UK traders hit out at ‘crazy’ new physical wind data rules

Henry Evans

26-Jan-2015

Traders on the UK wholesale electricity market have expressed amazement that a new regulation obliging wind farm operators to notify the system operator of real-time electricity output will not be rolled out for existing wind farms.

Earlier this month, British energy regulator Ofgem approved a modified grid code to impose mandatory reporting of real-time physical notification updates on wind farms commissioned after April 2016 (see EDEM 12 January 2014).

An industry consultation published by National Grid Electricity Transmission recommended that 10-15 minute intervals would suit real-time reporting but also revealed that existing technology could facilitate refresh rates up to 5 second intervals.

The changes will mark a notable shift from current convention where all generators are only obliged to give a half-hour estimate of their output an hour in advance of production, known as gate closure.

But the decision to exclude existing wind assets from the code has been met with criticism by UK power traders, who believe the two-stream reporting of output will not only lead to higher balancing costs for National Grid but will add an extra layer of complexity for those trading intra-day positions.

One power trader from a commodities hedge fund described the decision as “crazy”.

Another trader from an energy supplier said a slowdown in the rate of wind farm commissioning over the next few years could limit the benefits of real-time reporting.

Concerns over the amount of subsidy available to new renewables means the amount of commissioning could decline towards the end of the decade.

Costs

The trader from the supplier added that reacting to physical notification data at different time intervals from wind turbines would lead to greater balancing actions and costs for system operator National Grid.

“You will end up using some of the generation from the fifteen minute interval data to balance off a reduction in the one hour turbines,” he said.

“What’s the point of having four wind turbines with [a] fifteen minute view and thirty-five at an hourly view when you can all get fifteen minute views and make one correction on the balancing system to correct an overall deficit or surplus in wind.”

Ofgem has refrained from imposing the regulation on existing wind farms over concern that the costs incurred to retrofit the measuring technology for real-time notification would be too prohibitive.

However National Grid said it will work with wind farms to encourage the uptake of the technology.

“We want to be fair to existing generators by balancing improvements to system operation with cost,” a spokeswoman said.

“We have, therefore, not made retrofitting mandatory but have ensured intermittent generators can take part by agreement if they wish to and we will work with them to achieve this for the greater good of the market,” she said.

National Grid has supported the code modification through a consultation process and believes that real-time reporting will enable wind farms to participate in balancing services, thereby enhancing system security. Henry Evans

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