On Thursday 10 September 2020, Elexon hosted the first ever virtual annual BSC Meeting and Seminar.
Ofgem’s CEO, Jonathan Brearley, was the keynote speaker, and the executive team also presented on their strategic priorities, performance over 2019/20 and support for the energy transition. The name for their new digital platform was also announced, Elexon Kinnect.
Elexon’s Chairman, Michael Gibbons, welcomed guests to the seminar, congratulating attendees for working together in a difficult time.
Jonathan Brearley on Ofgem’s approach to net zero
Michael Gibbons introduced Jonathan Brearley, who gave an overview of Ofgem’s current priorities, which focus on a drive to create a flexible energy system and reaching net zero, while always ensuring value for money for consumers.
Jonathan also took the time to answer questions, such as the prioritisation of the Ofgem workload during Covid-19 where he explained that the Ofgem customer survey would not take place in 2020, and the BEIS Ofgem White Paper had been delayed until early 2021, due to workload prioritisation by Ofgem and BEIS.
Elexon’s highlights during 2019/20
‘Whole solution’ code management
Elexon CEO Mark Bygraves then spoke about how Elexon’s ‘end-to-end’ business model, expertise in market arrangements, and performance assurance are allowing us to deliver a ‘whole solution‘ approach to code management. For example, during 2019/20 Elexon’s support for the energy transition included opening up the balancing mechanism to independent aggregators alongside National Grid ESO, proposing nationwide flexibility markets to support Demand Side Response and supporting development of Project TERRE in GB.
He also described how Elexon worked quickly with the BSC Panel and experts to support Elexon’s customers in managing the impact of Covid-19.
Trialing ideas in a live environment
Mark then outlined how during 2019/20, Elexon were the first code body to develop a sandbox. The sandbox allows companies to trial ideas in a live market environment. Modification P375 proposals are a ground breaking step to support net zero.
Energy transition
Lastly, he spoke about how Market-wide half hourly Settlement is the next step for the energy transition. As Elexon already plays a major role in supporting Ofgem on MHHS, they believe they can deliver the Programme Manager/System Integrator role for the implementation phase, if it is to be carried out by an industry body. Elexon’s views on this are described in their Programme Manager policy view.
Financial reports for 2019/20
Subsequently Elexon’s Chief Financial Officer Nigel Smith, outlined how Elexon delivered their services efficiently in 19/20 with a £12.4m underspend. This was mostly driven by prioritising work to meet regulatory commitments, such as Project TERRE in place of some of Elexon’s other ambitions. Ensuring Elexon aim to underspend was particularly important during Covid-19 because, as Elexon are a not-for-profit company, unused budget is always returned to customers. More detail on Elexon’s performance against budget is in their 2019/20 Financial Statements.
Elexon Kinnect – the digital platform
Digital Operations Director, Peter Stanley, then began to discuss how Elexon must make it easier for innovators to enter the market and participate in Settlement. He emphasised the importance of ensuring systems and processes are fit for the future, including how they are working to digitalise the BSC using technology including Artificial Intelligence and dynamic updates to the BSC following changes to legal text.
Peter then outlined how Elexon’s new digital platform, Elexon Kinnect, is modernising the technical architecture of the BSC in several phases. Peter also discussed how Elexon are using cloud-based, flexible, scalable technology to support the innovation needed to drive progress on net zero. It will also provide data and insights to the market, which could prove vital in supporting new product development.
Code collaboration and consolidation
Lastly, Future Markets & Engagement Director Angela Love outlined how Elexon has been championing consolidation and simplification of energy codes. Because Ofgem is reviewing system operation arrangements, Elexon believe these could be reformed alongside the codes to support net zero. At Elexon, they believe there are three options for change:
- reforming the SO roles only, leaving codes unchanged
- creating a market operator to consolidate the codes, working alongside a separate SO
- A System/Market Operator, combining the codes and system operation.
Angela also discussed how Elexon believe that a market operator working alongside the System Operator could result in simpler, faster, more coordinated code changes and better support innovation. She stated that Elexon want to work with Ofgem and the industry to achieve a better set of arrangements for the codes which serve net zero commitments and the energy transition.
Presentation and slides
See a complete collection of slides that were used during the Annual BSC Meeting.