Building an EV-ready energy market
There is no magic bullet for adopting an energy network for electric vehicles, says Mark Bygraves, chief executive, Elexon
The expected surge in uptake of electric vehicles on roads is a gamechanger for the energy network. Demand from EVs is expected to drive up peak demand by a staggering 6–18 GW (12–36 per cent) by 2050, according to National Grid.
Preparing and adapting the energy network for a change of this magnitude is no simple task, and a huge amount of work is being done by governments, regulators and the energy industry in this area.
For instance, significant thought is being given by industry to what charging infrastructure might look like, including proposals for superfast charging facilities along UK motorways.
As the body responsible for administering the Balancing and Settlement Code (BSC) – one of the most important industry codes underpinning the electricity wholesale and retail markets – Elexon is also playing a crucial role in addressing the EV challenges.
From leading the development of marketwide Half Hourly Settlement (HHS) and EV lamppost charging to conjuring evolutionary solutions for the market, Elexon is committed to supporting and facilitating the innovation needed for the network to be ‘EV ready’.
One of the greatest concerns with the uptake of EVs is the risk of ‘brownouts’, caused when multiple vehicles charging in close proximity to each other place significant strain on the grid. Elexon has been tasked with leading the design of the market-wide HHS, a crucial project that will enable dynamic Time of Use Tariffs (ToU). These will help move demand created by EVs away from peak times, minimising the strain on the electricity system.
It is vital to ensure that the needs of the consumer are placed at the heart of all preparations for the transition to EVs and that we seek opportunities to embrace new innovation in the short term as well as the long term.
Elexon has recently published proposals that could quickly unlock new business models that would enable innovation and customer choice. Our White Paper, Enabling customers to buy power from multiple providers, suggested consumers would stand to benefit from having multiple suppliers in a future energy system. Our current energy system typically requires each customer to have one supplier at a time – a model often referred to as a ‘supplier hub’.
In our White Paper on multiple providers, we showed there are tactical changes to the central market rules and arrangements that can enable us all to realize the benefits of a multiple supplier world much earlier.
Rather than a complex and time-consuming overhaul of the current system, we suggest simply introducing a customer notification agent (CNA) that will inform Elexon’s central settlement systems of any energy volumes bought by customers from someone other than their main supplier.
Elexon could then validate the submissions for consistency with data from customers’ meters, and use them to allocate energy volumes to each organisation supplying energy to a given customer. This approach enables us to realize the benefits for consumers and suppliers without a costly and time-consuming industry overhaul.
Elexon is currently gathering views on its proposal. If we get support – either from industry or other interested parties, including community suppliers and technology developers – we will then start the process of implementation through a series of phases to maximize the opportunity for full scrutiny and for all stakeholders to input.
As part of the UK’s Department for Transport’s (DfT’s) On-Street Residential Charge Point Scheme, the Office for Low Emission Vehicles (OLEV) is expecting large numbers of ‘slow’ charge points to be installed in unmetered lamp posts. This allows customers without access to off-street parking to charge their vehicles close to their home. In addition, the cost-effectiveness of lamp post charging solutions means that it is being taken up by many local authorities, particularly in London.
Elexon has been involved in developing settlement requirements for these products and has been in contact with key stakeholders.