Arenko optimises first co-located battery on a wind farm in the UK

Arenko optimises first co-located battery on a wind farm in the UK

Arenko, a leading software platform provider to the energy market, is pleased to announce that it has entered live operations with Vattenfall’s 22MW / 16 MWh battery, which is co-located at the 228MW Pen y Cymoedd Wind Farm in South Wales, following the completion of its Enhanced Frequency Response (“EFR”) contract in February 2022.

The site is the first battery storage facility in the UK to be co-located at a wind farm site, allowing it to benefit from using the existing wind farm grid export connection. It consists of 500 BMW i3 automotive battery packs housed in five shipping containers and was one of the eight projects selected by National Grid to provide the EFR until February 2022.

Arenko is the first company to optimise a storage asset co-located with a wind farm in the UK. Arenko has repurposed the asset to be optimised into wholesale, day-ahead and intraday markets.  Arenko is using its cloud-based optimisation software, Nimbus, to forecast market conditions, perform millions of simulations per day to optimise trading decisions across markets, and then securely and autonomously dispatch stored energy from the asset. This complete solution results in increased return on investment  for asset owners and streamlined portfolio growth for flexible assets on an energy grid in which decisions have to be made with ever- increasing speed.

Arenko aims to be the market leader providing complete end-to-end trade optimisation and automated dispatch software to maximise returns on co-located assets. Arenko’s technology continues to aid its customers by enabling the flexibility required to support the global transition to a zero-carbon grid.

Rupert Newland, Founder and CEO of Arenko Group, said:

“We are delighted to start delivering on our contract with Vattenfall, one of Europe’s leading energy groups. It’s been a great opportunity to demonstrate the efficacy and power of our technology on a co-located asset.”

Jake Dunn, Commercial Manager at Vattenfall, said:

“At Vattenfall, our goal is to enable fossil fuel free living within one generation. We are determined to help this energy transition not just through renewable generation but also supporting grid stability through co located battery storage projects. Now the EFR contract has come to an end, the battery will move to a more diverse range of ancillary services and we are grateful to be assisted in this by the market leading expertise of Arenko.”

Arenko, a leading software platform provider to the global energy market, and Gresham House Energy Storage Fund (LSE: GRID), the UK’s leading energy storage fund are pleased to announce that they have expanded their partnership. The continuation and expansion of this multi-year relationship is evidence of the parties’ strong working relationship and their shared commitment to decarbonisation and innovation in the energy sector.

Highlights:

  • Arenko has been awarded contracts to carry out asset optimisation on an additional five utility scale batteries for GRID. The contracts, totalling 210MW, are expected to come into force during 2022
  • GRID has also renewed the Byers Brae 30MW battery contract which Arenko has been optimising since March 2021
  • An additional framework agreement to optimise a further 215MW has also been agreed
  • When combined with previous announcements, Arenko will have been awarded contracts for the asset optimisation of over 500MW of GRID’s market-leading energy storage portfolio

These substantially build on the relationship between Arenko and GRID, having started working together in 2020 following the Fund’s acquisition of the 41MW Bloxwich energy storage project, which Arenko continues to optimise today.

Under these agreements, Arenko will use its proprietary end-to-end trade optimisation and automated dispatch software to maximise returns from these assets.

Rupert Newland, Founder and CEO of Arenko Group, said:

“Arenko is proud to count Gresham House Energy Storage Fund, which owns and operates the largest portfolio of energy storage in the UK, among its clients which include multiple listed energy firms and specialist energy storage funds. This framework agreement exemplifies Arenko’s strong desire to build lasting relationships with top tier investors and businesses.

“Gresham House Energy Storage Fund have done a fantastic job scaling their impressive battery portfolio and we are delighted to be entrusted to maximise profit and keep pace with the rapidly decarbonising UK electricity market. This is a further endorsement of Arenko’s ability to deliver superior returns for asset owners globally utilising our leading AI-driven software platform. We look forward to delivering on these projects and many more as the zero-carbon future continues apace.”

