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Energy Networks Association Open Networks Future Worlds Stakeholder Event London 3 rd September 2018

Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

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Page 1: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Energy

Networks

Association

Open Networks

Future Worlds Stakeholder Event

London

3rd September 2018

Welcome amp Introduction

Nigel Turvey

ENA Open Networks Project Chair

3

Housekeeping

Amenities

Both male and female toilets can be found in the corridor

Emergency Exit

Fire escape door is located in the corridor Signage can be found above entrance

There are no scheduled fire alarms for today

Should there be an emergency the alarm will sound and instructions will be give via the PA

system

Wifi

Login ENA Wireless

Password R0ut3rEn3rgy

Tea amp Coffee

Tea coffee and biscuits can be found next to reception or the members area

Attendance Sheet

Please sign the attendance sheet located in the far corner before departing

If you require any further information wish to take part in the consultation or are interested in hearing more

about the ENA Open Networks Project please email us at opennetworksenergynetworksorg

4

Slido

Slido is an interactive platform we are using for our QampA segments and general

feedback You are able to ask questions via Slido at any point throughout the

presentation and we will address as many of them as possible at the end of each

session If you wish to ask a question verbally please wait until the allotted QampA

segment

bull Link

ndash Website wwwslidocom

ndash AppGoogle Play store ndash search and download lsquoSlidorsquo

bull Event code ndash ENAFutureWorlds (non-case sensitive)

bull Login ndash Full name

bull Password ndash ENA (case sensitive)

Feedback Poll

We are taking feedback on Slido which is in the form of a lsquopollrsquo which you are able to

access within the appwebsite Please leave your rating and feedback before you depart

to ensure we can improve the effectiveness at future events

Introduction | Open Networks Project

Nigel Turvey

ENA Open Networks Project Chair

6

Open Networks

bull Open Networks (ON) is pan industry initiative that is laying the

foundations of a smart flexible energy system in the UK

bull Taking a whole system approach ON looks at the transition to DSO

that will create new markets and enable flexibility

bull ON is a key forum for addressing the challenges around evolving

roles and responsibilities in the short medium and long term

bull ON is a key initiative to deliver Government policy set out in the

Ofgem and BEIS Smart Systems and Flexibility Plan the

Governmentrsquos Industrial Strategy and the Clean Growth Plan

bull We are working in collaboration with Ofgem BEIS 10 of UK and

Irelandrsquos electricity network operators and other key stakeholders

from the industry

7

Collaborating Members

8

Objectives amp Timeline

The objectives of the Open Networks Project are to

1 Develop improved T-D processes around connections planning shared TSODSO services and

operation

2 Assess the gaps between the experience our customers currently receive and what they would like

and identify any further changes to close the gaps within the context of lsquolevel playing fieldrsquo and common

T amp D approach

3 Develop a more detailed view of the required transition from DNO to DSO including the impacts on

existing organisation capability

4 Consider the charging requirements of enduring electricity transmissiondistribution systems

9

Stakeholder Engagement

8 5

Undertaken 4 consultations amp planned another 2

4 webinars and 2 focus groups completed with stakeholders

Published our material on ENA website

40

Workstream 1 | T-D Process

Sotiris Georgiopoulos

UK Power Networks

11

T ndash D Process (WS1)

WS1 Products

1 Investment Processes

2 DER Services Procurement

3 Industry Framework Interactions

4 Reliability Standards amp Emergency Requirements

5 Whole System FES

6 Regional Service Requirements

7 ANM Information

8 System Wide Resource Register

9 TSO-DSO Transmission Impacts

10 Facilitating Connections ndash Current Practice for

Flexible Resources

11 Facilitating Connections ndash Action Plan and Report

12 TSODSO amp DER Data Requirements

13 Operational Data amp Control Architectures

Focussing on whole system

approaches across T and D to put in

place improved investment and

operational planning processes

Building on Phase 1 work eg DER

Services

Benefits

bull DER service opportunities

bull Input to Whole System Investment

bull Better information for stakeholders

bull Ongoing network reliability

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 2: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Welcome amp Introduction

Nigel Turvey

ENA Open Networks Project Chair

3

Housekeeping

Amenities

Both male and female toilets can be found in the corridor

Emergency Exit

Fire escape door is located in the corridor Signage can be found above entrance

There are no scheduled fire alarms for today

Should there be an emergency the alarm will sound and instructions will be give via the PA

system

Wifi

Login ENA Wireless

Password R0ut3rEn3rgy

Tea amp Coffee

Tea coffee and biscuits can be found next to reception or the members area

Attendance Sheet

Please sign the attendance sheet located in the far corner before departing

If you require any further information wish to take part in the consultation or are interested in hearing more

about the ENA Open Networks Project please email us at opennetworksenergynetworksorg

4

Slido

Slido is an interactive platform we are using for our QampA segments and general

feedback You are able to ask questions via Slido at any point throughout the

presentation and we will address as many of them as possible at the end of each

session If you wish to ask a question verbally please wait until the allotted QampA

segment

bull Link

ndash Website wwwslidocom

ndash AppGoogle Play store ndash search and download lsquoSlidorsquo

bull Event code ndash ENAFutureWorlds (non-case sensitive)

bull Login ndash Full name

bull Password ndash ENA (case sensitive)

