Modo presentation at Flex Provider roundtable

Transcript

1. Alex Done
   Head of Research
   alex@modo.energy
   Preparing for short-term, dynamic flex markets
   Learnings from grid-scale flex
   

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2. Quentin Scrimshire
   CEO, Modo Energy
   We’ve launched a free plan. Go to modo.energy to see what all the fuss is about.
   Data is fundamental to the future
   energy system.
   Let’s build.
   🚀
   

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3. Power sector
   GB Power
   Sector
   Flex
   Energy storage
   We’ve launched a free plan. Go to modo.energy to see what all the fuss is about.
   Designed for owners and operators of
   energy storage in GB
   

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4. Alex Done
   Head of Research
   alex@modo.energy
   2019
   B’ham + London 11 teammates
   600+ users
   We’ve launched a free plan. Go to modo.energy to see what all the fuss is about.
   

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5. ~40% of batteries in GB are owned/operated by
   subscribers to our paid service.
   We’ve launched a free plan. Go to modo.energy to see what all the fuss is about.
   

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6. 1
   What’s changed -
   EBGL?
   

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7. We’ve launched a free plan. Go to modo.energy to see what all the fuss is about.
   Energy Balancing Guideline (EBGL)
   • EU regulation (2017)
   • Implement by 2023
   • Rules to harmonize balancing markets
   

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8. We’ve launched a free plan. Go to modo.energy to see what all the fuss is about.
   2 specific rules have taken centre stage
   for TSO services...
   Article 6(4)
   All balancing products shall be procured
   using pay-as-clear pricing.
   Why?
   Encourage participants to bid at their
   marginal cost.
   Article 6(9)
   All balancing capacity shall be produced
   less than 1 day before delivery.
   Why?
   Avoid paying for services we don’t need.
   

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9. 2
   What have we learned
   from TSO services?
   

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10. High service costs in DA STOR
    Provider behaviour has
    been difficult to predict
    To reduce spend, the ESO
    won’t ‘overbuy’ STOR
    Highly volatile market
    (and high service cost!)
    £72k/day
    £28k/day
    0
    10
    20
    30
    40
    50
    60
    70
    80
    Current Market Efficient market (modelled by Modo)
    Avg. daily spend (£k)
    Average daily STOR spend
    

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11. Penny bids in weekly FFR
    Wild price swings
    Dynamic, symmetric
    service clearing below
    asymmetric static service
    (!?)
    0
    2
    4
    6
    8
    10
    12
    14
    Clearing price (£/MW/h)
    Weekly FFR prices (Aug 2020)
    DLH LFS
    

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12. High prices in Dynamic Containment
    Consistently
    undersupplied market
    Price cap set by ESO
    Great news for BESS…
    0
    2
    4
    6
    8
    10
    12
    14
    16
    18
    0
    200
    400
    600
    800
    1000
    1200
    1400
    Oct 2020 Jan 2021 Apr 2021 Jul 2021
    Market price (£/MW/h)
    Volume (MW)
    DC market summary
    Volume Accepted Requirement Availability Fee
    

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13. We’ve launched a free plan. Go to modo.energy to see what all the fuss is about.
    Key takeaways
    • Be wary of complex auctions.
    • Auction design – impacts price
    • Designing new services is hard - getting this right first time is unrealistic.
    

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14. 3
    The end of long
    term contracts
    

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15. We’ve launched a free plan. Go to modo.energy to see what all the fuss is about.
    Long
    term
    Short
    term
    The move to real-time procurement
    Max contract
    length
    One-off
    Real-
    time
    Auction
    frequency
    2017 2018 2019 2019 2020 2021 Future?
    EFR FFR FFR
    FFR
    phase 2
    DC
    DC, DR,
    DM
    DC, DR,
    DM
    4y 2y 1m 1w 1d 4h 30m
    One off Monthly Monthly Weekly Daily Daily Daily
    Simple Complex
    Operational
    complexity
    

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16. Floor prices are becoming more commonplace (and
    attractive) to provide owners with long-term revenue
    stability
    -£1,000
    £1,000
    £3,000
    £5,000
    £7,000
    £9,000
    Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
    Monthly revenues (£/MW)
    Indicative monthly floor prices
    Revenues (net optimiser cut) Top-up Upside payment Floor price
    

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17. We’ve launched a free plan. Go to modo.energy to see what all the fuss is about.
    Key takeaways
    • Long term contracts are gone for good
    • The role of the optimiser is more important than ever.
    • In the new world of short-term, real-time markets, floor prices offer a solution.
    

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18. Alex Done
    Head of Research
    alex@modo.energy
    Preparing for short-term, dynamic flex markets
    Learnings from grid-scale flex
    

    View Slide