Ben Guest, Fund Manager, Gresham House Energy Storage Fund PLC (GRID), said:

“We are very pleased to have reached this agreement with Arenko. Arenko are among the leading asset optimisation services providers in the UK, and, increasingly, internationally. We have been impressed by their dedication to the emerging energy storage asset class through their significant investment into asset optimisation agreements (known as Automation and Digitalisation Agreements) their organisation and trading platform in recent years. This differentiates Arenko and is reflected in consistent trading performance and an ability to react to market changes as they happen.

“Gresham House Energy Storage Fund is committed to achieving excellence in all areas of its business, including the maximisation of its potential revenues and this overall agreement is an important part of this effort.”

Arenko, a leading software platform provider to the global energy asset automation market, is pleased to announce the appointment of Eddie Siow as Chief Financial Officer.

Eddie brings over 17 years’ experience working in a variety of senior and board roles in the energy and financial sectors, with an established track record in operational and corporate finance, M&A and capital raising, and managing and growing energy transition businesses. He joins Arenko from ENGIE, the global energy and services company, where he held the position of Finance Director of ENGIE Futures, a £150m revenue UK portfolio of heat networks, electric vehicle charging, and distributed and renewable generation businesses. At ENGIE, he also was a board member for its UK onshore wind and solar assets, and helped develop greenfield investment opportunities.

Prior to ENGIE, Eddie was a director in the investment bank at Barclays, where he led and executed M&A and capital raising transactions in public and private markets focusing on power, utilities, renewable energy, regulated networks, and infrastructure. Previously, Eddie also worked in investment banking at Lehman Brothers and Nomura.

Eddie holds a Master of Studies in Sustainability Leadership (MSt) from the University of Cambridge, and a Bachelor of Commerce (Finance) and Bachelor of Laws (BCom LLB) from the University of New South Wales. Eddie qualified as a Chartered Accountant with Ernst & Young in London.

Rupert Newland, Founder and CEO of Arenko Group, said:

“We are delighted to welcome Eddie as CFO to the Arenko team. Eddie’s significant financial experience and deep sector expertise in grid scale and distributed renewable energy will greatly enhance our management team. Eddie will provide the financial expertise necessary to enable Arenko to facilitate a global transition to a zero-carbon future.”

Eddie Siow, CFO of Arenko Group, said:

“I am passionate about the role of capital in delivering the energy transition to achieve Net Zero. I look forward to joining the Arenko team and contributing to its next phase of growth as we work towards creating a zero-carbon grid.”

Arenko, a leading software platform provider to the global energy asset automation market, is pleased to announce it has signed an agreement with Foresight Group (“Foresight”), a leading infrastructure investment manager, to optimise the 50MW Sandridge energy storage asset owned by funds managed by Foresight, which is due to be operational in 2022.

Arenko will use complete end-to-end trade optimisation and automated dispatch software to maximise returns from the asset. Arenko’s cloud-based optimisation software forecasts market conditions, performs millions of simulations per day to optimise trading decisions across markets, and then securely dispatches stored energy from the assets. This complete solution results in increased return on investment (“ROI”) for asset owners and streamlined portfolio growth for flexible assets on an energy grid in which decisions have to be made with ever-increasing speed.

This is yet another step in Arenko’s technology enabling a global transition to a zero-carbon future as it aids its customers by enabling the flexibility required for the UK to run purely on zero-carbon electricity by 2025.

Rupert Newland, Founder and CEO of Arenko Group, said:

“We are pleased to have signed another major contract with a leading infrastructure investment manager in Foresight Group. Arenko will be utilising its software to deliver improved returns from the 50MW Sandridge energy storage asset. We look forward to delivering this service for our client.”

Fuad Yusibov, Investment Manager, Foresight Group, said:

“We are pleased to be optimising the Sandridge storage asset together with Arenko. We have been very impressed with Arenko’s track record, technical capabilities, and commercial proactivity. We are looking forward to generating returns for our investors and contributing to net-zero transition through various current and potential future services and markets by leveraging Arenko’s expertise.”

Arenko, a leading software platform provider to the global energy asset automation market, is pleased to announce the signing of a new software licence agreement with a listed energy infrastructure company.

The customer will use Arenko’s complete end-to-end trade optimisation and automated dispatch software on its UK trading desk. Arenko’s cloud-based optimisation software forecasts market conditions, performs millions of simulations per day to optimise trading decisions across markets, and then securely dispatches zero-carbon energy assets. This complete solution results in increased ROI for asset owners and streamlined portfolio growth for flexible assets on a grid in which decisions must be made with ever-increasing speed.