Feedback Poll

We are taking feedback on Slido which is in the form of a lsquopollrsquo which you are able to

access within the appwebsite Please leave your rating and feedback before you depart

to ensure we can improve the effectiveness at future events

Introduction | Open Networks Project

Nigel Turvey

ENA Open Networks Project Chair

6

Open Networks

bull Open Networks (ON) is pan industry initiative that is laying the

foundations of a smart flexible energy system in the UK

bull Taking a whole system approach ON looks at the transition to DSO

that will create new markets and enable flexibility

bull ON is a key forum for addressing the challenges around evolving

roles and responsibilities in the short medium and long term

bull ON is a key initiative to deliver Government policy set out in the

Ofgem and BEIS Smart Systems and Flexibility Plan the

Governmentrsquos Industrial Strategy and the Clean Growth Plan

bull We are working in collaboration with Ofgem BEIS 10 of UK and

Irelandrsquos electricity network operators and other key stakeholders

from the industry

7

Collaborating Members

8

Objectives amp Timeline

The objectives of the Open Networks Project are to

1 Develop improved T-D processes around connections planning shared TSODSO services and

operation

2 Assess the gaps between the experience our customers currently receive and what they would like

and identify any further changes to close the gaps within the context of lsquolevel playing fieldrsquo and common

T amp D approach

3 Develop a more detailed view of the required transition from DNO to DSO including the impacts on

existing organisation capability

4 Consider the charging requirements of enduring electricity transmissiondistribution systems

9

Stakeholder Engagement

8 5

Undertaken 4 consultations amp planned another 2

4 webinars and 2 focus groups completed with stakeholders

Published our material on ENA website

40

Workstream 1 | T-D Process

Sotiris Georgiopoulos

UK Power Networks

11

T ndash D Process (WS1)

WS1 Products

1 Investment Processes

2 DER Services Procurement

3 Industry Framework Interactions

4 Reliability Standards amp Emergency Requirements

5 Whole System FES

6 Regional Service Requirements

7 ANM Information

8 System Wide Resource Register

9 TSO-DSO Transmission Impacts

10 Facilitating Connections ndash Current Practice for

Flexible Resources

11 Facilitating Connections ndash Action Plan and Report

12 TSODSO amp DER Data Requirements

13 Operational Data amp Control Architectures

Focussing on whole system

approaches across T and D to put in

place improved investment and

operational planning processes

Building on Phase 1 work eg DER

Services

Benefits

bull DER service opportunities

bull Input to Whole System Investment

bull Better information for stakeholders

bull Ongoing network reliability

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 3: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

3

Housekeeping

Amenities

Both male and female toilets can be found in the corridor

Emergency Exit

Fire escape door is located in the corridor Signage can be found above entrance

There are no scheduled fire alarms for today

Should there be an emergency the alarm will sound and instructions will be give via the PA

system

Wifi

Login ENA Wireless

Password R0ut3rEn3rgy

Tea amp Coffee

Tea coffee and biscuits can be found next to reception or the members area

Attendance Sheet

Please sign the attendance sheet located in the far corner before departing

If you require any further information wish to take part in the consultation or are interested in hearing more

about the ENA Open Networks Project please email us at opennetworksenergynetworksorg

4

Slido

Slido is an interactive platform we are using for our QampA segments and general

feedback You are able to ask questions via Slido at any point throughout the

presentation and we will address as many of them as possible at the end of each

session If you wish to ask a question verbally please wait until the allotted QampA

segment

bull Link

ndash Website wwwslidocom

ndash AppGoogle Play store ndash search and download lsquoSlidorsquo

bull Event code ndash ENAFutureWorlds (non-case sensitive)

bull Login ndash Full name

bull Password ndash ENA (case sensitive)

Feedback Poll

We are taking feedback on Slido which is in the form of a lsquopollrsquo which you are able to

access within the appwebsite Please leave your rating and feedback before you depart

to ensure we can improve the effectiveness at future events

Introduction | Open Networks Project

Nigel Turvey

ENA Open Networks Project Chair

6

Open Networks

bull Open Networks (ON) is pan industry initiative that is laying the

foundations of a smart flexible energy system in the UK

bull Taking a whole system approach ON looks at the transition to DSO

that will create new markets and enable flexibility

bull ON is a key forum for addressing the challenges around evolving

roles and responsibilities in the short medium and long term

bull ON is a key initiative to deliver Government policy set out in the

Ofgem and BEIS Smart Systems and Flexibility Plan the

Governmentrsquos Industrial Strategy and the Clean Growth Plan

bull We are working in collaboration with Ofgem BEIS 10 of UK and

Irelandrsquos electricity network operators and other key stakeholders

from the industry

7

Collaborating Members

8

Objectives amp Timeline

The objectives of the Open Networks Project are to

1 Develop improved T-D processes around connections planning shared TSODSO services and

operation

2 Assess the gaps between the experience our customers currently receive and what they would like

and identify any further changes to close the gaps within the context of lsquolevel playing fieldrsquo and common

T amp D approach

3 Develop a more detailed view of the required transition from DNO to DSO including the impacts on

existing organisation capability

4 Consider the charging requirements of enduring electricity transmissiondistribution systems

9

Stakeholder Engagement

8 5

Undertaken 4 consultations amp planned another 2

4 webinars and 2 focus groups completed with stakeholders

Published our material on ENA website

40

Workstream 1 | T-D Process

Sotiris Georgiopoulos

UK Power Networks

11

T ndash D Process (WS1)

WS1 Products

1 Investment Processes

2 DER Services Procurement

3 Industry Framework Interactions

4 Reliability Standards amp Emergency Requirements

5 Whole System FES

6 Regional Service Requirements

7 ANM Information

8 System Wide Resource Register

9 TSO-DSO Transmission Impacts

10 Facilitating Connections ndash Current Practice for

Flexible Resources

11 Facilitating Connections ndash Action Plan and Report

12 TSODSO amp DER Data Requirements

13 Operational Data amp Control Architectures

Focussing on whole system

approaches across T and D to put in

place improved investment and

operational planning processes

Building on Phase 1 work eg DER

Services

Benefits

bull DER service opportunities

bull Input to Whole System Investment

bull Better information for stakeholders

bull Ongoing network reliability

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 4: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

