For a net zero energy system, with large volumes of variable renewables and more electric heating and transport, flexibility is essential. Without it, renewable energy would be wasted, electric vehicles and heat pumps would increase peak demand, and all consumers would pay the price of a more expensive energy system. Flexibility is hugely valuable: the challenge is how we unlock that value from assets connected to the distribution network – “distributed flexibility”.
Flexibility already exists in our energy system. However, we are not seeing the scale of distributed flexibility that we need due to market access and coordination issues. This is especially true for Consumer Energy Resources (CER) like electric vehicles and heat pumps. We need a flex-centric system which facilitates distributed flexibility, but it is not clear that this will emerge organically.
In this call for input, we propose that a common vision for distributed flexibility is needed for the industry to unite behind to reach flex-centric future. Specifically, we propose that vision is a common digital energy infrastructure. We present and seek feedback on 3 archetypes for what that could look like and compare these to a business-as-usual counterfactual.
We outline initial considerations on delivering a common digital energy infrastructure, covering institutional roles and financing approaches. We also discuss the need for additional enabling work to address market specific issues and wider energy system capabilities to unlock distributed flexibility. A supplementary technical annex is also published alongside this document.
Additionally, we have also published further background work contributing to the Call for Input, including a technical consultancy report on digital design options with associated appendices, and a technical report assessing candidate data standards for markets. These reports do not reflect an Ofgem policy position, they have been published to ensure background work is openly available. Please see the report cover notes for further clarifications.
This call for input is strategic in nature and sets out a long-term vision for distributed flexibility. We are seeking input from stakeholders so we can develop this vision with industry.
We request that stakeholders send us their responses by 17:00 on 10 May 2023 to email@example.com.