Update on Review of Embedded Generation Benefits
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Update on Review of Embedded Generation Benefits
Andy Wainwright
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Background
Standard Licence Condition C13
Introduced at BETTA (2005)
Addressed different treatment of 132kV connected small generation in Scotland (transmission) with that in England and Wales (embedded)
Time limited: due to expire 1st April 2016
Embedded review needs to consider overall implications on GB generation
Informal industry focus group established Spring 2013
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Objectives of transmission charges
Cost reflectivity
Facilitate competition
Developments in transmission businesses
Recover transmission costs
Non-discrimination
Affected transmission ‘charges’
TNUoS BSUoS Losses
Focus Group agreement to consider TNUoS first
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TNUoS Charges - Locational Element
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A B C D E
Gen
Dmd
TNUoS Locational Elements only
Charging Zones
Ta
riffs
Net approach
Embedded generation nets with demand
Therefore subject to a negative demand locational signal
Based on output at Triad
Equivalent to generation signal: zoning limitations
Gross approach
Embedded generation receives same generation signal as transmission connected
All demand receives locational signal
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The effect of the generation residual element
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A B C D E
Gen
Dmd
Avoidance of generation
residual charge
Embedded generator avoids paying generation residual element
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The effect of the demand residual element
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A B C D E
Gen
DmdNetting of positive demand
Positive demand can avoid paying the demand residual element if able to net with embedded generation
Embedded generation therefore has a value equal to the demand residual element
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Combination of both residual elements In summary, embedded generation can receive TNUoS ‘benefit’
through two effects on residual elements;
netting of positive demand (i.e. reducing demand charge)
avoidance of generation residual charge
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A B C D E
Gen
Dmd
Avoidance of generation
residual charge
Netting of positive demand 2 x Residual
uplift
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Year Cost Residual
2012/13 £1.41/kW £27.07/kW
2009/10 £1.30/kW
(equates to £1.47/kW in 2012/13)1
£20.74/kW
(equates to £23.53/kW in 2012/13) 1
1 RPI factor for 2009/10 to 2012/13 = 1.132992
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£/kW
Project
Annuitised demand related infrastructure costs
Average
How much benefit should be paid for offsetting +ve demand?
NGET GSP infrastructure reinforcement costs
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Average TNUoS charge: £7.57/kW (2013/14)
Transmission Function (Use) Transmission connected G
Embedded G
Net transfers inject NetAccess to Market (s) GB & wider EU
Security / Quality of Supply
Should embedded generation pay for transmission?
How does embedded generation use transmission?
Comparing transmission and distribution charges
Note 2013/14 average TNUoS charge: £7.75/kW
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Other areas under consideration
Impact on >100MW generators
Exporting GSPs
Offshore Transmission Implications
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Next steps
National Grid report to be published October
Include Focus group & bi-lateral discussions
Three week open letter
Formal CUSC modification proposal potentially later in Autumn