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F

THE BALANCE OF POWER


Lucrative power balancing
schemes can help the milling
and grain industry unlock
long-term revenues of 90,000
per Megawatt from National
Grid or EirGrid

by Michael Phelan, CEO at National Grid and EirGrid


Aggregator, Endeco Technologies

any in the milling and grain


sector may be unaware that
there is a significant new
revenue stream available to
progressive and forwardthinking mills. It focuses
on the use of energy, and
how by turning the power
down for a relatively short
period each year in line with National Grids and EirGrids
requirements, companies can enjoy considerable and long-term
financial rewards.

High Energy Consumption

The milling and grain industry is by its very nature an intensive


user of energy. In flour mills, energy-using equipment as
such roller mills, purifiers, sifters, fans and conditioning kit is
commonplace. The equipment found in animal feed mills such
as pellet presses, steam boilers, grinders and fans is equally as
energy-intensive.
Unfortunately this level of intensive energy use across industry
represents a problem in the power sector, where only the most
oblivious will be unaware that there exists a somewhat precarious
electricity supply situation. According to a Guardian newspaper
report earlier in 2016, UK electricity demand is expected to
outstrip supply by over 40% within 10 years.

Financial opportunities for energy-intensive businesses

Many thought renewables would deliver the answer, but


in reality the inflexibility of renewable energy sources in
conjunction with the difficulty of controlling grid stability in realtime, represents a major challenge for grid operators. In simple
terms, when generation and energy demand are imbalanced, a
change of frequency in the grid system occurs, which is made
worse by the intermittent nature of wind and solar sources.
The requirement for quicker grid balancing and frequency is
why the system operators (National Grid (in the UK) and EirGrid
and SONI in Ireland) now offer a number of opportunities for
energy-intensive businesses, with very lucrative rewards for those
able to offer real-time response.
Ofgem, the industry regulator, is also on-board, recently laying
out five priority areas of focus, central to which is a pledge to
52 | October 2016 - Milling and Grain

make the UK energy system more flexible. With this in mind,


Ofgem is actively encouraging businesses to engage in demandside response.

Demand-side response

Firm frequency response (FFR) and the new Dynamic FFR, as


well as the forthcoming (2017) Enhanced FFR, are schemes that
all form part of the system operators broad DSR (Demand Side
Response) suite of solutions. In essence, these schemes involve
removing sufficient load from the grid to stabilise frequency.
To help boost uptake, the National Grid and EirGrid are offering
those that participate the potential to earn extra income from
assets by adjusting power consumption in real-time. As a result,
grid operators can reduce the requirement for coal and gas-fired
reserves to be ready to supply power at short notice.

Earn up to 90,000 per megawatt

This is where the milling and grain industry can accrue


significant financial rewards. To provide an indication, in the
UK sums of up to 90,000 are currently achievable for every
megawatt (MW) of average onsite energy consumption turn
down. In Ireland, the latest scheme DS3 System Services also
offers very significant sums per megawatt.
Any mill expecting to endure weeks if not months of blackouts
to see financial savings on such levels would be wrong. In the
first instance, the requirement is for turn-down not turn-off,
and secondly, the sums stated are in return for around 10 (on
average) turn-down events per year, lasting for a maximum
of just 30 minutes each. In total, this adds up to on average around 5 hours a year.
For those thinking there must be a catch, there isnt. The grid
operators are prepared to pay such high rewards as it is obliged
to control frequency within the limits specified in the Electricity
Supply Regulations, i.e. 1% of nominal system frequency
(50.00Hz) except in abnormal or exceptional circumstances. It
must therefore ensure that sufficient generation and/or demand
is reserved in automatic readiness to manage all credible
eventualities that might produce frequency variations.

Virtual power plant

As every milling and grain facility will have its own array
of assets and requirements, comprehending and choosing the

optimum DSR scheme is vital. With this in mind, partner companies


known as aggregators provide the critical elements that enable
participating companies to make the best selection and optimise returns.
Aggregators take a central role in this new power-balancing arena. In
essence, they act as intermediaries between the Grid operators and large
energy users.They create a virtual power plant where the assets of
hundreds of companies are aggregated. This provides a grid-balancing
mechanism helps the system operators to deliver on their vision for a
more sustainable, flexible power infrastructure.
All of this combines to help National Grid (UK) and EirGrid (Ireland)
to minimise the operational costs of making the grid smart because
the aggregators deliver a technical solution to the challenge of grid
balancing.

Essential partnership

From the point of view of the end user, an aggregator such as Endeco
Technologies - is an essential partner for any feed or grain mill that
wishes to take advantage of the long-term lucrative opportunities. They
take care of the necessary hardware and software installation, as well as
the online monitoring and reaction systems, and the day-to-day running
of the system.
All of this is offered without any capex requirement, with the
aggregator instead taking a percentage of the scheme pay-out. As a point
of note, the aforementioned sum per megawatt is the amount payable
after the aggregator has taken payment.
Participating companies are in prime position to benefit from this
offer. In this first instance, energy consumption is reduced on selected
equipment after an audit of the plant, before energy strategies to reduce
cost are adapted and agreed with the plants operations team.
The chosen aggregator will connect the manufacturers principal
assets to its proprietary on-site optimisation platform, which enables the
automated control of energy consumption via wirelesssmart sensors and
actuators. One part of the aggregators job is to ensure mills are ready
and able to turn down their energy use when the grid operators require
it, and check that the response works correctly. Facilities employing an
aggregator simply relax and concentrate on day-to-day business.

Aggregate to accumulate

The answer to the question of which aggregator is best depends on


many factors. However, companies should be mindful to only work with
one that has a solid portfolio of successful existing sites under its belt.
A further vital factor is to choose an aggregator, such as Endeco
Technologies that offers a technology platform that can future-proof
against better schemes being introduced.
Response schemes are always likely to change over time and plants
participating in the scheme must be technology-ready to access more
financially attractive tariffs.
Ultimately, DSR schemes represent a no-risk route to generous
additional income for mills willing to help the UK better manage its
challenging electricity requirements.
54 | October 2016 - Milling and Grain

HOW TO EARN MONEY FROM YOUR


ENERGY-USING ASSETS
IDENTIFY:

An approved National Grid or EirGrid


aggregator will assess your available assets and calculate
revenue potential:
In flourmills, assets are likely to include: roller mills, purifiers,
sifters, fans and conditioning kit.
In animal feed mills, assets may include: pellet presses, steam
boilers, grinders and fans.

DEFINE:

Your aggregator will work with you to establish


parameters for response (including generator / battery backup), define constraints and operational priorities. This ensures
that there will be no impact on your operations and processes
as a result of turn-down.

IMPLEMENTATION:

Your aggregator will install and


configure its technology platform to connect your energy
intensive assets with no capital outlay *.

RESPOND:

Once youre connected, youre ready to


respond when required, without risk or impact on your
productivity.

EARN:

You start receiving monthly payments from the Grid


Operators within one month.
*Endeco Technologies doesnt ask for any capital outlay
for the implementation of the technology platform. Other
aggregators might take a different approach.
More information:
www.endeco-technologies.com

Or drop us line:
sales@endeco-technologies.com
callback@endeco-technologies.com

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