ESO has structured its contributions The ESO will start using the Standard agreement initially with the launch
around the Dynamic Containment (DC) and Optional Downward of the new response and reserve products. Once that the new services
Flexibility Management (ODFM) services and is committed to have been established other existing services will look at wherever
adopting the Standard Agreement for its future product launches, but possible move to using the Standard terms. This will require and industry
it is not clear whether and how this agreement will apply to other consultation as required by EBGL and Clean energy package legislation.
ESO products. As noted in our response to the recent Flexibility
Consultation, a lack of engagement with the ENA Open Networks
project can lead to a limited understanding of how changes
proposed by the project will apply at the grid level until those
changes are put forward for implementation. We would therefore
suggest that the ESO communicates its plans on adopting the
proposed Service Agreement separately via relevant communication
channels. We would expect that communication to include a list of
current and future ESO balancing services that this Agreement will
apply to, subject to approval of the changes by Ofgem. We would
also welcome clarity on timelines for adopting the agreement by the
ESO.
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