19 Nov 2023
Zach Jennings

Triad season 2023/24: what’s changing for batteries?

November represents the start of Triad season for winter 2023/24. Triads present an opportunity for batteries to boost their revenues by exporting. With lower revenues available throughout this year, Triads promise to remain as important as ever.

So, as we head into winter, here’s everything you need to know about Triads in 2023.

What are Triads?

  • Triads determine how variable TNUoS is charged. These tariffs are set in advance and vary by region.
  • Triads are defined as the three settlement periods with the highest demand on the transmission system, between November and February (inclusive), which are at least ten days apart.
  • Demand pays an import tariff on their average electricity consumption across the three Triad periods. Those embedded in the distribution network receive a credit on any export during the Triads.

Triads represent a valuable opportunity this winter following falling revenues elsewhere

Batteries can earn revenue from the Embedded Export Tariff (EET) by exporting during Triads. The amount batteries can earn varies depending on location. The ESO published the final tariffs for winter 2023/24 in May. Batteries in the South West can earn the most by exporting during the Triads. These systems also face the highest risk from importing during these periods.

For example, a battery that exports at full power for all three Triads will earn £10,193/MW in the South West, compared to £2,052/MW in the East Midlands. Meanwhile, batteries in regions with no Embedded Export Tariff will earn nothing.

The Modo BESS Index for 2023 has averaged £46k/MW/yr. Therefore Triads represent a valuable opportunity to boost revenues - especially for batteries with the highest export tariffs.

How do batteries earn revenue during Triad season?

The amount a battery will earn from Triads is determined by calculating the average export power over the three Triad periods and multiplying this by the corresponding export tariff for that region. Taking last year’s Triads as an example, multiple batteries exported across two of the three Triad periods. A 100 MW battery would earn 100 x ⅔ x EET in this scenario.

To successfully capture Triad revenues, optimizers must look to export during the settlement period with the highest demand (usually between 4.30 and 6.30 pm), on days with sufficiently high demand. This makes forecasting vital to ensure the battery is in a position to be able to export during these windows.

Predicting Triads is getting harder

Last year’s Triad at 17:30 on December 2nd was the lowest-ever demand for a Triad and the first below 40GW. Only one battery successfully captured more than 50% of this Triad, showing how hard it is becoming for operators to predict these accurately.

The previous record for lowest Triad demand was 42 GW, which occurred in the 21/22 Triad season. This general trend of Triad demand falling is expected to continue this winter, making predicting them more challenging than ever. Based on the trend over the last five years, this winter could well see a Triad at a demand as low as 39 GW, or even 38 GW.

The record-low Triad from 2022/23 also fell on a Friday for just the second time ever. Triads have fallen on a Monday 34 times before, making it the most common day for a Triad to occur.

Triads will have little impact on batteries in the north of Great Britain

Following the Targeted Charging Review last year, 95% of the import tariff has been removed for 2023/24 and moved to a fixed tariff, which battery energy storage can avoid. This means batteries will only be liable for the regional TNUoS import tariff, which is now lower than the Embedded Export Tariff in every region of the country. This significantly reduces the risk from importing during Triads, which reached £60/kW in 2022/23.

This change means that batteries in the north will no longer need to worry about predicting Triads, as they cannot earn from the export tariff and will not pay charges for importing either. This means we may see very contrasting strategies between batteries in different regions this winter.