Pricing
07 Mar 2024
Wendel Hortop

Balancing Mechanism: Battery dispatch rates increase in February 2024

Dispatches of battery energy storage through the Balancing Mechanism increased to a record-high in February 2024. This helped to boost revenues, with the GB BESS index increasing 3% from January.

The rise in dispatches followed an increase to the in-merit dispatch rate of batteries to 6.5%, from 4.6% in January. This marks the second-straight monthly increase to dispatch rates of batteries following the launch of bulk dispatch for battery energy storage at the beginning of January.

What do we mean by in-merit dispatch rate? This is measured as the volume of energy dispatched to batteries in the Balancing Mechanism as a proportion of the total that was available and cheaper than the most expensive action taken.

Dispatch volumes increase by 33% following improvement in the use of bulk dispatch

The ESO held a webinar on February 12 on the progress with improving utilization of battery energy storage in the Balancing Mechanism. This included an update on the use of bulk dispatch for batteries, alongside the introduction of the 30-minute rule on March 11.

Within this webinar it was announced that an additional control room engineer had been made available from February 5 to assist in dispatching batteries via the bulk dispatch tool. This was for an initial three week period.

From this date to the end of February, daily dispatch volume for batteries increased by 33% compared to the period following the re-launch of bulk dispatch in January. The most significant impact was seen on the Bid side, with volumes increasing by 46% on average. System-flagged Bid volume increased by 25%.

Data from the ESO suggests that at the end of February, 53% of all battery dispatch volume was being instructed via the use of bulk dispatch.

Increased use of bulk dispatch doubled the number of instructions for batteries in February

The increase in dispatch volume followed a significant increase in the number of dispatch instructions being sent to battery energy storage.

Following the addition of an extra control room engineer to assist in the use of bulk dispatch, an average of 1,259 instructions were sent per day to batteries - up from 591 in the period following the launch of bulk dispatch.

March brings further changes in the Balancing Mechanism for batteries

On March 11th the 15-minute rule for batteries will switch to the 30-minute rule. This means that MEL and MIL declarations for batteries will change to be based on 30 minutes of energy capability rather than 15. This change is being made to allow batteries to be used for a wider range of dispatches in the Balancing Mechanism. This will include energy balancing dispatches via Balancing Reserve.

Balancing Reserve launches on March 12th, with delivery starting the next day. This aims to solve the problem of ‘strategic skips’. These are caused by having to turn on large fossil-fuel plants to provide upwards reserve. This market could provide a route to additional dispatch for batteries, if the control room can improve their utilization of the technology.