This customer is the first software licensee to benefit from Arenko’s deep technical expertise and commitment to accessing new markets quickly and seamlessly, on which Arenko built its reputation. The partnership will see Arenko optimising a growing portfolio of the customer’s batteries over the next two years.

Arenko looks forward to growing the partnership as its customer executes on its impressive development pipeline.

This is yet another step in Arenko helping to enable a global transition to a zero-carbon future.

Rupert Newland, Founder and CEO of Arenko Group, said:

“We are delighted to sign this major software deal which opens up the global software market for Arenko. Our technology is enabling the flexibility required for energy companies to access and deliver all of the capabilities of their flexible assets. We look forward to delivering this contract and many others as the software partner of choice for asset owners and operators who are supporting the transition to a zero carbon grid.”

Arenko, a leading software platform provider to the global energy investor market, is pleased to announce it has signed a trading optimisation services agreement with Vattenfall, the leading European energy company.

Vattenfall’s 22MW / 16 MWh battery is co-located at the 228MW Pen y Cymoedd Wind Farm in South Wales. It was the first battery storage in the UK to be co located at a wind farm site, allowing it to benefit from using the existing wind farm grid export connection. It consists of 500 BMW i3 automotive battery packs housed in five shipping containers and was one of the eight projects selected by National Grid to provide Enhanced Frequency Response (“EFR”) until February 2022.

With the signing of this new contract, Arenko will use complete end-to-end trade optimisation and automated dispatch software to maximise returns from February 2022 onwards. Arenko’s cloud-based optimisation software forecasts market conditions, performs millions of simulations per day to optimise trading decisions across markets, and then securely dispatches stored energy from the assets. This complete solution results in increased return on investment (“ROI”) for asset owners and streamlined portfolio growth for flexible assets on an energy grid in which decisions have to be made with ever- increasing speed.

This contract builds upon recent contract wins as Arenko’s technology aids its customers by enabling the flexibility required to support the global transition to a zero-carbon future. Arenko was pleased to work closely with Jake Dunn, Commercial Manager at Vattenfall who pioneered the development of renewables co location in the UK, to finalise this agreement.

Rupert Newland, Founder and CEO of Arenko Group, said:

“We are delighted to have signed this contract with Vattenfall, one of Europe’s leading energy companies. Arenko will be utilising our best-in-class asset optimisation services to enhance the returns from the battery asset in South Wales. This is an exciting opportunity for Arenko, and we look forward to delivering on the contract for Vattenfall and for other asset owners going forward.”

Jake Dunn, Commercial Manager at Vattenfall, said:

“At Vattenfall, our goal is to enable fossil fuel free living within one generation. We are determined to help this energy transition not just through renewable generation but also supporting grid stability through co located battery storage projects. As the EFR contract comes to an end and the battery moves to a more diverse range of ancillary services, we are grateful to be assisted in this by the market leading expertise of Arenko.”

Arenko Group is pleased to announce its Chief Product Officer, Andy Hadland, has been selected as a member of National Grid ESO’s Technology Advisory Council (“TAC”). The TAC was formed to guide ESO on its digital, data and technological transformation. The group will work closely with ESO on the development of new systems, ensuring that ESO works with the industry and gives transparency and accountability for all development.

Andy has been chosen for his expertise in technology and transformation, in recognition of his role in creating Arenko’s world leading AI platform and his contribution as a guest lecturer at Imperial College Energy Futures Lab.

Andy Hadland, Chief Product Officer, said:

“I am hugely excited to be part of such a diverse group of sector-leading experts. The TAC will play an important role guiding ESO on its transformation to deliver a cleaner energy system.

“My involvement in the TAC is another example of Arenko’s continued support for National Grid and our commitment to creating a greener future for the UK.”

