Flexitricity qualifies to enter behind-the-meter assets into Balancing Mechanism

Flexitricity has become the first independent aggregator to qualify as an asset meter Virtual Lead Party (VLP) allowing them to enter ‘behind-the-meter’ assets into the Balancing Mechanism.

The VLP role was created to enable aggregators to create secondary Balancing Mechanism units comprised of multiple assets without becoming the registered supplier for those assets.

Flexitricity became the first VLP to trade on the Balancing Mechanism in September 2020.

In March 2021, Ofgem approved a Balancing Settlement Code (BSC) modification proposed by Flexitricity, which allowed VLPs to use individual asset meters for settlement, rather than just meters located at the boundary points between sites and electricity networks. The modification, designated P375, took effect in June 2022.

Flexitricity has now become the first BSC party to be registered by Elexon as an asset meter VLP.

The company’s chief executive Andy Lowe said: “I’m delighted with this news as it is another industry first and a major milestone for Flexitricity. As the first organisation to be qualified as an asset meter Virtual Party Lead, we can reduce the barriers to entry for smaller energy users, allowing more organisations to earn revenue from their flexible assets while helping National Grid to balance supply and demand across the system.

“Casting a wider net via individual asset metering allows more organisations to become part of Flexitricity’s growing virtual power plant, which is GB’s largest of its type and has recently passed the 1GW milestone.”

Speaking to Utility Week, Flexitricity founder and chief strategy officer Alistair Martin said the company is not yet ready to enter behind-the-meter assets into the Balancing Mechanism, adding that “in order to comply with the BSC definition of asset meters there is more work to be done.”

When asked when this would happen, he said “soon but I’m not going to put a date on it.”

Martin also highlighted the issue of operational metering requirements for the Balancing Mechanism, which he said remain unnecessarily stringent for small, aggregated assets.

In February, the Electricity System Operator announced it was relaxing these requirements for a capped 300MW cohort of assets. It said the accuracy requirement would be lowered from +/-1% to +/-2.5%, while the required metering reading rate would be dropped from once every second to once every minute.

Martin said normal requirements hold small assets such as EV chargers to the same standards as large power stations. He said if this standard was applied to every EV charger in the millions of homes across the UK, then “you’d have an astonishing data load”.

He said the requirements for assets in the 300MW cohort is fine for smaller assets but added: “What we actually want, what we’ve proposed to them, is that there is a graduated scale”.

Martin said he hoped this would be the outcome of the independent review of operational metering requirements which the ESO has promised to commission.

In October, Ofgem approved a BSC modification allowing VLPs to sell flexibility on the wholesale market. The Association for Decentralised Energy described it as a “watershed moment” for the sector.