4

Slido

Slido is an interactive platform we are using for our QampA segments and general

feedback You are able to ask questions via Slido at any point throughout the

presentation and we will address as many of them as possible at the end of each

session If you wish to ask a question verbally please wait until the allotted QampA

segment

bull Link

ndash Website wwwslidocom

ndash AppGoogle Play store ndash search and download lsquoSlidorsquo

bull Event code ndash ENAFutureWorlds (non-case sensitive)

bull Login ndash Full name

bull Password ndash ENA (case sensitive)

Feedback Poll

We are taking feedback on Slido which is in the form of a lsquopollrsquo which you are able to

access within the appwebsite Please leave your rating and feedback before you depart

to ensure we can improve the effectiveness at future events

Introduction | Open Networks Project

Nigel Turvey

ENA Open Networks Project Chair

6

Open Networks

bull Open Networks (ON) is pan industry initiative that is laying the

foundations of a smart flexible energy system in the UK

bull Taking a whole system approach ON looks at the transition to DSO

that will create new markets and enable flexibility

bull ON is a key forum for addressing the challenges around evolving

roles and responsibilities in the short medium and long term

bull ON is a key initiative to deliver Government policy set out in the

Ofgem and BEIS Smart Systems and Flexibility Plan the

Governmentrsquos Industrial Strategy and the Clean Growth Plan

bull We are working in collaboration with Ofgem BEIS 10 of UK and

Irelandrsquos electricity network operators and other key stakeholders

from the industry

7

Collaborating Members

8

Objectives amp Timeline

The objectives of the Open Networks Project are to

1 Develop improved T-D processes around connections planning shared TSODSO services and

operation

2 Assess the gaps between the experience our customers currently receive and what they would like

and identify any further changes to close the gaps within the context of lsquolevel playing fieldrsquo and common

T amp D approach

3 Develop a more detailed view of the required transition from DNO to DSO including the impacts on

existing organisation capability

4 Consider the charging requirements of enduring electricity transmissiondistribution systems

9

Stakeholder Engagement

8 5

Undertaken 4 consultations amp planned another 2

4 webinars and 2 focus groups completed with stakeholders

Published our material on ENA website

40

Workstream 1 | T-D Process

Sotiris Georgiopoulos

UK Power Networks

11

T ndash D Process (WS1)

WS1 Products

1 Investment Processes

2 DER Services Procurement

3 Industry Framework Interactions

4 Reliability Standards amp Emergency Requirements

5 Whole System FES

6 Regional Service Requirements

7 ANM Information

8 System Wide Resource Register

9 TSO-DSO Transmission Impacts

10 Facilitating Connections ndash Current Practice for

Flexible Resources

11 Facilitating Connections ndash Action Plan and Report

12 TSODSO amp DER Data Requirements

13 Operational Data amp Control Architectures

Focussing on whole system

approaches across T and D to put in

place improved investment and

operational planning processes

Building on Phase 1 work eg DER

Services

Benefits

bull DER service opportunities

bull Input to Whole System Investment

bull Better information for stakeholders

bull Ongoing network reliability

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 5: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Introduction | Open Networks Project

Nigel Turvey

ENA Open Networks Project Chair

6

Open Networks

bull Open Networks (ON) is pan industry initiative that is laying the

foundations of a smart flexible energy system in the UK

bull Taking a whole system approach ON looks at the transition to DSO

that will create new markets and enable flexibility

bull ON is a key forum for addressing the challenges around evolving

roles and responsibilities in the short medium and long term

bull ON is a key initiative to deliver Government policy set out in the

Ofgem and BEIS Smart Systems and Flexibility Plan the

Governmentrsquos Industrial Strategy and the Clean Growth Plan

bull We are working in collaboration with Ofgem BEIS 10 of UK and

Irelandrsquos electricity network operators and other key stakeholders

from the industry

7

Collaborating Members

8

Objectives amp Timeline

The objectives of the Open Networks Project are to

1 Develop improved T-D processes around connections planning shared TSODSO services and

operation

2 Assess the gaps between the experience our customers currently receive and what they would like

and identify any further changes to close the gaps within the context of lsquolevel playing fieldrsquo and common

T amp D approach

3 Develop a more detailed view of the required transition from DNO to DSO including the impacts on

existing organisation capability

4 Consider the charging requirements of enduring electricity transmissiondistribution systems

9

Stakeholder Engagement

8 5

Undertaken 4 consultations amp planned another 2

4 webinars and 2 focus groups completed with stakeholders

Published our material on ENA website

40

Workstream 1 | T-D Process

Sotiris Georgiopoulos

UK Power Networks

11

T ndash D Process (WS1)

WS1 Products

1 Investment Processes

2 DER Services Procurement

3 Industry Framework Interactions

4 Reliability Standards amp Emergency Requirements

5 Whole System FES

6 Regional Service Requirements

7 ANM Information

8 System Wide Resource Register

9 TSO-DSO Transmission Impacts

10 Facilitating Connections ndash Current Practice for

Flexible Resources

11 Facilitating Connections ndash Action Plan and Report

12 TSODSO amp DER Data Requirements

13 Operational Data amp Control Architectures

Focussing on whole system

approaches across T and D to put in

place improved investment and

operational planning processes

Building on Phase 1 work eg DER

Services

Benefits

bull DER service opportunities

bull Input to Whole System Investment

bull Better information for stakeholders

bull Ongoing network reliability

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 6: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