A full list of members of the ESO Technology Advisory Council can be found here:

https://www.nationalgrideso.com/who-we-are/stakeholder-groups/technology-advisory-council

Arenko first provider to successfully offer non-Balancing Mechanism Units (“BMU”) Real Time Monitoring (“RTM”) for Dynamic Containment

Stacking Balancing Mechanism, Dynamic Containment and wholesale power offers immediate revenue uplift

Arenko, a leading software platform provider to the global energy asset automation market, is pleased to provide an update on its Dynamic Containment service provision. Arenko is providing this service to National Grid ESO with 51MW batteries owned by Gresham House Energy Storage Fund and Gore Street Energy Storage Fund, the two leading listed energy storage funds in the UK and has been involved in the service since its launch in October 2020.

Arenko first provider to successfully qualify for Non-BMU Real Time Monitoring

Out of a total 405MW of battery assets delivering Dynamic Containment, there are currently 207MW across 15 batteries delivering the service which are not registered as Balancing Mechanism Units (“Non-BMU”). From 1 April 2021, these assets need to qualify for Real Time Monitoring (“RTM”) or they will be ineligible to continue delivering Dynamic Containment to National Grid ESO.

Arenko has become the first provider to qualify a Non-BMU RTM battery, by successfully completing the process at Gore Street’s Lower Road 10MW battery. The process includes setting up high resolution operational metering and accurate, automated communication channels with National Grid ESO in order to pass complex Conformance Testing. This process was completed on 9 February 2021.

Arenko’s RTM solution is fully transferable onto any of our customer’s batteries. Arenko have a strong track record in rapidly onboarding new customers into dynamic containment as evidenced by our recent integration at Lower Road battery system where Arenko took one working week from attending site to passing the Independent Technical Expert certification to deliver that system into Dynamic Containment.

Stacking Dynamic Containment with Balancing Mechanism and wholesale power offers immediate revenue uplift of 3%

Arenko was the first group to offer our customers Balancing Mechanism and Dynamic Containment stacking when this was permitted by National Grid ESO on 27 January 2021. National Grid ESO have allowed batteries to rebalance their state of charge in the Balancing Mechanism rather than on the open market. This is a first step to offering full two-way stacking and allows batteries to help balance supply and demand in the grid, whilst at the same time, maintain the strength of the system by helping to manage the frequency.

Arenko’s algorithmic, fully automated software has been successfully three way stacking Dynamic Containment with Balance Mechanism and wholesale power rebalancing in real time without impacting the integrity of any service. This includes charging the battery when power prices have been negative.

This has reduced the cost of delivering dynamic containment from £0.69 per MW per hour to £0.17 per MW per hour. The £0.52 per MW per hour saving represents a 75% reduction in cost and an overall revenue uplift of 3%, which our customers benefit from. We expect a 3% to be sustained going forward which will be supplemented further through new stacking strategies which are currently in development.

Rupert Newland, Founder and CEO of Arenko Group, said:

“We are delighted to be the first to offer non-BMU Real Time Monitoring and Stacking to our customers. Our flexible software solution enables us to quickly respond to market changes so that we can rapidly offer new features to our customers and our automation technology allows us to deliver best in class performance. Today’s announcement is yet another example of Arenko’s consistent track record on being the first entrant to new markets and of how software and automation can contribute towards a cleaner, greener future.”

£195m potential annual savings available for end consumers by using batteries
Unlocks pathway to a zero-carbon electricity grid in 2025
National Grid ESO confirms ambition to procure Reserve from batteries going forward

Arenko, a leading software platform provider to the global energy asset automation market, is pleased to announce the highly successful results of the Reserve from Storage trial which it pioneered throughout Summer 2020 with National Grid ESO. Having originally proposed the service to National Grid ESO, Arenko designed it in collaboration with National Grid ESO, optimising 41MW of batteries in all three trials.

Highlights

  • Batteries can effectively provide sustained Reserve allowing competition with other market participants to meet energy imbalances and driving cost efficiencies for the end consumer
  • Providing Reserve from batteries will deliver increased operational resilience and support National Grid ESO’s wider ambitions of operating carbon free by 2025
  • £0.7m saving to the consumer realised by using batteries participating in the trial versus the alternative solutions throughout the 20-day trial in Q3 2020. Using a linear scaling, which may not fully capture the true value for the consumer, a potential annual saving of £195m could be realised if current demand for Reserve was met using batteries
  • Consumers made a 40% saving by using batteries to provide Reserve compared to business as usual
  • Batteries were cost effective and represented value in 80% of all settlement periods (half hour periods) during the trial
  • Over the course of the trial, steady value to the consumer was realised at all times throughout the day demonstrating value in a range of market and operational conditions

National Grid ESO confirms ambition to procure Reserve from batteries going forward.

