Flextricity is one of the early movers in pulling together a BM offering, something that feels like a natural progression after the rather harsh reality checks of FFR Curtailment and Capacity Market De-rating dampened some investor enthusiasm for storage ownership and development. Neither piece of news was unexpected, but the timing of them both were. In particular, the CM de-rating timings (in between pre-qualification results and the need to submit credit cover) could perhaps politely be described as "disruptive".
But the reality is that the market was always likely to be flooded by the flocking to what were perceived to be fixed contract revenues. At the outset, batteries were always discussed in light of their flexibility, and adaptability to build a revenue stack, and EFR and, to a lesser extent, FFR and CM, played neatly into the FiT and RoC mentality. We therefore need to swing back to the stacking of revenues...balancing, load shifting, digital inertia and the generation of monetisable data to supplement grid services revenue.
With that broader principle in mind, there is perhaps an interesting opportunity in the Capacity Market brought about by supply disruption to the gas market, and a consequent surge in pricing. This may partially correct by the time the CM auctions come round, but I wonder if worries about gas pricing could play on the minds of the peakers and push the auction bids higher...if so, there's an opportunity for batteries to just look a little bit more attractive and secure a little extra value.
I'd be very interested to hear your thoughts on this, to email@example.com
Flexitricity is bidding to take end users into National Grid’s Balancing Mechanism by seeking a supply licence. And the Edinburgh-based demand response aggregator intends to give its customers a slice of the £350 million market in doing so. Flexitricity has not yet appeared on Ofgem’s list of licenced energy suppliers but has expressed its intent to do so. This, the company said, would allow its industrial, commercial and public-sector customers to access to flexible power market that makes up the Balancing Mechanism. The company noted that in comparison to the wholesale market’s unit cost of around £50/MWh, prices on the Balancing Mechanism can top £2,500/MWh in times of high demand, which it said could be hugely lucrative for owners of generators, battery storage or flexible demand.