Energy prices & policy

National Grid’s Optional Downward Flexibility Management (ODFM) service came to an end this weekend, on Sunday 25 October. But will this be the last we see of it?

The balancing initiative – which paid generators to reduce output or large consumers to increase consumption to avoid the system being overwhelmed when supply exceeded demand – was introduced as a temporary solution in May 2020.

A Covid-19 initiative

It was designed to help manage the unprecedented conditions of very low national demand caused by the Covid-19 pandemic, particularly when output from the country’s wind and solar generators was high. 

Delivery of ODFM required mostly renewable generators to reduce output or switch off for extended periods of time, with ‘Day Ahead’ notice given by National Grid. But some large consumers were also asked to ramp up consumption during periods of high supply.

This meant that National Grid was able to avoid instigating any emergency interruption of generation, which was only to be considered as an option of last resort.

Attracting new participants

A total of 4.7GW signed up for the ODFM service, including many participants new to balancing services such as solar farms.

In reality, the outturn of events was lower than National Grid forecast when it first launched the product.*

However, it has identified a definite enduring need for ‘negative reserve’ or a ‘footroom service’ in future summers, when the need for downward flexibility is at its greatest due to high wind and solar output.

While it is evident that the service was not without its flaws and required significant manual handling of despatch events and data, we expect that these issues will be addressed in future product design as part of National Grid’s Reserve reform activities.

Our team at npower Business Solutions will be monitoring developments to ensure our clients are well placed to participate when the revised service is relaunched in Spring 2021.

If you are interested in opportunities to earn revenue by participating in ODFM or other balancing services, contact your Client Lead (existing customers). Or email us via nBS@npower.com.

* At launch, National Grid predicted that ODFM would be utilised three times per week for ~3-4hrs at a time. The actual usage turned out to be less frequent – but the service was enacted for longer duration events, as follows:

Sunday 10 May: 238 MW of ODFM instructed from 0400-0700 (made up of wind and demand turn-up)

• Friday 22 May: 1900 MW of ODFM instructed between 2300 and 1630 on Saturday 23 May (made up of wind, solar and demand turn-up)

• Sunday 24 May: 1000 MW of ODFM was instructed between 0000-0900 (made up of wind and demand turn-up)

• Monday 25 May: 1000 MW of ODFM was instructed between 1000-1630 (made up of wind, solar and demand turn-up)

• Sunday 5 July: between 0000-2000 National Grid despatched 1288 MW at 0500, 2045 MW at 1000 and 2194 MW at 1200 (made up of wind, solar, load banks, energy from waste, biomass, CHP and demand turn-up)

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