A copy of National Grid ESO’s report can be found here

What is Reserve

Electricity demand and supply has to be kept in perfect balance on a second by second basis to ensure grid stability. While increasing renewable energy generation is essential for progressing towards net- zero, this makes power generation harder to forecast and match to demand, given the natural intermittency of wind and solar power. To deal with this, we need to hold ‘reserve’, akin to a substitutes bench to balance the grid when there is too much or too little power in the system.

Currently in the UK we get a lot of our ‘reserve’ from fossil fuelled plants. They have to be paid to switch on for 4-6 hours at a time, at part load, so that they can turn up or down rapidly to provide reserve as needed. If the UK is to transition to a net-zero future, this is unsustainable. It is the equivalent of leaving the engine running on your car all the time, just in case you need it. This is why Arenko proposed trialling the use of its battery technology to National Grid.

Rather than National Grid taking its ‘reserve’ from fossil fuelled plants, the trials have been running using ‘reserve’ from batteries instead. The great advantage is that batteries do not need to be generating power to provide reserve, unlike fossil fuelled plants, and so there is no need to switch off renewable generators such as wind farms to bring carbon emitting fossil fuel plants onto the system at part load. Throughout the trial, batteries charged up with large proportions of wind and solar power were able to provide ‘reserve’ cheaper than securing reserve from fossil fuelled plants.

Win-win-win

Arenko believes that procuring Reserve from batteries presents a unique win-win-win once the service is scaled for commercial use: The consumer benefits from c.£195m of annual savings on today’s business as usual; a pathway to mass deployment of renewables leading to a zero carbon electricity grid is made possible; battery owners can generate an attractive investment return in a major new market to support the required scale up of batteries.

This is an exportable, UK born solution to a global problem of how to transition to a low carbon future. It’s not a silver bullet but it’s part of a suite of services that are crucial to transitioning to economic, secure and sustainable energy systems across the globe.

Rupert Newland, Chief Executive, said:

“Arenko are delighted to have worked with National Grid to develop and deliver this important trial, whose results have huge global significance for the battery industry. The trial provides irrefutable evidence that new battery technologies, operated using intelligent software, can transform the management of the electricity grid to enable the mass deployment of renewable energy, a zero-carbon electricity system and the realisation of huge savings for the consumer.”

Detailed outlook and performance summary

A deep new market for storage

National Grid ESO’s System Operability Plan (“SOP”) indicated an ongoing requirement of up to 2GW of Reserve, which has historically been procured from traditional thermal power plants and CCGTs. If this requirement were to be satisfied from batteries, the evidence from this trial substantiates that consumers would benefit from annual savings of c.£195m if the savings announced following the trial are linearly scaled over the course of a year.

Demand for electricity dramatically dropped as a result of lockdown restrictions from COVID which substantially increased the proportion of renewables such as wind and solar on the system. Arenko’s analysis suggests this drove up the requirement for National Grid ESO to procure Reserve to c.5GW, representing a view of the future electricity grid’s needs in a high renewable penetration environment.

Over the next ten years, National Grid (Future Energy Scenarios) expects installed capacity of renewables to rise from 40GW today to between 70-104GW in 2030 (onshore and offshore wind component represents a 2.1-3.0x increase in capacity).  At the same time, fossil fuels generation capacity will drop from 49GW today to 24-40GW. This is likely to drive the requirement for Reserve considerably higher than it is today.

Over the same timescale, National Grid forecasts batteries to grow from c.1GW today to up to 9GW, in order to balance the increasing intermittency of renewables. As evidenced by the trial each new MW installed can offer an annual saving to the consumer of £97.6k per annum (£11.14 per MW per hour) which represents a 40% saving versus alternative sources of reserve.

The challenges faced by National Grid ESO in balancing the system and having sufficient Reserve capacity to call on are faced by all international system operators and there is significant potential for this model to be exported to different markets.

Arenko advantage – Arenko’s proprietary automation software presents superior performance versus other providers

 110MW of batteries participated across the full trial and a further 49MW joined for the final week. Participants involved for the duration of the trial received an average £16.78 per MW per hour in Reserve, a 40% saving for the end consumer versus alternative sources of Reserve.

