ElectraLink, the UK energy market data hub, has compared total embedded generation in the UK between Q1 2016 and Q1 2017 and identified a 6% increase year on year. Embedded electricity generation is connected to the local distribution networks and is therefore invisible to the System Operator, National Grid.
Analysis of electricity market settlement data enabled ElectraLink to identify that much of this growth in embedded generation came from renewable energy sources such as wind and solar generators. In March 2017, the generation of embedded wind and solar was 33% higher than in March 2016.
National Grid expects that by 2030 50% of all electricity generation will be connected at the local distribution level. However, with the growth of the wind and solar components of embedded generation comes margin and price volatility. Renewable generation is dependent on weather conditions and therefore can be intermittent, fluctuating and variable. Changes in the weather can herald sudden reductions or increases in generation, unbalancing supply and demand margins and requiring National Grid to call on, or off, power plants – sometimes at short notice and at high prices. For example, in May 2017, a shortfall in generation, driven by unplanned outages and poor weather across the country, heralded an imbalance price spike to £1,510/MWh.
Dan Hopkinson, Head of Network and Energy Market Insights, commented: “A national picture of the generation market consisting of both generation connected to National Grid, and the ‘missing picture’ of distribution connected generation together provides market participants with a complete view of what is really going on.
“Lack of visibility of embedded generation compounds intermittency issues particularly with the growth of renewables. Balancing supply and demand requires National Grid to accurately forecast embedded renewables and given the rapid development of this type of generation, near real-time embedded generation data detailing what is being generated and where is very valuable to the marketplace.”
ElectraLink’s dataset provides visibility of over 95% of the UK’s embedded generation and is derived from settlement data flowing across ElectraLink’s Data Transfer Service (DTS)*. ElectraLink believes that this embedded generation dataset bridges a growing gap in the ability of the market to forecast accurately, balance supply/demand and minimise consumer costs during the transformation of the country’s energy system.