In December 2019, National Grid launched its’ Wider Access initiative, allowing a wider range of participants to access the Balancing Mechanism (BM).
This initiative also paves the way for Project TERRE which is a pan-European program to develop a trading platform for balancing services (the Replacement Reserve or RR market).
The main components of Wider Access are:
Whilst the VLP route to the market opens up access to the Balancing Mechanism for smaller participants and aggregators, it does not provide access to day-ahead and intra-day trading (EPEX Spot) and for smaller distribution connected assets, access must still be achieved by either acquiring a supplier license or partnering with an existing supplier.
VLPs will be requested to complete CVA Qualification Testing as part of the market entry process. This is to ensure VLPs can receive the two relevant VLP flows – CRA-I014 (Operations Registration Report) and SAA-I014 (Settlement Report).
VLPs, like other BSC Parties will be required to lodge credit cover for trading charges. VLPs are expected to lodge less cover as due to their role trading charges will be less.
The Performance Assurance Framework (PAF) provides assurance to the wider market that BSC provisions are being followed. VLPs are required undertake SVA Qualification.
SVA Qualification is required to prove that the necessary systems and processes are in place to fulfil a VLPs obligations and to mitigate the risks of failure.
The Supplier Volume Allocation Agent (SVAA) needs to be notified of the Metering System configuration at the SBMU site (MSID Pairs). Suppliers and/or VLPs must notify the SVAA which MSID Pairs should be treated as belonging to a SBMU for the purposes of providing TERRE or BM balancing services. This will allow the SAA to aggregate Metered Volumes accordingly to determine whether a Balancing Service has been delivered as the meters are not derogated to the VLP in their entirety and other services will continue to be provided by the Supplier.
An MSID Pair must include an Import MSID and may include an Export MSID. This is because the SVAA needs to know where the Balancing Service deviation will be realised for sites with both an Import and Export MSID.
VLPs must provide Half Hourly Delivered Volume data (P0282) to the SVAA for SBMU MSID Pairs. The SVAA will use this data and the Metered Volume data received from the Half Hourly Data Aggregator to allocate the delivered volumes to individual MSIDs in SBMUs. A Delivered Volume Exception Report (P0285) is returned to the VLP by the SVAA should the MSID Delivered Volume be inconsistent with the Settlement metered data (indicating incorrect reporting by the VLP).
This data is then provided to the SAA for inclusion in the Settlement Report.
Communication with the Balancing Mechanism should not be underestimated. Although the fixed line demands of EDT and EDL can be avoided, the business logic and functionality required to validate and compile submissions and receive instructions is by no means trivial and a participant with growth aspirations will soon exceed the thresholds and require traditional EDT and EDL communications MPLS lines.
Genstar4 is compatible with both Wider Access APIs and fixed line EDT and EDL standards and can provide a future proof solution for access to the BM and TERRE. Genstar4 is also offered as a hosted platform with fully redundant EDT and EDL communications and API services.
Dunstan Thomas Energy can also support participants wishing to acquire a supplier license through its’ partner network.
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