All trading activities throughout the period are publicly available through Elexon, and the relative performance of the different operators can be assessed using that data.

Using its proprietary automation technology, Arenko was able to operate in and seamlessly transition between reserve, balancing mechanism and European Power Exchange (EPEX) markets to deliver the highest value service when it was most needed. This generated net revenue of £14.59 per MW per hour across all periods for the duration of the trial (over 10% higher than any other provider participating in the trial). Annualised this represents a £128k per MW per annum net revenue for batteries owners, which underpins this service as an extremely attractive investment proposition for Arenko’s customers.

Arenko’s proprietary software was able to deliver a fully automated response to 96% of instructions (versus 84% and 75% for other batteries).

A summary of the batteries participating for the duration of the trial can be found below:

ARENKO POWERED BATTERY OTHER BATTERY 1 OTHER BATTERY 2
Size 41MW/41MWh 49MW/49MWh 20MW/20MWh
Annualised net revenue per MW £128k £116k £111k
Total revenue (£/MW/hr) £14.59 £13.19 £12.63
Average reserve revenue (£/MW/hr) £18.27 £15.97 £15.74
Average trading income when not providing Reserve (£/MW/hr) £6.22 £2.95 £3.35
Time in Reserve 69% 79% 75%
Instructions delivered 96% 84% 75%

 

Outlook

Arenko believes it is a commercial and environmental imperative that following these successful results by National Grid ESO that this service is rapidly scaled up to realise its full benefits for consumers and the system stability.

Arenko is calling for:

  • A level playing field for all technology classes, including batteries, CCGT, thermal generators and any other technologies capable of delivering Reserve, where it is procured in economic merit order to drive fair competition
  • Existing market mechanisms, as used in the trial, are used to rapidly procure the service so that battery operators can provide this service and consumers realise the value

Arenko looks forward to offering this service to our customers on an ongoing basis.

Arenko, a leading software platform provider to the global energy asset automation market, is pleased to announce the signing of a new contract with Gore Street Energy Storage Fund (“Gore Street”) and the commencement of services to the electric grid. Arenko was selected by Gore Street to provide its market-leading automation platform as a route-to-market for an operational 10MW energy storage project because of its track record of breaking ground in fast-changing energy markets. Gore Street is a leading and innovative listed energy storage investor.

Arenko was chosen by Gore Street to implement its AI-driven, automated software platform to optimise and transact the battery asset, significantly enhancing the asset’s financial and technical performance. Arenko implemented its solution with validation from an independent technical expert in under a week, enabling Gore Street to maximise the value of the asset immediately. This contract with Gore Street is further evidence of Arenko’s strategic shift to being the software partner of choice for battery and renewables owners globally.

With this partnership, Arenko manages 51MW of operational assets with a further 100MW contracted and scheduled to come online over the next 18 months. Arenko believes digitally connected, highly-automated battery storage assets are an essential part of the energy transition story, helping provide instantaneous power and frequency support to the grid. The COVID-19 pandemic has increased the speed of the reshaping of the UK power network, resulting in renewable power now meeting up to 60% of daily demand and highlighting the essential role that will be played by battery storage and other flexible assets in the net zero grid of the future. Arenko’s software platform is designed to maximise the availability and profitability of energy assets and will help accelerate the transition towards a fully decarbonised power system.

Rupert Newland, Founder and CEO of Arenko Group, said:

“We are pleased to have signed the contract with Gore Street Energy Storage Fund, a leading energy storage fund. The project will see Arenko deliver technical software from its leading, AI-driven, automated software platform. We look forward to working with Gore Street and other forward-thinking asset owners to help them maximise the value of their assets in the future.”

Alex O’Cinneide, CEO of Gore Street Capital Limited, the investment manager of Gore Street Energy Storage Fund, added:

“We are delighted to announce Gore Street’s partnership with Arenko to implement their AI-driven automated software platform on one of our 10MW assets within our significant portfolio of energy storage projects. Further international investment in energy storage will be critical for meeting global renewable energy investment goals and we look forward to working closely with Arenko to maximise the efficiency of an important asset.”

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