National Grid ESO is running its Demand Flexibility Service (DFS) to financially incentivise businesses to reduce electricity consumption when national demand is at its highest, typically on weekdays between 4pm and 7pm. Between November 2022 and March 2023, the ESO has announced that it will operate a maximum of 12 tests for participants.
Drax Energy Solutions has worked with its customers, including vehicle manufacturer Ford, to reduce their power demand by 30MW during these test periods – the equivalent amount of electricity needed to power 60,000 UK homes. This additional flexibility helps National Grid ESO balance supply and demand amid the ongoing energy crisis caused by Russia’s invasion of Ukraine.
Drax’s customers are paid £3,000 per MWh to reduce their power consumption and with a reduction in demand of 30MW observed during the test on 22 November , a revenue of £90,000 was achieved for participating customers.
Adam Hall, Drax’s Director of Energy Services said:
“This scheme provides a real opportunity for our supply customers with flexibility in their operations to play their part in strengthening Britain’s energy security this winter whilst cutting their electricity bills. We’re delighted that Drax Energy Solutions has become one of the very first approved providers, enabling our customers to benefit directly from participating in the scheme.
“We’ve been speaking with customers about the benefits the scheme offers their organisations and these conversations have been really positive. We’re delighted that customers including Ford have agreed to be part of the scheme, adjusting their manufacturing processes and offering more flexibility and stability to the grid whilst cutting their energy usage and contributing to their own net zero goals.”
The scheme was recently approved by Ofgem, and Drax is one of the first approved providers for DFS this winter.
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Notes to editors:
Drax Group’s purpose is to enable a zero carbon, lower cost energy future and in 2019 announced a world-leading ambition to be carbon negative by 2030, using bioenergy with carbon capture and storage (BECCS) technology.
Drax’s around 3,000 employees operate across three principal areas of activity – electricity generation, electricity sales to business customers and compressed wood pellet production and supply to third parties. For more information visit www.drax.com
Drax supplies renewable electricity to UK businesses, offering a range of energy-related services including energy optimisation, as well as electric vehicle strategy and management.
To find out more go to the website www.energy.drax.com
Demand Flexibility Scheme
The Demand Flexibility Service (DFS) has been developed to allow the ESO to access additional flexibility when the national demand is at its highest – during peak winter days – which is not currently accessible to the ESO in real time. This new innovative service will allow consumers, as well as some industrial and commercial users (through suppliers/aggregators), to be incentivised for voluntarily flexing the time when they use their electricity.
As part of a range of tools designed to help manage the electricity system this winter, National Grid are collaborating with energy suppliers/aggregators to allow participating consumers and businesses to reduce their bills this winter.
How the service works
- DFS began on 1 November 2022.
- ESO will run a maximum of 12 tests for participants entering from 1 November 2022, where participants will receive dispatch instructions with the opportunity to receive a Guaranteed Acceptance Price for tests.
- Four tests will take place in the first full month parties are signed up, followed by two tests in each subsequent month.
- During a DFS tender, once bids from participants are accepted, participants will contact end consumers/asset owners and request that they deliver demand turn down for the specified bid window.
- Parties can continue to sign up to the service after 1 November 2022.
- Response is required for a minimum of 30 minutes.
- Tender submissions are Pay as Bid.
- The service will run until March 2023.
For more information on the scheme visit https://www.nationalgrideso.com/industry-information/balancing-services/demand-flexibility