Could Cornwall's local energy market provide solutions to renewable energy gaps?

It was 2017 when Centrica announced the start of a trail they called ‘Cornwall’s Local Energy Market’ , or LEM for short. The £19m project, funded by Centrica and the European Regional Development Fund , aims to create a more flexible, robust grid thorough the development of a local energy marketplace.

Combining the forces of many elements of energy supply technology, from efficiency monitoring to battery storage, time of use tariffs to combined heat and power, it was an ambitious project from the outset. Programme Director, Matt Hastings, said at the launch:

“Our aim is to help businesses and other large energy users from across the county to save money on their bills, and potentially even make some money, by optimising both their energy demand and on-site generation, and making their assets available to the National Grid.”

Two years into the project and the impact is starting to be seen. As of May 1st, 2019, installations of 100battery storage units have been made at domestic properties, as well as 46 additional solar PV arrays. 60 businesses have also received either battery storage capacity or demand side response technology such as combined heat and power(CHP) plants.

Cornwall is in something of a unique position, being one of the earliest and biggest adopters of large scale renewables. Anyone who has travelled through the county will be familiar with the Delabole wind turbines, which have been turning for over 25 years.

However, there is something of a problem. Cornwall’s energy grid is constrained. As long ago as2013, Western Power Distribution (WPD), the region’s power firm, said that renewable energy projects in Cornwall were putting the electricity grid ‘under severe strain’.

Upgrading the grid was certainly an option, but WPD estimated that costs could be between £1m - £4m for new large scale installations, depending on the size of the project. They also said they would ask developers to pick up ‘a large proportion of these costs’. Clearly such costs would be a massive barrier to renewable energy schemes, and the idea was vehemently opposed by renewables advisory company, Regen SW.

As a result, many of Cornwall’s numerous renewable sites are actually switched off due to lack of demand locally. In order to allow more capacity to be added in the future, either someone had to put their hand in their pocket, or a new idea needed to be found.

This is what the LEM aims to test, trailing how combining time of use tariffs for homes and businesses with some of the latest technology out there can plug the gaps in demand and supply, and see more of the energy being usefully utilised by local communities.

The Local Energy Market uses battery storage and demand side response to accommodate the imbalance between supply and demand. At times of peak energy production, if demand is too low, owners of battery storage facilities will be rewarded for storing some of the excess energy. Users will also be rewarded for using more energy at this time via smart time of use tariffs (SToU).

Conversely, if demand rises and production is too low, the stored energy can be sent back to the grid for consumers to use. Simultaneously users will be encouraged to save energy, again using a SToU function. Finally, if the demand is still higher than supply can cope with, demand side response such as local CHP plants can be switched on.

In order to deliver the project, Centrica had to develop a bespoke platform to allow energy to be flexibly bought and sold. The platform allows both WPD and National Grid to bid for flexible power, and for sellers to respond with what’s available. It is hoped that development and installations will be completed in time for the summer, with full trails expected to start in July.

Should the project be a success, it could be a highly valuable and interesting concept to see rolled out on a wider scale. Research by the Carbon Trust has shown that deploying flexible technology in the energy market could save the UK as much as £40bn by 2050, and make renewable energy a more attractive investment for developers.

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