Non-BM imbalance & SoC calculation
For non-Balancing Mechanism-registered assets (non-BMUs), we have improved the way in which the ‘state-of-charge (SoC) management’ column in the leaderboard is estimated.
We also now include imbalance figures, particularly relevant for non-BM assets: see our Phase article on ABSVD to find out why!
Previously, we have used historic grid frequency values to estimate the energy imported or exported in providing frequency response services. With more assets participating in the higher utilization frequency services (like Dynamic Regulation), we have now improved on this to use actual frequency data. Thus, we can more accurately estimate the cost (or benefit) of providing ancillary services.
For non-BM units, we settle the energy used to respond to grid frequency at the imbalance or system price. Generally, for high-frequency services, this results in a charge (as energy is imported) and for low-frequency services, it results in revenue (as energy is exported).
For BM-registered units, we do not account for the cost (or revenue) from the energy imported or exported in providing frequency response. We assume it is netted off via ABSVD payments, in which National Grid ESO settles the energy imbalance costs that result from providing frequency response.
Changes to our assumption on round trip efficiency for calculating state of charge management for non-bm, previously assumed symmetric bi-directionally efficiencies of 92%, this has now changed to 85% on import and 99% export.
How this impacts the ‘state of charge management’ costs column for non-BM units
When providing high-frequency response, assets charge up and pay the system price for the energy used to do so (when grid frequency is above 50Hz). Any charging is assumed to be 85% efficient: if the battery imports 1MWh, its SoC increases by 0.85MWh. When providing low-frequency response, assets discharge and get paid the system price. Any discharging is assumed to be 99% efficient: if the battery exports 1MWh, the SoC has decreased by 1.01MWh.
To manage SoC, we assume they discharge (or charge) a similar amount of energy that they absorb due to grid frequency (and the service they are providing) within the same settlement period. We assume the energy used to manage SoC is paid at the system price, and apply the charge or discharge efficiency accordingly.
For example, a non-BM registered battery providing high-frequency services:
A battery charges 1MWh in providing 10MW of DRH in one settlement period.
The system price is £100/MWh, so it pays £100 for the charge energy.
Taking charge efficiency into account, the asset has charged up by 1MWh*0.85 = 0.85MWh.
To maintain a steady SoC, we assume it discharges by 0.85MWh within the same settlement period.
It discharges by 0.85MWh which releases 0.85MWh*0.99 = 0.84MWh onto the grid, taking the discharge efficiency into account. The system earns 0.84MWh*£100/MWh = £84 for this action.
We account for these actions in the imbalance and SoC management columns on the leaderboard in the following way:
Responding to grid frequency: -1MWh * £100/MWh = -£100 is in the imbalance column.
Managing the SoC: 0.84MWh*£100/MWh = +£84 is in the SoC management column.
So net, the cost of imbalance and the cost SoC management (if we add the ‘imbalance’ and ‘SoC management’ columns together is -£16.
We would normalize this for the power of the asset, so if it is a 10MW asset the net for imbalance and SoC management would be -£1.60/MW.
For example, a battery providing low-frequency services:
A battery discharges 1MWh in providing 10MW of DRL in one settlement period.
The system price is £100/MWh, so it gets paid +£100 for the discharge energy.
The SoC of the system changes by 1MWh/0.99 = 1.01MWh.
To maintain a steady SoC, we assume it must charge up 1.01MWh.
It charges up by 1.01MWh which takes -1.01MW/0.85 = -1.18MWh of energy from the grid.
The battery pays -£118 for this action, which is netted off with the initial discharge action, resulting in a net cost of managing the SoC of -£18.
So on within the leaderboard:
Responding to grid frequency: 1MWh * £100/MWh = +£100 is in the imbalance column.
Managing the SoC: -1.18MWh*£100/MWh = -£118 is in the SoC management column.
So net, the cost of imbalance and the cost SoC management (if we add the ‘imbalance’ and ‘SoC management’ columns together is -£18.
We would normalize this for the power of the asset, so if it is a 10MW asset the net would be -£1.80/MW.