Pricing
27 Jul 2022
Neil Weaver

Here are some Phase articles you may have missed

We recently counted down our top ten most popular Phase articles ever - on everything from locational marginal pricing to Dynamic Containment bidding strategies. But that top ten couldn’t cover everything, so here are some of our favourite articles that didn’t make the cut. We had loads of fun putting these pieces together - and we think you’ll find them super valuable (even if some of them are a little out of date by now)!

Triads 2021/22: what were battery energy storage assets doing?

In this piece, Imrith explored whether battery energy storage assets were able to successfully predict the 2021/22 Triad periods - and how they operated as result.

Triads 2021/22: what were battery energy storage assets doing?

What we said:

Figure 3 - GB BESS fleet operation, 02 Dec 2021.
  • Peak BESS export missed the first Triad by a single settlement period. The majority of BESS optimisers assumed that the Triad would fall in settlement period 35 or 36 (as has historically been typical), and exported accordingly.
  • However, the Triad actually ended up being settlement period 34 (16:30-17:00). BESS assets exported at just 19.45 MW (cumulatively) during the Triad. This was provided by four assets (Contego, Creyke Beck, Pelham, and Roundponds), 12% of their cumulative rated capacity.
  • Contego had both the highest Triad normalised export capacity and the highest revenues over the Triads period. Receivable TNUoS accounted for 6% of its total revenues.
  • Receivable TNUoS made up the highest proportion of Hill Farm’s revenues than any other asset - 9.64%.
  • Across this period, receivable TNUoS was more lucrative for BESS assets than Balancing Mechanism participation.
  • In total assets earned £23,345/MW from receivable TNUoS, representing 2.77% of total revenues between all seventeen assets during this period.
Imrith and Neil discuss how batteries were operating during the 2021/22 Triad season.

Click here to read the article in full.

Dynamic Containment: what’s driving the price volatility?

In this piece, Robyn looked into everything that shapes prices in Dynamic Containment - from the cost of alternative actions, to inertia on the system, to interconnector usage.

Dynamic Containment: what’s driving the price volatility?

What we said:

Dynamic Containment revenues have been incredibly volatile since the ESO adapted its auction design to include changing price caps and elastic demand curves.

  • The main force driving these price caps is the alternative cost of actions.
  • This is largely based on the assumed cost of the ‘other’ frequency response service: MFR.
  • MFR costs are dictated by factors such as system conditions, day-ahead power prices, and the capability fees of those units providing MFR.
  • The exchange rate for ‘converting’ MFR costs to DC price caps have recently been published by the ESO.

As for elastic demand curves:

  • Elastic demand curves can be explained by considering the largest losses of generation and/or demand on the system.
  • These are driven by inertia, and the percentage of demand being met by renewable generation.
  • For these reasons, we will continue to see large volumes of DCL and DCH being procured as we move through the summer months, in-line with seasonal conditions.
  • DCH volumes will be higher than they may have been, due to GB interconnectors currently exporting power to the continent more often than not.
When system inertia is low, DCL volumes are higher. (Data from 01/11/2021 - 19/6/2022.)

Click here to read the article in full.

The investment landscape for UK & Ireland battery energy storage

In this piece, Alex examined the performance and portfolios of three battery energy storage public funds in the UK and Ireland.

The investment landscape for UK & Ireland battery energy storage

What we said:

  • The average return of the three funds - Gresham House Energy Storage Fund, Gore Street Energy Storage Fund, and Harmony Energy Income Trust - outperformed the FTSE All-Share between July 2018 and Jan 2022, with a return of 19.5%.
  • BESS funds’ share prices were impacted less than the FTSE All-Share following the announcement of the first COVID-19 lockdown, with UK & Ireland fund value falling just 12% over Q1 2020, compared to 29% in FTSE All-Share.
  • The total portfolio size of the funds is expected to reach 2196 MW by 2024, ~3.5x today’s figure.
  • Geographically, the majority of projects are located in GB, with Gore Street ESF the only fund to deploy capital in Ireland to date.
UK & Ireland BESS funds and FTSE All-share normalised return from 01 July 2018-01 January 2022.

Click here to read the full article.

BESS in the BM: what we’ve learnt so far

Back in February, we looked at how battery energy storage was operating in the Balancing Mechanism.

BESS in the BM: what we’ve learnt so far

What we said:

Q talks about battery dispatch times in the Balancing Mechanism.

Competition in frequency response services is continuing to increase. New BESS assets are continually being energised and legacy markets (EFR and FFR) are being retired. In this article, we have looked at the ways in which BESS has been utilised in the BM, how assets have participated, and the potential revenue opportunities the market has to offer. Currently, BESS is being utilised for short periods of time (~12 minutes) and for low volumes (~4.83 MWh). With the BESS revenue stack likely to become more dependent on arbitrage strategies in the distant future, it’ll be interesting to take a look at how much more BESS the Balancing Market accommodates and how asset utilisation changes in the coming months.

Imrith discusses what battery energy storage assets are doing in the Balancing Mechanism.

Click here to read the full article.

How we Leaderboard: documentation release

The question we get asked most here at Modo: how do you build the Leaderboard? So, Imrith documented each step in that process - in short in this article, and in more detail in our help section.

How we Leaderboard: documentation release

What we said:

We believe that to transform our global energy systems, greater visibility is needed for people to see and understand more. That’s why we made the Leaderboard- to allow unparalleled visibility into the commercialisation of battery energy storage systems (BESS). The Leaderboard helps users to:

  • compare the relative performance of BESS assets across GB;
  • identify the most lucrative markets and strategies; and
  • understand how owners and operators are making most of the revenue agility that makes BESS so interesting.

Transparency is at the heart of everything we do at Modo. So, to help our users understand the Leaderboard in greater detail, we have published documentation detailing the underlying assumptions and methodology of how each section of the Leaderboard is calculated. You can read the documentation in full here.


Psst... we’d love your feedback! 🙏

You can now leave comments on Phase articles. So, if you've got a question you'd like answered, an opinion to share, or you just vehemently disagree with what we've written - you can let us know! We can’t wait to hear from you.