6

Open Networks

bull Open Networks (ON) is pan industry initiative that is laying the

foundations of a smart flexible energy system in the UK

bull Taking a whole system approach ON looks at the transition to DSO

that will create new markets and enable flexibility

bull ON is a key forum for addressing the challenges around evolving

roles and responsibilities in the short medium and long term

bull ON is a key initiative to deliver Government policy set out in the

Ofgem and BEIS Smart Systems and Flexibility Plan the

Governmentrsquos Industrial Strategy and the Clean Growth Plan

bull We are working in collaboration with Ofgem BEIS 10 of UK and

Irelandrsquos electricity network operators and other key stakeholders

from the industry

7

Collaborating Members

8

Objectives amp Timeline

The objectives of the Open Networks Project are to

1 Develop improved T-D processes around connections planning shared TSODSO services and

operation

2 Assess the gaps between the experience our customers currently receive and what they would like

and identify any further changes to close the gaps within the context of lsquolevel playing fieldrsquo and common

T amp D approach

3 Develop a more detailed view of the required transition from DNO to DSO including the impacts on

existing organisation capability

4 Consider the charging requirements of enduring electricity transmissiondistribution systems

9

Stakeholder Engagement

8 5

Undertaken 4 consultations amp planned another 2

4 webinars and 2 focus groups completed with stakeholders

Published our material on ENA website

40

Workstream 1 | T-D Process

Sotiris Georgiopoulos

UK Power Networks

11

T ndash D Process (WS1)

WS1 Products

1 Investment Processes

2 DER Services Procurement

3 Industry Framework Interactions

4 Reliability Standards amp Emergency Requirements

5 Whole System FES

6 Regional Service Requirements

7 ANM Information

8 System Wide Resource Register

9 TSO-DSO Transmission Impacts

10 Facilitating Connections ndash Current Practice for

Flexible Resources

11 Facilitating Connections ndash Action Plan and Report

12 TSODSO amp DER Data Requirements

13 Operational Data amp Control Architectures

Focussing on whole system

approaches across T and D to put in

place improved investment and

operational planning processes

Building on Phase 1 work eg DER

Services

Benefits

bull DER service opportunities

bull Input to Whole System Investment

bull Better information for stakeholders

bull Ongoing network reliability

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 7: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

7

Collaborating Members

8

Objectives amp Timeline

The objectives of the Open Networks Project are to

1 Develop improved T-D processes around connections planning shared TSODSO services and

operation

2 Assess the gaps between the experience our customers currently receive and what they would like

and identify any further changes to close the gaps within the context of lsquolevel playing fieldrsquo and common

T amp D approach

3 Develop a more detailed view of the required transition from DNO to DSO including the impacts on

existing organisation capability

4 Consider the charging requirements of enduring electricity transmissiondistribution systems

9

Stakeholder Engagement

8 5

Undertaken 4 consultations amp planned another 2

4 webinars and 2 focus groups completed with stakeholders

Published our material on ENA website

40

Workstream 1 | T-D Process

Sotiris Georgiopoulos

UK Power Networks

11

T ndash D Process (WS1)

WS1 Products

1 Investment Processes

2 DER Services Procurement

3 Industry Framework Interactions

4 Reliability Standards amp Emergency Requirements

5 Whole System FES

6 Regional Service Requirements

7 ANM Information

8 System Wide Resource Register

9 TSO-DSO Transmission Impacts

10 Facilitating Connections ndash Current Practice for

Flexible Resources

11 Facilitating Connections ndash Action Plan and Report

12 TSODSO amp DER Data Requirements

13 Operational Data amp Control Architectures

Focussing on whole system

approaches across T and D to put in

place improved investment and

operational planning processes

Building on Phase 1 work eg DER

Services

Benefits

bull DER service opportunities

bull Input to Whole System Investment

bull Better information for stakeholders

bull Ongoing network reliability

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 8: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

8

Objectives amp Timeline

The objectives of the Open Networks Project are to

1 Develop improved T-D processes around connections planning shared TSODSO services and

operation

2 Assess the gaps between the experience our customers currently receive and what they would like

and identify any further changes to close the gaps within the context of lsquolevel playing fieldrsquo and common

T amp D approach

3 Develop a more detailed view of the required transition from DNO to DSO including the impacts on

existing organisation capability

4 Consider the charging requirements of enduring electricity transmissiondistribution systems

9

Stakeholder Engagement

8 5

Undertaken 4 consultations amp planned another 2

4 webinars and 2 focus groups completed with stakeholders

Published our material on ENA website

40

Workstream 1 | T-D Process

Sotiris Georgiopoulos

UK Power Networks

11

T ndash D Process (WS1)

WS1 Products

1 Investment Processes

2 DER Services Procurement

3 Industry Framework Interactions

4 Reliability Standards amp Emergency Requirements

5 Whole System FES

6 Regional Service Requirements

7 ANM Information

8 System Wide Resource Register

9 TSO-DSO Transmission Impacts

10 Facilitating Connections ndash Current Practice for

Flexible Resources

11 Facilitating Connections ndash Action Plan and Report

12 TSODSO amp DER Data Requirements

13 Operational Data amp Control Architectures

Focussing on whole system

approaches across T and D to put in

place improved investment and

operational planning processes

Building on Phase 1 work eg DER

Services

Benefits

bull DER service opportunities

bull Input to Whole System Investment

bull Better information for stakeholders

bull Ongoing network reliability

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 9: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

9

Stakeholder Engagement

8 5

Undertaken 4 consultations amp planned another 2

4 webinars and 2 focus groups completed with stakeholders

Published our material on ENA website

40

Workstream 1 | T-D Process

Sotiris Georgiopoulos

UK Power Networks

11

T ndash D Process (WS1)

WS1 Products

1 Investment Processes

2 DER Services Procurement

3 Industry Framework Interactions

4 Reliability Standards amp Emergency Requirements

5 Whole System FES

6 Regional Service Requirements

7 ANM Information

8 System Wide Resource Register

9 TSO-DSO Transmission Impacts

10 Facilitating Connections ndash Current Practice for

Flexible Resources

11 Facilitating Connections ndash Action Plan and Report

12 TSODSO amp DER Data Requirements

13 Operational Data amp Control Architectures

Focussing on whole system

approaches across T and D to put in

place improved investment and

operational planning processes

Building on Phase 1 work eg DER

Services

Benefits

bull DER service opportunities

bull Input to Whole System Investment

bull Better information for stakeholders

bull Ongoing network reliability

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 10: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Workstream 1 | T-D Process

