UK Power Networks kicks off 850 MW flexible electricity tender

UK distribution system operator UK Power Networks announced on Wednesday it launched its largest flexible electricity tender comprising 850 MW of opportunities for developers in London, and the east and southeast of England.

The London-based company’s head of flexibility markets, Alex Howard, told pv magazine that the announcement means the country’s major distribution network operator – responsible for 8.5 million customers – will manage “demand growth” and get more renewables connected to the grid.

“Last year, for the first time, and last week, for the second time, we've gone out to say, ‘Actually, we do have that challenge and we're going to use flexibility for that challenge',’” he said of the tender announcement. “But we're also going to use flexibility to help get more renewables connected because, in parts of our network, there is a big queue, both solar and wind farms and batteries, who wants to connect but who aren't yet able to.”

The challenge, he said, is rising demand created by customers relying on lower carbon-producing energy sources and more electric technologies. Project attrition for renewable projects is also posing its own problems, with Howard stating if the UK wanted to hit net zero carbon emissions, the more the company could do to “pull them [the projects] forward, the better.” He did not clarify how many projects were gridlocked.

Provisionally successful applicants will be announced in January 2024, with contracts commencing over the summer. UK Power Networks launched its first flexibility tender of 95 MW in 2019, and will continue to run annual flexible tender programs until the foreseeable future, Howard added.

UK Power Networks’ press release states the opportunities range from “just a few hours of flexible provision” and “as little as 10 KW per zone”, with the company looking for, “opportunities to create new revenue streams by ensuring that the region’s power distribution infrastructure is not over-loaded and renewable energy is prioritized.”

Flexibility means regulating the outputs between renewable energy generators – such as batteries and wind turbines – with customers who can “sign up to reduce their demand at peak times to benefit financially,” the release adds. It is the ability to change generation or consumption patterns to support the electricity system, rather than building new infrastructure, such as substations.

UK Power Networks' flexibility team, according to Howard, is tasked with finding smart solutions to rising demand.

“Twice a year, we go out and run that process, and try to sign those commercial agreements, different players, to kind of moderate how they use the network, in order to make better use of that capacity,” he said. If UK Power Networks didn’t follow this formula, and were to instead build the network for the size of what was coming, Howard estimates the company would spend £410 million ($503.1 million) more over the next five years to meet demand.

The UK’s solar PV cumulative capacity was 15,292.8 MW at the end of July, with newly installed capacity for the first seven months of this year reaching 643 MW, recent data published by Great Britain’s Department for Energy Security and Net Zero (DESNZ) show.