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Flexibility in the Energy System

The term flexibility refers to the ability to react to the fluctuating needs of the power system, maintaining security of supply. Under requirements detailed in the Climate Change Act, the UK must reduce carbon emissions by at least 80% of 1990 emissions by 2050, and the UK energy market is rapidly transitioning to support this target. From a system primarily built upon large, centrally dispatched, flexible fossil fuel generation, the UK is manoeuvring to deliver increasing volumes of less flexible low carbon power. National Grid, as the System Operator (SO), recognises that “needs are increasing, most notably at the extremes” while conventional sources of flexibility are becoming less available due to continuing decarbonisation efforts.

Distributed Energy Resources (DER) and Demand Side Response (DSR) capabilities are growing steadily, expanding upon existing capabilities from pumped hydro and peaking plants to create a broader range of flexible energy assets. Flexibility is enabled in part by increasing digitalisation, helping to maintain balance on the system efficiently. Changing customer behaviours and infrastructure upgrades, including the roll out of Smart Meters, mean that demand is increasingly able to make valuable contributions towards maintaining security of supply.

Work in this space is led by Energy UK’s Flexibility Working Group. Originally established to feed into the Smart Systems and Flexibility workstream of BEIS and Ofgem its remit has now expanded to include leading on Energy UK inputs into the ENA Open Networks Project and the National Grid reform of Ancillary Services under SNaPS workstreams.

The Working Group recently set out Energy UK definitions of flexibility and positions on the future role of a DSO, and will soon set out roles and responsibilities for the future energy system, focussing on balancing responsibility and information provision. Further, in 2018, the Flexibility Working Group will:

  • Drive forwards BEIS and Ofgem actions from the SSFP, as well as identifying any gaps which should be addressed;
  • Aid in the development of a series of papers about the future of energy;
  • Provide a forum for members to engage with the Open Networks Project;
  • Support National Grid’s Power Responsive project;
  • Engage with the Smart Systems Forum on behalf of the energy industry.

Energy System Transformation

In order to transform the UK into a low carbon economy and allow the country to reach carbon emission reduction targets at lowest cost, there is a need to use our energy more intelligently. This means we need to develop smart, flexible and accessible systems that deliver efficient energy usage and increase UK companies’ competitiveness.

In 2016, Energy UK set up the New Energy Services and Heat (NESH) Committee to lead our work in this space and enable those energy industry actors outside of traditional supply and generation roles to join forces and become a part of the voice of the leading trade association for the UK energy industry. The Committee leads Energy UK’s work in engaging with government and supporting a set of smarter digitalised systems across power, heat and transport to unlock the estimated £17-40bn in benefits from a smart energy system.

NESH’s work programme enables the energy industry to drive forward the transition to a smart, flexible, low carbon energy system which meets demand at the lowest cost to the consumer, focusing on three primary work areas: flexibility in the energy system, the decarbonisation of heat and supporting low carbon transport (each supported by a dedicated working group). The NESH Committee examines the changing nature of the energy industry and the ways in which developing business models and a wide range of new and existing technologies will enhance security of supply and enable wider decarbonisation of power, heat, transport and industry.

In addition to the work being taken forward in flexibility, heat and transport, other priorities the New Energy Services and Heat Committee are taking forward in 2018 include:

  • The EMR five-year review, including future rule changes to the Capacity Market;
  • Ofgem’s Significant Code Review;
  • RIIO 2 and the changing role of network and system operators;
  • The changing role and classifications of distributed energy resources.

New Energy Services and Heat

Energy system transformation

In order to transform the UK into a low carbon economy and allow the country to reach carbon emission reduction targets, there is a need to develop smart, flexible and accessible systems that deliver efficient energy usage and increase UK companies’ competitiveness.

A holistic set of smarter digitalised systems across power, heat and transport needs to be supported by co-ordinated Government policies and in 2016, Energy UK set up the New Energy Services and Heat Committee to lead our work in this space and enable those energy industry actors outside of traditional supply and generation roles to join forces and become a part of the voice of the leading trade association for the UK energy industry.

Energy UK’s New Energy Services and Heat (NESH) work programme enables the energy industry to drive forward the transition to a smart, flexible, low carbon energy system which meets demand at the lowest cost to the consumer, focusing on three primary work areas: flexibility in the energy system, the decarbonisation of heat and low carbon transport. The NESH committee examines the changing nature of the energy industry and the ways in which developing business models and a wide range of new and existing technologies will enhance security of supply and enable wider decarbonisation of power, heat, transport and industry.

Three Working Groups support the Committee’s work in line with its focus, on system flexibility, the decarbonisation of heat and the decarbonisation of transport, each with their own programmes of work and priorities.

Low Carbon Transport

Emissions from the transport sector are largely unchanged from 1990 levels, which, combined with the fact that emissions from energy supply have been cut by 65 per cent since 1990, has resulted in transport recently becoming the largest emitting sector in the UK. There could be up to 10 million electric vehicles on UK roads by 2030 and a decade later the Government plans to phase out the sale of internal combustion engines entirely, representing an important opportunity to leverage the increasingly decarbonised electricity supply to cut transport emissions.

EVs will therefore play a key role in the future of road transport. Energy UK established the Electric Vehicle Working Group to provide a forum for retailer, generator and other energy stakeholder to develop positions on the optimal market arrangements for electric vehicles. The Electric Vehicle Working Group has enabled Energy UK to establish positions with which to influence government, most recently in a letter to ministers setting out the need for ambition in the Road to Zero and requesting ambitious targets for decarbonisation.

Published in 2017, ‘The Electric Vehicle Revolution’ sets out industry positions on the growing interdependency of transport and power and the facilitation of the uptake of electric vehicles. The Electric Vehicle Working Group is currently working on a follow-up paper to outline the key challenges and opportunities of integrating low carbon transport solutions into the energy system, as part of which a paper and consultation on smart charging standards was recently undertaken.

Other key work areas for the Electric Vehicle Working Group in 2018 include ongoing engagement with the Automated and Electric Vehicle Bill and continued close engagement with OLEV.

Energy UK also sits on Government’s EV Energy Taskforce and the GLA’s EV Infrastructure Taskforce, as well as a range of other groups.

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