June 29, 2023 9:00 AM

Turning up low-carbon heat pumps and EVs in Scotland keep wind turbines spinning

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  • Piclo has facilitated the successful procurement of residential and industrial demand response from Orange Power and CUB UK Ltd as part of the ESO’s new Local Constraint Market, using the Piclo Flex platform.
  • Rather than curtailing wind energy, which costs consumers money and hinders our net zero progress, households in Scotland were paid to turn-up their low carbon flex assets including heat pumps, EVs and electric heating.
  • This is a world-first for any national electricity network control room to use a Cloud based SaaS platform to procure and dispatch flexibility services. 

LONDON, 29 June 2023 – Piclo, the leading independent marketplace for flexibility services,  has successfully completed the first end-to-end transactions of flexibility services for the ESO’s Local Constraint Market (LCM), with Flexibility Service Providers Orange Power and CUB UK Ltd.  Since the end of May, across 10 different days, a total of 3MWh of flexibility was contracted and dispatched.

This is a step forward in managing grid flexibility, as, rather than curtailing low carbon wind, households in Scotland were incentivised to ‘turn-up’ their low carbon assets such as charging their EVs and increasing their use of electric heating or cooling in their homes and industrial sites during specified times. 

This also marks a world-first for a national electricity network control room to use a Cloud based Saas platform to procure and dispatch flexibility services.

Between 2021 and 2023, £1.5 billion was used to curtail over 6.5TWh of wind power, resulting in 2.5 million tonnes of emissions. Reducing the amount of renewable electricity which is curtailed is a key opportunity as the energy system transitions to low carbon.

This initiative will help to manage peak wind energy flows and participate in creating a local marketplace that diverts extra wind power into local assets at times when southward flows are at capacity – benefiting everyone from those who are charging EVs, businesses with battery storage and even iconic Scottish pumped hydro stations that have pioneered renewables in the region for decades.

James Johnston, CEO at Piclo said: 

This is a momentous milestone for Piclo and the ESO. It is the first time the ESO’s control room has used a cloud based platform as part of their trading operations . This marks a turning point in the energy transition, where the introduction of a digital marketplace not only democratises access to flexibility markets by reducing barriers for participation but also facilitates a more efficient and streamlined operation of the electricity network. We start today with 3MW and our ambition is to grow to 30GWh. This has been a massive boost to our mission to decarbonise the world's grids.

Companies are invited to register on Piclo Flex and upload any eligible distribution connected assets they have in Scotland to maintain the balance between energy supply and demand, ranging from aggregated residential assets to larger MW-scale assets.

Claire Dykta, Head of Markets at the ESO said: 

“Delivery of the Local Constraint Market is an important step for the ESO as we look to address rising costs and unlock wider flexibility service options from distributed assets. Delivering short-term solutions such as this help us on the path to deliver the goals of our Markets roadmap, to deliver long term management of constraint costs and to increase the value and availability of flexibility services. We look forward to working with Piclo to expand this Local Constraint Market further and grow the value it can deliver for consumers.”

Louis Fairfax, Managing Director at CUB UK Ltd said:

"CUB is delighted to take part in the LCM competitions, helping to bring operating costs down for critical transmission grid balancing and redirect money back to customers at a time of high energy prices. We are actively working with and seeking out industrial and commercial customers with whom we want to promote the benefits of this service. Piclo has played an essential role in getting this product to the operational trial stage. We are looking forward to working with the ESO and Piclo on developing the market-ready LCM model through learnings on the trials to date."

Piclo and the ESO are looking to scale up these initial trials, in discussion with the Distribution Networks Operators covering the Scottish regions, to deliver meaningful volumes to reduce costs for consumers.

Local Constraint Market competition details

From 22nd May 2023, competitions were uploaded to the Piclo Flex site to alleviate the B6 transmission constraint boundary:

  • System Operator: ESO
  • Flexibility Service Providers: Orange Power and CUB UK Ltd
  • Bids accepted: 94 
  • Total amount of capacity procured: 3.3MWh
  • Asset types: Residential and industrial demand response assets including heat pumps, EVs and electric heating.

Initial pricing and bid acceptance will continue to evolve as the LCM moves from operational trials to full commercial launch later in summer 2023.

What is the ESO’s Local Constraint Market (LCM)

The Local Constraint Market (LCM) has been put in place in Scotland by the ESO to allow Scottish homes, businesses and distribution connected generating assets to benefit by helping to manage transmission constraints.  It is a new marketplace that could divert surplus power into local assets at times when southward flows are at capacity – benefiting everyone from those who are charging EVs, businesses with battery storage and even iconic Scottish pumped hydro stations that have pioneered renewables in the region for decades.

The LCM is relevant for Flexibility Service Providers with assets located north of the B6 (transmission constraint) boundary throughout Scotland, including smaller assets that fall below the usual 1MW minimum requirement threshold for Balancing Market participation.

It will also help bring operating costs down for critical transmission grid balancing and redirect money back to customers at a time of high energy prices.

About the ESO

The ESO is a legally separate business within the National Grid group – sits at the heart of the electricity system in Great Britain, keeping the lights on around the clock for energy consumers. We move electricity around the country’s high-voltage network to balance supply and demand in real-time, using a mix of power sources to make sure electricity is available wherever and whenever it’s needed.

Interested parties are encouraged to register their interest on Piclo Flex and subscribe to the ESO's Future of Balancing Services newsletter for more information. Further information from the ESO is published here

About CUB UK Ltd

CUB is a family owned energy consultancy firm with nearly 30 years of experience in the energy market. CUB have helped businesses with their energy costs since 1994 and more recently used their knowledge to generate revenue for business energy users whilst in turn helping the local and national grid to stay balanced, through their Reduction Reward Scheme. CUB are passionate about helping businesses to benefit from their flexibility and take part in the "Smart Grid" through DSR schemes such as LCM.

Available for interviews:

James Johnston is the CEO and Co-founder of Piclo, the leading marketplace for flexibility services, with a growing presence across the UK, Europe and the USA. Born and raised in the Scottish Highlands, prior to Piclo, James spent 3 years researching microgrids at University of Strathclyde. James is also the founder of Solar Sketch, a design company for the solar industry and worked at international engineering firm Arup. James is a sought-after expert and published author contributing chapters to academic books on peer-to-peer energy and local flexibility trading.

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About Piclo

[This notice was update on 26th March, 2024]

Piclo’s mission is to decarbonise the grid. We develop software solutions that make our energy networks smarter, flexible and more sustainable. Piclo Max, our market access platform, enables flex sellers (such as EV and battery owners) to access all electricity markets from one place. Piclo Flex, our flexibility services marketplace, enables flex buyers (system operators) to source flexible electricity from flex sellers during times of high demand or low supply.

To date, Piclo has over 300,000 registered flexible assets representing 22 GW of registered flex capacity, with flexibility contracts awarded totalling £74m and 2.6 GW+ of flexible capacity procured.

Piclo currently operates in six global markets: in the UK, supporting all six Distribution System Operators (UK Power Networks, SP Energy Networks, Electricity North West, Northern Powergrid, Scottish and Southern Electricity Networks and National Grid Electricity Distribution); and the Transmission System Operator (TSO) (the ESO); in Ireland (ESB Networks), Italy (E-Distribuzione), Portugal (E-REDES)); in Australia (CitiPower, Powercor); and in the United States in New York State (National Grid) and Connecticut (United Illuminating). Aside from its leading position in the UK, Piclo has a growing presence in Europe, USA and the Asia-Pacific. 

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