It is becoming increasingly clear that the UK’s current electricity markets cannot get the country to net zero – they can’t support the vast expansion of renewable electricity generation that is needed because they just aren’t flexible enough.
In April 2022, the Government announced it will undertake a comprehensive Review of Electricity Market Arrangements (REMA), which marks a once-in-a-generation opportunity to build a system that truly works for users and the planet. While there will be difficult compromises to be made going forward, it is crucial that users and their contribution to the system are placed at the heart of these reforms.
At the Association for Decentralised Energy’s (ADE) annual President’s Reception, hosted by Lord Duncan of Springbank and supported by Flexitricity, the ADE called for reform to see the system driving towards efficiency at all levels and enabling all households and businesses to make the right choice to electrify their heating, whether that is through individual heat pumps or collective heat network systems.
Speaking on Wednesday, Dr Alastair Martin, Founder and Chief Strategy Officer at Flexitricity, emphasised the importance of meaningful market reform, “Efficiency means using less energy, while flexibility means using energy when and where it’s cheap, abundant and green, or giving in back when it’s scarce, expensive or dirty.
“Flexibility is ready now – we don’t need to be incubated or trialled, we just need access. Not finicky, contingent access to side rooms and annexes, we need proper access to the markets and the networks that we can support. We are here to take everything that’s flexible, from batteries to heat pumps to electric vehicles to industrial processes, and align it to the lowest cost, best value, greenest resources available at the time.
“Today, energy flexibility, despite what I’ve said about its progress, about its availability, about its imminence, it punches well below its weight – for every flexible resource that Flexitricity brings to market, there are hundreds that we can’t, purely because of market rules.”
ADE President Lord Duncan of Springbank spoke to the audience about how decentralised energy technologies are essential to overcoming the worst effects of the energy price crisis – he said: “The challenge for this country with a slightly antiquated grid, with challenges in that way that it has delivered energy in the past and with an opaque way of creating bills, people are going to be uneasy – in this room are the people that can help address that. Government is actually at its weakest when it tries to pick winners, what it has to be able to do is help you deliver what is required to help people feel less uneasy.
“The energy price spike will pass eventually, but it will be quite some time before that reality is realised. What is needed right now, and this is when the flexibility of the grid becomes important, we are going to need to take energy from many different sources now and we are going to have to use it wisely, we are going to have to be more efficient in the way we transmit and transport energy, much more efficient in the way we insulate houses to ensure we are not wasting energy at source or at the point of use.”
Highlighting the need for an increased focus on decentralised energy technologies, Philip Dunne MP, Chair of the Environmental Audit Committee (EAC), said: “What we’re here to talk about today is REMA, which the Prime Minister announced in April, and which is a key component of the British Energy Security Strategy which Kwasi Kwarteng has brought forward.
“This is a really important moment to be able to put the decentralisation of energy onto the agenda – the grid will have to change very significantly in order to cope with the massive increase in demand and the changes in supply that are coming rapidly down the road. Getting access to the grid is one of the big impediments to rolling out capability and I think National Grid ESO and the Distribution Network Operators (DNOs) need to accelerate action in this area.”
