Issue 71

Formal title: Introduction of a baselining methodology as an alternative to Physical Notifications

Modification Proposal P344 ‘Project TERRE implementation into GB market arrangements’ seeks to align the Balancing and Settlement Code (BSC) with the European Balancing Project TERRE (Trans European Replacement Reserves Exchange) requirements. A final Ofgem decision is expected by 31 July 2018.

The P344 solution is intended to facilitate participation in the Balancing Mechanism (BM) and TERRE by a wider range of market participants, including customers and independent aggregators. It is envisaged that the existing BM Settlement arrangements will remain unchanged. Under the BM, National Grid can issue MW profile instructions to a BM Unit to deviate from a MW baseline.

Balancing Service providers that want to participate in the BM must indicate at what MW level they expect their BM Unit to be at for any given Settlement Period. This is known in the Grid Code as a Physical Notification (PN). At Gate Closure this MW level is finalised and sent to Settlement where it is termed the BM Unit’s Final Physical Notification (FPN) and acts as a baseline for any future deviation instructions from National Grid.

P344 Workgroup members have noted that the requirement to provide a Physical Notification (ahead of Gate Closure) may be problematic for customers and independent aggregators, where the asset they control (and whose output they can forecast accurately) may share a network connection with other Demand or Generation whose output is outside of their control. In this situation, the expertise for new market entrants lies in calculating the cumulative change for the customer’s sites but not the cumulative change relative to total Demand for those customer sites.

Issue 71 seeks to examine the possibility of PN for a site being created via an alternative baselining methodology.

A further Issue has been raised, Issue 70, which seeks to examine the possibility of Settlement of Secondary BM Units using metering at the asset. These baselining and asset metering issues are complementary, as Parties may opt to apply baselining at a site dependent on the metering set up and where Settlement takes place i.e. at the Boundary or at the asset.

Due to the complementary nature of these two Issues, the Issue Groups will be held on the same day for progression efficiency.

Progression

The Issue Report was presented to Panel on 11 Ocotber. Panel noted the Issue 71 Report.

The first Issue Group was held on 11 July 2018. 

The first Issue group was held on 11 July  2018. The Issue Group defined the issue and addressed specific areas of consideration, coming up with a range of initial proposals for a subsequent Modification, if raised, to address. 

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