The ENA Future Networks Forum holds regular innovation forums. The most recent over 17 and 18 April was very flex-y.
Day 1 included Rewiring Aotearoa (a FlexForum member) giving its view on the future of networks, the Electricity Authority discussing its DSO roadmap, and Blackcurrant (another FlexForum member) talking about its FarmFlex product.
Day 2 included FlexForum asking the FNF what burning pricing questions they had, and, the highlight of the 2 days a Horizon, Powerco and Orion (the latter 2 also FlexForum members) sharing details of flex and flex adjacent learning they have underway.
Here are some observations from the two days…
Some controversy to start with. There is no capex bias… The Commerce Commission is very clear that the financial incentives for opex and capex are equivalent and distributors face no financial benefit or disadvantage by choosing one over the other.
But, and this is a big BUT, the discussion highlighted that capex bias remains a thing and capex continues to be preferred in asset management decisions. Reasons for this were given, including very few people understand how IRIS actually works, cultural factors such as familiarity, certainty and confidence, and risk aversion.
What this suggests is that the neutral financial treatment of capex and opex incentives is not countering non-financial factors which create a continued preference for capex. Understanding what is going on is worth exploring further.
Learning is difficult, time consuming and rarely sufficiently resourced. Most flex learning occurs alongside a day job, involves capabilities not always held within the distributor, and the pace of progress often depends on external resources (with budgets competing with other business priorities).
Orion has valuable results on learning about the value of flex, customer participation and making flex BAU. We will be putting updates in the Knowledge Hub soon. In the meantime, check out all the details about Resi-Flex.
The questions and discussion prompted by Orion sharing its experience included:
Powerco described its development of a comprehensive demand forecasting model including granular spatial and temporal data for each connection, plus two-way power flows.
Forecasting is very obscure and technical, but very important for developing a smart flexible power system. This learning will help tick off Flex Plan step #31 to ‘Develop a minimum set of forecasting requirements and capability to support integration of flexible resources into distribution networks and the system.’
An insight shared with the room was the need to develop a shared set of forecasting assumptions regarding price response, flex resource uptake and when and how often people might say yes to flex.
The two days highlighted the extensive practical learning being delivered by distributors across the land which is not always visible to the wider ecosystem, nor the value recognised because it is about changing settings deep in the machine.
FlexForum will be shining its spotlight on these activities – and those across the ecosystem – to help join the dots and provide accurate indication of flex progress.
Interested in how flex is evolving across the sector? Get in touch to continue the conversation.
