Standard content for Members only
To continue reading this article, please login to your Utility Week account, Start 14 day trial or Become a member.
If your organisation already has a corporate membership and you haven’t activated it simply follow the register link below. Check here.
The electricity system operator (ESO) at National Grid has been urged to develop a separate set of Capacity Market de-rating factors for embedded generators to reflect their “distinct characteristics” when compared to larger power stations.
The Panel of Technical Experts (PTE), which was formed to scrutinise the ESO’s annual Capacity Market report and its recommendations for auction parameters, made the suggestion in its own subsequent report to the Department for Business, Energy and Industrial Strategy (BEIS).
The panel welcomed the imminent introduction of a new obligation on distribution network operators (DNOs) to publish a standardised register of distributed energy resources connected to their networks.
Although this was not the case at the time the report was written, Ofgem has since approved an amendment to the Distribution Code named DCP350 introducing this requirement. The PTE said the change should allow the ESO to access “far better” data for it forecasting.
The panel also urged the ESO consider using this data to develop separate de-rating factors for distributed generators, rather than merely applying the same ones used for larger power stations.
De-rating factors are intended to reflect the expected availability of different technologies during periods when supply is struggling to keep up with demand. Participants in the Capacity Market bid and are paid according to their de-rated capacity.
The PTE noted assertions that embedded generators may be more reliable than larger plants both due to their lower average age and their configuration as a larger number of smaller units.
“Access to robust data is needed before any methodological changes are implemented, but we continue to believe that each technology within the Capacity Market should be de-rated according to its distinct characteristics,” the report stated.
BEIS published the report alongside a letter to the ESO from energy and clean growth minister Kwasi Kwarteng confirming the parameters for the next set of auctions.
Both the ESO and the PTE advised the government to procure 41.6GW of capacity in the T-4 auction for delivery starting in 2024/25 and none in the T-1 auction for delivering in 2021/22.
In line with the government’s commitment to set a target that is at least half of what was put aside when choosing the target for the corresponding T-4 auction, Kwarteng moved 400MW of capacity to the T-1 auction but made no further changes. The auctions are due to be held in January and February next year.
However, the minister did highlight that the analysis on which the decision was based did not take into account the potential impacts of the coronavirus pandemic. He urged the ESO as the delivery body for the Capacity Market to review its assumptions for supply and demand, with a view to making any necessary adjustments to the auction parameters in the autumn.
The letter also included the planned de-rating factors for interconnectors, which are as follows:
| Interconnector | Capacity | T-1 auction for delivery in 2021/22 | T-4 auction for delivery starting in 2024/25 | ||
| Range recommended by ESO | De-rating factor chosen by BEIS | Range recommended by ESO | De-rating factor chosen by BEIS | ||
| IFA (France) | 2GW | – | – | 50-91% | 69% |
| IFA2 (France) | 1GW | – | – | 50-91% | 71% |
| ElecLink (France) | 1GW | – | – | 50-91% | 75% |
| BritNed (Netherlands) | 1.2GW | – | – | 48-84% | 61% |
| Moyle (Northern Ireland) | 500MW | – | – | 24-66% | 49% |
| EWIC (Republic of Ireland) | 500MW | 54-99% | 59% | 24-66% | 49% |
| Nemo Link (Belgium) | 1GW | – | – | 46-88% | 68% |
| North Sea Link (Norway) | 1.4GW | – | – | 91-100% | 90% |
| Viking Link (Denmark) | 1.4GW | – | – | 45-80% | 52% |
Please login or Register to leave a comment.