With greater electrification seen as a key enabler on the path to Net Zero, Distribution Network Operators (DNOs), are seeking new ways to release electricity network capacity to accommodate low carbon technologies rapidly. Baringa has been working with the Energy Networks Association (ENA) to develop a Common Evaluation Methodology (CEM). This will harmonise the way DNOs assess the benefits of procuring flexibility services when planning and managing their networks.
One of the concerns raised during the CEM’s consultation phase was that the ‘option value’ associated with flexibility might not be taken into account. The option value of flexibility will become increasingly important as new sources of demand, storage and generation connect to the distribution network, and load growth become more uncertain. This report describes how the CEM can be used by DNOs to estimate the option value of flexibility, and explains why this method is well-suited to the scenario-based network planning approach taken by DNOs.