Post: GridBeyond secures 271MW prequalified capacity

GridBeyond secures 271MW prequalified capacity

The Capacity Market Registers published on 29 November have confirmed that GridBeyond has 271 MW for the T-1 and 415 MW T-4 auctions planned for February 2023.

Very exciting news for us at GridBeyond with the Pre-qualified capacity including New Build Storage, Demand Side response and Gas capacity. The T-1 auction saw 7GW (67% from existing generation and 19% from new build) of de-rated capacity prequalify, compared to the target capacity of 5.8GW this means the auction was 20% oversubscribed. Although the target volume is still subject to change during the National Grid annual review ahead of the auction. 

This compares to last year’s T-1 where all prequalifying volume were needed to meet the target, resulting in the maximum auction price of £75/kW/year. The T-4 auction was also oversubscribed with ~50GW prequalifying against the target of 42.4GW,

What is the Capacity Market?

The Capacity Market is designed to make sure we have enough reliable capacity to meet peak electricity demands (typically winter evenings) and at the lowest cost to consumers. It does this by procuring what is necessary using a competitive auction process.

There are two capacity auctions each year:

• T-4 – this is the main auction; it buys most of the capacity needed for delivery in four years’ time.
• T-1 – these are top-up auctions just ahead of each delivery year.

Can I take part?

Capacity Market participation is open to a wide range of assets — new and existing generators, including on-site generators such as combined heat and power engines and heat pumps, flexible load (industrial processes, HVAC, refrigeration, etc.), and energy storage. Both fast responding asset types and those with longer ramp times can participate. But assets that can only run for a limited amount of time (such as batteries) receive de-rated payments to account for this.

Participants are paid to ensure they’re available to respond when there is a high risk that a System Stress Event could occur. To earn revenue for our customers, we take their assets into capacity auctions where the price is set.

Providers who are successful in the auction(s) are awarded a Capacity Agreement, which confirms their obligation under the programme and the payments they will receive. Capacity market revenues can be layered on top of those from balancing services and is controlled via the very same platform.

Since 2020, through our Capacity Clearing House, GridBeyond has successfully operated secondary trading to help a large number of customers and generators to clear obligation commitments they either weren’t able meet or receive an obligation if they were unable to gain one, thereby avoiding costs and/or gaining unplanned revenues.