UK Power Networks’ Distribution System Operator’s Day-Ahead Flexibility Market has delivered 4.4 GWh in a year – enough to power over 15,500 homes for a month – transforming the energy marketplace and opening it up to new participants.
More than 40 flexibility zones are now open and the network has run more than 150 flexibility competitions since April last year.
Alongside building new infrastructure, flexibility is part of the long-term solution to ensure there is enough capacity to connect green energy generators like wind and solar and low carbon technologies like electric vehicles and heat pumps.
Initially, the Distribution Network Operator (DSO) ran tenders for flexibility twice a year, but opening up a day-ahead market last year is enabling people with electric vehicles, heat pumps and batteries to participate in distribution, transmission and wholesale markets.
UK Power Networks collaborated with the National Energy System Operator (NESO) and aligned to its transmission balancing markets, to help participants decide which is right for them on a day-by-day basis. In particular, the UK Power Networks’ auction results are announced before participants need to decide their availability for subsequent NESO day-ahead auctions. When consulted in summer 2024, three-quarters of participants said that the timings of UK Power Networks’ market aligned with their wider commercial processes.
The market is supported by an advanced forecasting model that predicts network usage with unprecedented accuracy for the days ahead. This ensures that flexibility services can be aligned precisely with network needs. Since late 2024, UK Power Networks has also been ‘co-optimising’ its use of day-ahead flexibility with long-term contracts, choosing the cheaper option across these markets to drive the best outcome for bill-payers.
Participants use the Localflex platform, operated by EPEX SPOT. The platform streamlines bidding, trading, and settlement processes and avoids any clashes with NESO’s market structure. This coordination allows providers to “stack” revenues by participating in multiple markets without exclusivity restrictions, increasing profitability for participants.
Alex Howard, head of Flexibility Markets at UK Power Networks’ DSO said, “Our goal was to open the flexibility marketplace up to as many potential providers as possible. By offering providers more opportunities to engage and aligning services with NESO schedules, we’re helping to build a smarter, more adaptable energy network that supports our Net Zero future.”
Caspar Ruane, head of Asset Management (Grid Flexibility) at AMP said, “The introduction of UK Power Networks’ Day-ahead flexibility market has enabled us to significantly expand our service provision, providing flexibility services to an increasing number of UK Power Networks’ customers.
“AMP’s Grid Flexibility business aims to provide grid-constrained areas with electricity during peak times, when and where it’s needed. We are pleased to have been one of UK Power Networks DSO’s largest flexibility providers since 2019, and have always found the DSO team pro-active, engaging and very helpful.”