Sotiris Georgiopoulos

UK Power Networks

11

T ndash D Process (WS1)

WS1 Products

1 Investment Processes

2 DER Services Procurement

3 Industry Framework Interactions

4 Reliability Standards amp Emergency Requirements

5 Whole System FES

6 Regional Service Requirements

7 ANM Information

8 System Wide Resource Register

9 TSO-DSO Transmission Impacts

10 Facilitating Connections ndash Current Practice for

Flexible Resources

11 Facilitating Connections ndash Action Plan and Report

12 TSODSO amp DER Data Requirements

13 Operational Data amp Control Architectures

Focussing on whole system

approaches across T and D to put in

place improved investment and

operational planning processes

Building on Phase 1 work eg DER

Services

Benefits

bull DER service opportunities

bull Input to Whole System Investment

bull Better information for stakeholders

bull Ongoing network reliability

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 11: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

11

T ndash D Process (WS1)

WS1 Products

1 Investment Processes

2 DER Services Procurement

3 Industry Framework Interactions

4 Reliability Standards amp Emergency Requirements

5 Whole System FES

6 Regional Service Requirements

7 ANM Information

8 System Wide Resource Register

9 TSO-DSO Transmission Impacts

10 Facilitating Connections ndash Current Practice for

Flexible Resources

11 Facilitating Connections ndash Action Plan and Report

12 TSODSO amp DER Data Requirements

13 Operational Data amp Control Architectures

Focussing on whole system

approaches across T and D to put in

place improved investment and

operational planning processes

Building on Phase 1 work eg DER

Services

Benefits

bull DER service opportunities

bull Input to Whole System Investment

bull Better information for stakeholders

bull Ongoing network reliability

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 12: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Workstream 2 | Customer Experience

Jason Brogden

ENA Open Networks Project Director

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 13: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

13

Customer Experience

WS2 Products

1 Good Practice ahead of Connection

Applications

2 Management of Capacity

3 Explanation of lsquoTermsrsquo amp lsquoDefinitionsrsquo

4 Information on Flexibility Services

5 Good Practice Following Connection

Applications

6 Guidance on Post Connection Changes

7 Provision of Constraint Information

8 2017 Product Updates

Improve information for

customers to support network

connection and service provision

Benefits

bull Enhanced information on

connections amp services

bull More consistent customer

experience

bull Better practice across Network

Operators

bull Improved use of capacity

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 14: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Workstream 3 | DSO Transition

Stewart Reid

Scottish amp Southern Electricity Networks

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 15: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

15

DSO Transition

WS3 Products

1 SGAM Modelling of DSOs and DER Procurement

2 Further SGAM Modelling of DSO Functionality

3 Market Agnostic DSO Elements

4 Independent Impact Assessment of Models

5 DSO Model Validation amp Review Including Public

Consultation

6 Key Enablers for DSO

7 Further Trials to Address Gaps in DSO Functionality

8 Preferred DSO Models amp Proposed Implementation

Plan

Develop and model DSO

functionality

Proposed implementation plan and

ldquono regretsrdquo DSO actions

Impact Assessment of different

DSO models

bull Independently reviewed

bull Build evidence base to provide to

policy-makers

Benefits

bull Articulation of DSO value

bull Early implementation of key areas

of DSO functionality to benefit

customers

bull More consistent DNO practice

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 16: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Workstream 4 | Network Charging

Nigel Turvey

ENA Open Networks Project Chair

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 17: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

17

Network Charging

bull Support Ofgemrsquos CFF (Charging Futures Forum) and related Task Forces

bull Support Ofgemrsquos CDB (Charging Delivery Body) in translating the results from the CFF into manageable actions and ensuring their delivery

bull Provide support on charging to the wider Open Networks project

bull Develop recommendations to remove inefficient signals in charging and remuneration of TSODSO services

bull WS4 have contributed significantly to the delivery of the Electricity Network Access amp Forward Looking Charges Final Report and Conclusions report delivered under the CFF Task Forces

bull httpwwwchargingfuturescommedia1203access-and-flc-final-report-and-conclusionspdf

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 18: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Coffee Break

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 19: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Ofgem PerspectiveEdwin Tammas-Williams

Ofgem

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 20: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

20

RPI-X RIIO 1 RIIO-2 and beyond

The energy transition and network company regulation

Our regulatory stances ndash What will underpin Ofgemrsquos approach

bull Promoting effective competition to deliver for consumers bull Driving value in monopoly activities through competition and

incentive regulation bull Supporting innovation in technologies systems and business models bull Managing risk for efficient and sustainable energybull Protecting the interests of consumers in vulnerable situations

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 21: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

21

The challenge

The energy landscape is changing but how it is changing is uncertain

2004

2016

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 22: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

22

The challenge

There are many perspectives on how to achieve this from evolution to revolution

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 23: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

23

What the challenge means for us

1 Change is necessary

2 The nature and speed of that change is highly uncertain so reforms must be resilient

3 Policy and regulatory changes (radical or otherwise) require a comprehensive evidence basea) Stakeholder expertise is critical b) Building on sound analysis is neededc) A wide range of perspectives adds value

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 24: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

24

ENA Future Worlds consultation

Responses to the consultation and the impact assessment will form part of our evidence base for possible regulatory changes

We want the outputs to be as useful as possible therefore engagement with the process is essentialbull Ensure the analysis provided meaningfulbull Fully consider impacts on a broad range of stakeholders bull Ensure wider perspectives on roles and delivering functions are taken into account

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 25: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

