New utility Social Energy says it is the first to win permission from National Grid ESO to aggregate domestic response, so it can be traded in the Balancing Market.
The company plans to offer batteries to domestic customers and will use proprietary Artificial Intelligence to manage the battery charge in accord with customers’ predicted usage patterns, allowing it to give the customers access to flexibility revenues. Initially it will offer dynamic frequency response, but other revenue lines include the Balancing Market (BM) and demand shifting (especially into negative pricing periods). Network constraints payments are “on the radar,” said chief executive Ryan Gill, who said, “There will always be value in demand side flex. Where it is accessed will change over time.”
To gain full benefits from their installations, consumers will have to elect for half-hourly settlement. But Gill thinks they will save up to 70% on electricity bills, and pay back the battery cost in 7-10 years.
To bid the minimum 1MW into the BM, Social Energy has to have access to around 400 household batteries and by Q3 2019 it plans to be signing up 4,000 customers per month. At present, however, the bottleneck for customers who have signed up for the company’s controlled market entry (beginning February next year) is battery supply.
Gill has spent recent years working with PV installers and he hopes battery installers (90 so far) will act as brand ambassadors.
Gill was unconcerned by the loss of several other energy suppliers as the launch took place. The company’s business model means “volatility doesn’t scare us,” he said. He also expects to benefit from the loss of feed-in tariffs for new PV installations, as new PV owners will be looking for other sources of revenue.