From today (7 November) independent aggregators of electricity flexibility can start the process to register to participate in the wholesale electricity market, resulting from a rule change made by Elexon.
Independent aggregators (or Virtual Lead Parties as they are known in the Balancing and Settlement Code – BSC) are not affiliated with licensed electricity suppliers. Currently, they are only allowed to offer services in the Balancing Mechanism, on behalf of the flexibility providers they represent.
Today, Elexon has implemented BSC Modification P415 ‘Facilitating access to wholesale markets for flexibility dispatched by Virtual Lead Parties’ which allows independent aggregators to compete in the wholesale market against suppliers, by registering as a Virtual Trading Party.
Rule change supports decarbonisation goals
This rule change will help decarbonisation of the electricity system, as many independent aggregators represent consumers, including shops and businesses that are prepared to either increase or reduce power consumption and help to keep the electricity system in balance.
Elexon Chief Executive Peter Stanley said:
“Flexibility must play a much more prominent role in managing supply and demand if the energy sector is to meet the Government’s Clean Power 2030 and Net Zero targets. The National Energy System Operator’s latest analysis shows scenarios where GB would have around four times as much flexibility by 2030 compared with what was available in 2023*.
“To reach that potential, we must create more opportunities for consumers to provide flexibility services. Reforms such as P415 can have a major impact, overcoming barriers to flexibility, and driving growth.”
“During 2025, Elexon will be transitioning into the market facilitator role, and preparing to deliver this from early 2026. As the market facilitator, Elexon will be fully focussed on working with flexibility market participants and Ofgem to deliver more open, coordinated and transparent local flexibility markets, and supporting their growth.”
*The NESO’s Clean Power 2030 report published on 6 November, contains an analysis on Page 19 showing that around 12GW of demand flexibility could be available by 2030 compared with 3GW which was available in 2023.
Demand flexibility opportunity chart from NESO Clean Power 2030 report
Elexon helps 40 companies register for roles in the electricity market
Since April 2024, Elexon has helped 40 companies register for a range of roles in the electricity market. This includes six companies that have registered as Virtual Lead Parties (a role which allows independent aggregators to participate in the Balancing Mechanism).
Altogether 22 Virtual Lead Parties are currently registered, enabling them to offer flexibility services in the Balancing Mechanism. Elexon created the Virtual Lead Parties role when it opened up the Balancing Mechanism to independent aggregators in 2019.
Elexon is in discussions with seven companies that are interested in applying for the new Virtual Trading Party role.