25

Ofgem perspective

bull The energy system is changing and the right institutions and interfaces are needed (with the right regulatory framework) to maximise consumer value

bull There are currently hugely divergent perspectives on what the right arrangements look like

bull This consultation is part of the evidence base we will use to inform our regulatory design and thus we urge stakeholders to engage

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 26: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Consultation Overview amp

How to get InvolvedAndy Wainwright

National Grid ESO

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 27: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

28

Future Worlds Introduction

lsquoFuture Worldsrsquo is the output of a

substantial stakeholder engagement

process to map and describe a number of

potential future electricity networks

(ldquoFuture Worldsrdquo) capable of supporting

the smart decentralised energy industry

that the UK is transitioning towards

At this stage we do not seek to

recommend any particular Future World

but instead to understand them creating

a common view of how each works

allowing informed debate and decisions

to follow

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 28: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

29

Overall aims

bull The Future Worlds consultation builds on the

2017 Commercial Principles paper but

considers all the functions of DSO rather than

simply market models

bull In brings together many of the key products for

workstream 3 in 2018 such that the overall aims

of the consultation are

bull Obtain feedback on the lsquofuture worldsrsquo

developed and their associated SGAM

models including whether we have

reflected stakeholder interactions

appropriately

bull Review draft criteria and proposed

structure for the Impact Assessment

bull Obtain feedback on both key enablers and

market agnostic DSO elements to inform

these products

Product 5 Future Worlds

Consultation

Products 1amp2 SGAM modelling

Product 3 Market

agnostic DSO elements

Product 4 Assessment

of Future Worlds

Product 6 Key enablers

for Future Worlds

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 29: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

30

Consultation approach

The Future Worlds consultation document

bull High level document summarising the worlds from a stakeholder perspective

bull Intended audience Stakeholders who want a high level view of our work

bull Feedback via consultation responses

The EATL modelling summary

bull Detailed document produced by EA Technology giving further detail of the worlds developed and their outputs

bull Intended audience Stakeholders who want to understand the future worlds in detail

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 30: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

31

Consultation areas

bull A description of the five Future WorldsThe Future Worlds

bull A high level summary of the methodology employed to build the Smart Grid Architecture Models

The Smart Grid Architecture Model

bull An overview of why the principle of neutral market facilitation is importantThe principle of neutral market

facilitation

bull Key stakeholder insights for each of the 23 actors described in the modelsStakeholder insights

bull Our intended approach to impact assessment modelling of the worlds inviting your viewsAssessing the Worlds

bull A description of the key enablers needed to deliver the future worldsKey enablers for the Future

bull A summary of our proposed next steps including our work on least regrets analysisProposed next steps

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 31: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

32

How to get involved

We using a variety of means to reach out to stakeholders during the consultation period which will run between 31st July 2018 and 25th September 2018 inclusive

Stakeholder Events

Webinar 1 - 21st August 2018

Edinburgh - 29th August 2018

Webinar 2 - 13th September 2018

London - 3rd September 2018

Please visit the ENA Open Networks Future Worlds page for further information You can respond to the consultation via email opennetworksenergynetworksorg

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 32: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Introduction to SGAM Modelling The 5 Future Worlds

Actors in the Future Worlds

Tim Manandhar

UKPN

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 33: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

34

Introduction to SGAM Modelling

The Smart Grid Architecture Model (SGAM) methodology is a way to represent a complex

electricity system and break it down into is individual parts It is three dimensional which allows

complex aspects of the electrical network to be considered from a variety of perspectives

Commercial Principles Paper (2017)

Consulted industry on commercial principles to promote flexibility markets and potential market models

Smart Grid Architecture Modelling

Further development of industry preferred market models through a series of industry workshops with consideration of additional functions and processes required for DSO

Future Worlds Consultation

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 34: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

35

Developing the Worlds

The Future Worlds

Commercial Principles

paper

DSO Functions

Principle of neutral market

facilitation

Stakeholder feedback

The Future Worlds have been developed from other Open Networks products

bull The market models described in the 2017 Commercial Principles paper

bull The DSO functions and activities

bull The principle of neutral market facilitation

We have also used stakeholder feedback from

bull The Commercial Principles paper

bull The 2018 Open Networks work programme

bull A series of industry workshops

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 35: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

36

Five Future Worlds

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 36: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

37

The Future Worlds - Consultation

Questions

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 37: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

38

Stakeholder Insights

bull Following stakeholder feedback a significant part of this consultation is devoted to

describing the impact of each of the future worlds on each identified stakeholder group

We are interested in your thoughts on the material presented and the approach we have

taken

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 38: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

39

Stakeholder Insights - Consultation

Questions

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 39: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Principles of Neutral Market Facilitation

Steve Atkins

Scottish amp Southern Electricity Networks

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 40: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

41

The Principle of Neutral Market

Facilitation

bull The Future Worlds consider a range of parties who may

facilitate flexibility markets in the future

ndash Distribution System Operators (DSOs)

ndash National Grid in its role as Electricity System Operator (ESO)

ndash Third party organisations taking on the role of lsquoFlexibility Co-

ordinators

bull We believe that all parties facilitating flexibility markets

will need to adopt the principle of neutral market

facilitation

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 41: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

42

Principles of Neutral market Facilitation-

Consultation Questions

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 42: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Stakeholder InsightsHelen Stack | Centrica

Charles Wood | Energy UK

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 43: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Energy UK ndash An Introduction

Energy UK ndash Stakeholder Insights on Future Worlds

44

Energy UK is the trade association for

the GB energy industry with a

membership of over 100 suppliers

generators and other stakeholders with

a business interest in the production and

supply of energy for domestic and

business consumers

Our membership covers over 90 of

both UK power generation and the

energy supply market for UK homes We

also represent the diverse nature of the

UKrsquos energy industry ndash from established

FTSE 100 companies right through to

new growing suppliers generators and

others which now make up over half of

our membership

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 44: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Engagement in the Future Worlds Project

