Incentivising flexibility from transmission-connected loads to increase network utilisation and capacity

While these mechanisms work for large, diverse populations, they are ineffective for transmission-connected loads, which are large in scale, relatively few in number and lack diversity. With electrification and new energy-intensive industries emerging, the number of large transmission-connected loads is expected to grow. Enabling technologies are making flexibility more achievable, and many loads are increasingly pursuing the capability. With appropriate price signals and regulations, it may be possible to leverage this emerging flexibility to support the utilisation and load-hosting capability of the transmission network.

This paper outlines forms of flexibility – such as curtailment during congestion and rapid runback following contingencies – and explores how these can unlock latent transmission network capacity. It examines the interaction of these services with market and regulatory arrangements and explores customer perspectives on flexibility, informed by engagement with a wide range of stakeholders. These give rise to a range of tensions and trade-offs which must be navigated to establish arrangements which are beneficial to both loads and networks. Finally, the paper proposes a framework for incentivising the provision of these services from flexible loads, alongside a suite of supporting measures.