As part of our mission to provide access to affordable, low-carbon energy services, ReFLEX Orkney set out to deliver a funded solar & battery solution to householders and businesses.
Unfortunately, the process has been more drawn out than any of us could have expected. Several financial and regulatory hurdles, as well as grid constraint issues, have meant that we cannot progress with a financed solution for solar and battery installations for businesses in Orkney.
As an innovation project, ReFLEX is committed to sharing our learning – progress and challenges – to enable the industry to progress towards a clean energy systems model as soon as possible.
Read on for more details on the challenges we faced.
Barriers to solar and battery deployments
We have found there to be significant barriers to progressing battery and PV systems for businesses in Orkney, some of which have been overcome, however key hurdles remain.
Orkney grid constraints
Orkney has a generation-constrained electricity grid: there is high generation capacity relative to demand and limited network capacity (especially links to the Scottish mainland). To manage this, SSEN operates an Active Network Management (ANM) system in Orkney. The ANM curtails generators at peak generating times (e.g. when it’s really windy) to limit supply. Therefore, Orkney is not able to harness its full renewable energy potential.
This we knew before we started the project; in fact it’s one the key challenges we were looking to overcome to enable Orkney to harness and store more renewable energy and benefit from its use locally.
With the status quo, if you want to install a PV and battery system in a commercial setting (ie. above 3.68kW per phase), there is an additional cost, in the region of tens of thousands of pounds for businesses, to connect the PV and battery to Orkney’s ANM.
Business model for upfront funding
Through ReFLEX, we aimed to offer a funded PV and battery system at no up-front cost. This funded solution would see us sell electricity from the PV/battery system to business customers at a low rate. To enable this solution ReFLEX was pioneering a connection with the ANM system via the ReFLEX control platform (FlexiGrid), which ultimately aimed to significantly reduce the costs to connect to the ANM through reducing the need for expensive onsite control equipment and software development for each new connection added to the ANM.
However, we found that the distribution network operator (SSEN) can, and likely will, curtail generation at times when the electricity grid in Orkney is overloaded. This could lead to your system producing significantly less generation over its lifetime making the solution economically unviable relative to consuming grid supplied electricity.
To enable the funded PV and battery solution to work we needed clarification that SSEN would not curtail ‘behind-the-meter’ generation and instead only curtail ‘excess electricity’ from being exported from the property thus allowing generators to still supply their own electricity demand during a period of curtailment.
We have been working hard with SSEN and the regulator, Ofgem, to resolve the situation and allow customers to self-supply from onsite generation without curtailment being applied. Unfortunately, a recent regulatory ‘steer’ from Ofgem following direct consultation with them on this point, detailed that newly installed generators (PV and battery) could be de-energised by the DNO (SSEN) during periods of curtailment on an ANM system. This ultimately means that SSEN can ‘reach behind’ the meter and de-energise small scale generation. This is the key stumbling block.
Can I progress with a solar and battery installation without ReFLEX?
Yes, businesses can connect and notify generators in accordance with G98 connection rules. This applies to installations which have a total capacity at or below 3.68kW per phase.
In the absence of a solution for installing larger PV and battery systems, some businesses may find that a smaller system (capped at 3.68kW per phase) is suitable for their needs. For example, in commercial settings which have a 3 phase connection, an 11kW hybrid inverter could be installed. Depending on the inverter specification, it might be possible to install up to 20kWp of solar PV. So long as the hybrid inverter size is limited to 3.68kW per phase the grid & ANM connection constraints explained above are not relevant, your installer would follow the ‘Connect & Notify’ process with the DNO.
For larger installs (above 3.68kW per phase), commercial customers can apply for a G99 connection themselves however any new connection would likely be subjected to the same restrictions explained above with the added cost of connecting to the ANM. However, customers bringing additional demand may be seen more favourably in a G99 application process.
What progress has been made?
When the ReFLEX Orkney project launched in 2019, the Orkney grid was closed to new generation connections. Following discussions with SSEN the network was reopened for new connections, albeit with the restrictions above in place.
ReFLEX has helped to identify an alternative route to the full ANM connection for small scale generation (3.68 / phase - 50 kW) through an API (application programming interface) based integration with an electricity aggregator. This is yet to be implemented due to the high risks associated with development but there remains a potential that this could be implemented in the future.
The business case for financed behind-the-meter PV / battery systems has been de-risked for areas which are not generation constrained like Orkney. Through our modelling work on the PV / battery offering a good deal of progress was made in exploring the financial and regulatory risks. So our research could support development of financed PV/battery systems elsewhere in the UK.
So where do we go from here?
Had we managed to find a solution to the above, this could have had significant impacts on renewable generator installations in Orkney, and other areas with ANM schemes, enabling more renewable power to be generated and stored.
We are feeding this learning back to the ReFLEX Orkney funders, UKRI, as this issue is a major road block in progressing to smart local energy systems.