Energy UK ndash Stakeholder Insights on Future Worlds

45

Advisory Group

bull Two Seats for Energy UK

bull Two Seats for Energy UK members

SGAM Workshops

bull Energy UK and members attended and fed into the initial

discussions on the models and pushed for the inclusion of Models

D and E

Friendsrsquo Review

bull Energy UK fed into discussions on the format of the consultation

examining how to make a three-tiered consultation accessible

bull Energy UK was given a look at the consultation document shortly

ahead of publication for drafting comments

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 45: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Energy UK Position on Future Worlds

Energy UK ndash Stakeholder Insights on Future Worlds

46

The Consultation

This is a complex area of the energy system transition and as such is a consultation

with a lot of levels of detail to it These events are important to ensuring that a wide

audience is able to input and arenrsquot put off by the scale of the challenge

Neutral Market Facilitation

ESO TO DSO and DNO need to continue to hold a role as neutral market

facilitators maintaining a system which prioritises the development of market

solutions

To ensure competition continues regulated monopolies should be able to access

markets but should not play into them

No-Loss Actions

Whilst Energy UK sees these models as useful none of them are exactly matched to

our ideal model There are however certain actions that sit across the models and

should be taken forwards

Increased Information gathering and sharing capabilities particularly on distribution-

level networks is a crucial element to move forwards with regardless of the future

shape of the energy system

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 46: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Energy UK ndash Additional Thoughts

Energy UK ndash Stakeholder Insights on Future Worlds

47

ESO Coordinates

The ESO should retain overall responsibility for System Balancing with an obligation

on DNOrsquos and DSOrsquos to declare their regional position in the same manner that

Generators are required to for their plant

The ESO should also continue to hold the ability to call upon DNO and TO assets to

address a national balancing issue The surrounding communications capabilities will

need to be further developed to ensure that ESO and DSO actions are not in conflict

Elements of World B World D and World E will be needed in future and this

consultation process is important in exploring those worlds in greater detail

DNO DSO Division

There is still uncertainty over the form of a DSO and how to appropriately separate

that from the functions of the DNO

Recent changes to increase the independence of the ESO from the TO should be

reflected in the process of creating a DSO model It is important that we keep an

open mind in order to find the best solution for consumers

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 47: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Thank You

CharlesWoodEnergy-UKorguk

082018

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 48: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

49

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 49: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Lunch

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 50: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

The Smart Grid Architecture Model amp Demo (SGAM)

Manuel Castro amp Mark Sprawson

EA Technology

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 51: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

52

Why we used SGAM

methodology

The purpose of the SGAM modelling is

twofold firstly to compare and contrast

the five future worlds and secondly to act

as a base model for DNOs to build their

required architectures interfaces and

business processes around for the DSO

transition To enable detailed comparison

of the future worlds the interactions

between actors are captured and

categorised as part of the SGAM work

Not all the layers have been populated at this point There are more inputs required from trials

and as the modelling becomes more detailed it is more appropriate that each network

organisation models their particular system specifically to account for regional differences

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 52: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

53

How the SGAM Model was built

The model was built using a top down approach

through a series of industry workshops starting with

the main functions of a DSO as a neutral market

facilitator

DSO Functions

System Coordination

Network Operation

Investment Planning

Connections amp Connections Rights

System Defence and Restoration

Service Optimisation

Charging

ServiceMarket Facilitation

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 53: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

54

How the SGAM Models are

presented

bull Full models available

online as interactive

webpages

bull Can navigate by

function or by actor

bull Understand data flows

and interactions

between different

actors in different

worlds

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 54: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

55

Demonstration of Models

The Models

bull Links to the 5 SGAM Future Worlds to allow industry experts to explore the detail

bull Intended audience Stakeholders who value being able to explore and critique the SGAM models

bull World A World B World C World D World E

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 55: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

56

The Smart Grid Architecture Model-

Consultation Questions

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 56: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Least Regrets Elements

Steve Atkins

Scottish amp Southern Electricity Networks

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 57: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

58

Least Regrets Analysis

bull Assessment of the five

future worlds has identified

areas of common

functionality between the

worlds

bull These areas could present

opportunities to implement

aspects of smart grid now

bull We are interested in your

thoughts on this work to

inform our next steps

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 58: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

59

Areas of no regrets by function

0

20

40

60

80

100

System

Coordination

Network Operation Investment

Planning

Connections and

Connection Rights

System Defence

and Restoration

Services and

Market Facilitation

Service

Optimisation

Charging

Pro

po

rtio

no

b o

f least-reg

rets a

cro

ss 5

w

orld

s

Areas of no regrets tend to be aligned with achieving whole-system objectives

through long-term planning establishing regulatory frameworks

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 59: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

60

Areas of no regrets by function

60

Function Key areas of no regrets

System Coordination

bull Coordinated outage planning

bull Regulatory framework for flexibility service provision

bull Flexibility compliance to activationdispatch signals

Network Operation

bull Development of network stability mechanism

bull Outage requests

bull Real-time network monitoring for thermal and voltage excursions

bull Activation of flexibilities and smart grid solutions

Investment Planningbull Traditional investment planning

bull Quality of supply planning standards

Connections and Connection

Rights

bull Regulatory development of standard connection agreements for

flexibility

bull Recovery of unused connection capacity

System Defence and Restoration

bull Black Start

bull Islanding

bull Voltage reduction

Services and Market Facilitation

bull Assess requirements for flexibility services

bull Procure and activate flexibility

bull Conflict mitigation and resolution

Service Optimisation

bull Regulatory framework for market failure and last resort measures

bull Arrangements for activation of last resort measures

bull Development of smart grid solutions

Chargingbull Exchange of information to determine market charges

bull Access charges for flexibility resources

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 60: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

