Household names EDF Energy and Shell are part of a newly established blockchain energy consortium, organised by Electron, a DLT energy trading platform backed by National Grid and Siemens.
Also in the consortium are: Baringa, Flexitricity, Kiwi Power, Northern Powergrid, Open Energi, Statkraft and UK Power Networks.
The group will co-develop a commercialisation model and the initial product set for the trading platform. This follows the announcement in September last year that Electron received BEIS funding to continue development work which is supported by National Grid and Siemens.
The system operator, government and industry experts have all highlighted flexibility as one of the key solutions to address the significant challenge of ensuring cheap, clean and reliable energy. They have set bold targets for a whole system review and for increased flexibility uptake (National Grid, System Needs and Product Strategy, 2017; BEIS & Ofgem, Smart Systems and Flexibility Plan, 2017).
Electron believes that a large, liquid and collaborative flexibility market is crucial for achieving these targets, and ensuring the ongoing decarbonisation, digitisation, democratisation and decentralisation of the energy market.
The objectives of the consortium are threefold:
● Incorporate the specialist knowledge and know-how of a diverse collection of stakeholders
● Develop the framework for a fit-for-purpose platform for the rapidly evolving electricity system
● Enable co-ordinated and collaborative trading of balancing and other grid quality products
Paul Ellis, CEO and co-founder at Electron, comments: "We are delighted to have established a forum for industry participants to work together to make transactive flexibility something that is real and relevant. By working together, we recognise the current system needs to be changed and we are designing a system for present and future market participants."
Nick Tallantyre, Partner at Baringa said "As our electricity system becomes increasingly decentralised, it is vital that we find more effective and more transparent mechanisms for market participants to offer and trade flexible assets. Blockchain represents an innovative, new framework on which such a flexibility market could be created and we are excited to work with the industry to design such a solution"
Chris Regan, Head of Business Development at EDF Energy said, "Our approach for customers is about extracting the maximum value for every kW of their flexibility. This lowers the overall cost of balancing the systems, thus reducing the overall costs to UK consumers. We are excited to be at the centre of this new paradigm, partnering new entrants and setting the direction of a decentralised flexibility market."
Flexitricity's Founder & Chief Strategy Officer, Alastair Martin, said "Flexitricity's job is to take energy users' flexibility to market, and monetise it for them. This project is an imaginative new market that could tie together several different value streams, and open up some new ones. We're excited to be involved."
Yoav Zingher, KiWi Power's CEO and Founder, said "Open and transparent markets are of vital importance to secure the most efficient, flexible future for electricity markets. KiWi Power has a strong track record over the past decade of delivering the best results for our clients in existing markets and will use this experience to guide the development of this new dynamic marketplace. As disruptive pioneers in the electricity industry we are excited to be part of a leading project to bring markets for flexibility forward into the 21st century."
Jim Cardwell, Northern Powergrid's Head of Trading and Innovation, said: "The development of the blockchain technology is seeking to provide the commercial infrastructure to support a wide variety of future market models for energy and network services. This collaboration complements our wider portfolio of activity outlining our transition to the new role of distribution system operator and investment in enabling grid technology that delivers value for our customers."
Sebastian Blake, Commercial Manager at Open Energi, said "The energy industry is in the midst of a paradigm shift that is revolutionising how electricity is supplied and managed while accelerating the UK's transition to a low carbon economy. Secure and transparent marketplaces for flexibility are fundamental to this transition, and will remove market barriers, empower consumers, and finally level the playing field between large power plants and smart, distributed on-site capacity."
Dale Geach, Technology and Innovation Manager at Siemens said, "Seeking to solve the inherent issues of collaborative trading between multiple customers will unlock real value for stakeholders in the energy system and facilitate a much needed and efficient route to market for Distributed Energy Resources offering Demand Side Response services. We are excited to be supporting this project and exploring the potential impacts and benefits of decentralised electricity flexibility markets."
Brian Lonn, Downstream Development Manager at Statkraft, said, "As Europe's largest generator and marketer of renewable energies Statkraft is a major buyer and seller of flexibility. To us the prospect of a new and efficient marketplace for flexibility has a natural appeal."
Sotiris Georgiopoulos, Head of Smart Grid Development at UK Power Networks said: "We see flexibility as key to delivering value for customers in the future energy system. Harnessing energy flexibility through technology will enable us to increase participation in the rapidly-evolving electricity market".