Heather O’Brian Markets - 27/July/2020

Renewables as grid flexibility tool gives glimpse of the future

As economic activity declined under the pandemic so did demand for electricity. Fossil fuel generation was squeezed off the grid by renewable energy projects with lower marginal costs. Fears that the higher proportion of fluctuating supply would destabilise power systems proved unfounded and grids remained stable. If renewables are to be tasked with keeping the grid secure, alternative mechanisms, already available, must be introduced soon

Grids have coped well with fluctuating and unpredictable demand during the Covid-19 health crisis

BALANCING ACT The fall in electricity demand tripped by the Covid-19 pandemic highlighted how conventional generators will be pushed off the grid in the future, meaning they are no longer available to offer system flexibility. Other technologies are already stepping into the breach

RAPID RESPONSE In need of extra, low-cost flexible generation to cope with a rising proportion of variable supply in the electricity mix as demand dropped, the UK system operator rapidly advanced plans for small wind and solar generators to take part in a new flexibility market. As a stabilisation tool, it worked

KEY QUOTE Renewables can replace conventional energy sources without the market going down or going bust ...

 

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