61

Least Regrets Analysis- Consultation

Questions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 61: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

62

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 62: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Coffee Break

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 63: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Assessing the Worlds

Ross Thompson

UK Power Networks

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 64: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

65

Assessing the worlds

Purpose

The purpose of the Impact Assessment is to provide an independent relative analysis of these Worlds to help understand the relative costs and benefits between the different Worlds to provide an evidence base for future market structures and corresponding policy regulatory thinking

Approach

Employing independent external resources to assist with assessing each world against the agreed criteria Where possible assessment will be quantified using robust data and where qualitative assessment is appropriate evidence for conclusions will be documented Engagement of all stakeholders will be an integral part of this process to ensure the analysis is informed by the broadest set of evidence possible

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 65: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

66

Assessing the worlds ndash draft

assessment criteria

1 Strategic case - How well does each model address the ldquocase for

changerdquoEnhanced Customer experience

Choice Fairness Affordability Confidence and Trust

Greater environmental sustainability

Facilitating greater energy efficiency decarbonisation of electricity generation and heattransport and more

electricity consumed closer to point of generation ie lower losses

2 Economic case - How efficiently does each model address the

ldquocase for changerdquoFinancial benefits

Cost of implementation vs benefits Cost of operation vs benefits and Expected benefits

Whole system optimisation

Supports whole system optimisation Optimises locally Brings more flexibility into the system Manages

conflicts Avoids duplication and Exploits synergies

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 66: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

67

Assessing the worlds ndash draft

assessment criteria

3 Commercial case - How deliverable is each model ndash are the markets

viable and regulation appropriateMarket viability and Appropriate regulation

4 Financial case - How viable are the funding arrangements for each

modelRegulatory funding and Market facilitation

5 Management case - How viableachievable is each model in terms

of complexity and alignment of responsibilitiesactions with rolesIndustry structure and organisation

Rules and regulation Facilitates neutral Complexity Implementation and Future proof

Technical performance

Safety risk Service reliability and availability Security Resilience and recoverability and Clear

dischargeable accountability for technical performance

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 67: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

68

Impact Assessment proposed

timeline

bull The Impact Assessment will be undertaken by independent consultants

bull Mindful of timescales we are already progressing the consultant selection

bull We have developed a timeline which will allow for responses to the Future Worlds consultation to be incorporated into the assessment approach

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 68: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

69

Assessing the Worlds - Consultation

Questions

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 69: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Key Enablers for the Future

Alan Collinson

SP Energy Networks

71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

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71

Key Enablers for the Future

bull We have identified a number

of key enablers required to

be developed to facilitate the

Future Worlds These

enablers are required

regardless of the world

developed

bull We are interested in your

views on this list and short

term priorities for ensuring

enablers are in place

bull Regulatory changes

bull Organisational changes

Changes to industry structure

bull Market engagement

bull Contract requirements

bull Funding

Developing a market-based approach

bull Communications infrastructure

bull IT systems

bull Network visibility and control

Facilitating information and data exchange

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 71: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

72

Changes to Industry Structure

bull Regulatory changes (guiding principles)

ndash Promotion of effective markets amp competition

bull Customer choice customer control

bull Cost-reflective realising value level playing field

ndash Smart Grids amp Flexibility

bull Smart technologies technical amp commercial innovation

ndash Secure affordable sustainable energy system

bull Organisational changes

ndash Closer internal interactions

ndash Closer DSO-ESO interactions

ndash Closer interactions with customers

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 72: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

73

Developing a Market-based

Approach

bull Market Engagementndash Raise awareness

ndash Increase participation

ndash Increase market liquidity

ndash Increase competition

bull Contract Requirementsndash Technical requirements amp specifications

ndash Open access for all potential providers

ndash Payment mechanisms

ndash Quantification of service delivery

ndash Settlement arrangements

bull Funding

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 73: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

74

Facilitating Information and Data

Exchange

bull Communications amp IT Systemsndash More data faster reliable quality

ndash Internal External Public

ndash Integrated solution (IT amp OT)

ndash Cyber security

ndash Data analytics forecasting

bull Network Visibility amp Controlndash Monitoring of the secondary (LV) network

ndash Smart meter data

ndash Network automation remote control

75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

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75

Key Enablers- Consultation

Questions

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 75: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Proposed Next StepsAndy Wainwright

National Grid ESO

77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

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77

Next Steps

bull DSO definition amp functions

bull DSO functions

bull Commercial Principles paper

2017 work programme

bull SGAM modelling

bull Key Enablers

bull Future Worlds consultation

Development phase bull Refining SGAM amp key

enablers

bull Impact assessment

bull Least regrets analysis

Review phase

bull Evidence pack for BEIS and Ofgem

bull Impact assessment consultation

Final conclusions

QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

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QampAwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

78

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

Page 78: Energy Networks Association Open Networks Future Worlds ... · 8 Objectives & Timeline The objectives of the Open Networks Project are to: 1. Develop improved T-D processes around

Final Comments and Conclusions

Nigel Turvey

ENA Open Networks Project Chair

80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

88

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80

bull The opportunities and implications of these Future Worlds are significant societally commercially and technically and we recognise it is important that to get responses from a wide variety of interested parties to inform the further development of these Future Worlds

bull We welcome all feedback on our work In the main consultation document we ask a number of questions and would value your thoughts Responses to the consultation can be emailed to opennetworksenergynetworksorg All responses must be submitted to ENA by 1800 on 25th September 2018

We welcome feedback from all our stakeholders If you have any comments that you would like to share please feel free to submit them to opennetworksenergynetworksorg

Wrap Up

Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

84

85

86

87

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Feedbackwwwslidocom

Event Code ENAFutureWorldsPasscode ENA (case sensitive)

81

Additional Slides

82

83

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