Connecting your business to the smart grid:

for revenue
for reliability
for the environment
 Flexitricity brings new revenue and increased asset reliability to UK businesses,
while reducing carbon emissions and risk in the national electricity system.

Flexitricity uses Britain's most advanced smart grid system to unlock the hidden
flexibility of commercial energy users and small generators.

With Flexitricity, energy users are earning revenue now, by helping secure
electricity supplies and supporting the renewable energy revolution.

1 Demand on the national
electricity supply
sometime pushes the
system towards capacity.
2 Short Term Operating Reserve (STOR) is 4 Electricity provided by Flexitricity’s
used to provide extra electricity for
short periods.
National Grid calls on
Flexitricity’s smart grid
to contribute electricity
into STOR.
5 With Flexitricity’s
smart grid keeps the electricity smart grid available
system stable through the peak. to National Grid,
fewer coal power
stations have to be
kept on hot standby.

3 Flexitricity’s rapid
6 delivery of energy
can be used to
balance fluctuations
in renewable energy
generation.
This data centre has
temporarily opted out of
the Flexitricity smart grid in This factory has automatically
order to carry out essential delayed a non-critical process
maintenance. to reduce electricity demand.

This facility has automatically

taken itself off-grid using its
own standby generators.

This supermarket has

automatically turned off non-
essential air-conditioning systems
to reduce electricity demand.
This cold storage facility has
temporarily turned off its
refrigeration systems – which
won’t affect stored produce.
This CHP generator has switched on
spare electricity generating capacity, This call centre is running its
and is sending excess heat to a standby generators, covering
thermal store. its own demand and
supplying excess into the
distribution networks.

How Flexitricity helps your
business
Most businesses are sitting on untapped
sources of revenue, in their standby
generators, electricity consuming
equipment, combined heat and power
(CHP) generators and hydro generators.
Flexitricity provides companies with
access to this revenue, which can
exceed £100,000 per annum on a single,
medium-sized industrial site.
Flexitricity’s smart grid communicates
directly with electricity generating and
consuming equipment on clients’ sites
via secure connections. This allows
Flexitricity to increase generation and
reduce consumption during short periods
of stress for National Grid – a valuable
service which helps stabilise electricity
supplies. The company’s patented
technology and continuous service
monitoring ensure that normal core
business operations have priority at all
times, while critical standby assets
become more reliable through regular
testing.
Flexitricity’s system works within the
client’s existing electricity purchase
arrangements and, in most cases, with
the equipment which is already on-site.
Full parallel STOR Standby generation Energy security
Combined heat & power Triad Flexible generation Smart grid
Load management Asset reliability
Renewables friendly New revenue
Why Flexitricity?
Energy partnering
Flexitricity Ltd created and now operates
the first, largest and most advanced
smart grid system in the UK – bringing
revenue to UK businesses, reducing
national CO2 emissions and helping to
secure energy supplies.
The company was established in 2004 to Short term parallel
develop new ways of addressing the
short term balancing requirements of the
national electricity system. Working with
an enviable blue-chip client base,
Flexitricity has become the country’s
market leader in aggregated demand
side management, winning awards for its Reduced carbon
team and technology along the way.
Flexitricity’s smart grid provides Short
Term Operating Reserve (STOR) – the
most important category of fast-acting
generation or demand-reduction capacity
– which is held ready for National Grid, to
keep the electricity system stable during
times of system stress. Flexitricity’s live,
operational service is available every day
to National Grid.
www.flexitricity.com 0845 223 5334
Working with Flexitricity delivers:

New revenue from existing assets: National Grid pays

Flexitricity to hold reserve available, and makes further
payments when this reserve electricity is required. Flexitricity
shares these payments with clients, who own the assets
Flexitricity uses. This turns assets which had previously been
cost items into direct revenue generators.

Improved asset reliability for your business: Standby

generators need to be run regularly ‘on load’ to ensure that they
are capable of providing reliable emergency power. Generators
which are only tested ‘off load’ have an unacceptably high
likelihood of failure when they are needed most. With Flexitricity,
all running is on load. All assets connected to Flexitricity’s smart
grid are monitored remotely and clients are informed
immediately of any on-site concerns.

Reduced CO2 emissions: Every megawatt of capacity

connected to Flexitricity’s smart grid is a megawatt that does not
have to be held in reserve elsewhere. This reduces the need to
keep coal and oil stations on hot standby or running inefficiently
at part load – this reduces emissions by between 300–700
tonnes of CO2 per annum, for each megawatt provided.

Wider adoption of renewable energy: Some types of

renewable technologies can only generate electricity when the
weather permits. Electricity supply and demand must be kept in
constant balance, so variations in renewable generation need to
be matched by turning other energy generators up and down, or
by altering demand. Flexitricity combines small, controllable
generators and flexible electricity loads, to create a low-carbon
source of balancing electricity to respond to variations in wind,
wave, tidal and solar generation.
Flexitricity’s smart grid
makes business greener
Environmental demands on business are
only going one way – up

UK carbon commitments might seem

ambitious now, but there’s much more to
come. Business energy users who are
smart about their electricity use and
generation are better placed to benefit
from the drive for ever higher energy and
fiscal efficiency. Working with Flexitricity
makes sense today and is a prudent
approach to the changes in energy policy
and economics which many are
predicting.

Flexitricity’s answer to a national

challenge
Electricity consumers don’t ask
permission every time they turn on a light.
Large power stations can fail suddenly
and wind turbines can only generate when
there’s wind. This means that National
Grid must always keep something in The Flexitricity smart grid
reserve to keep the electricity system in
Flexitricity monitors the status of clients’ equipment from its
perfect balance as both supply and
Edinburgh control room. If a national demand peak is higher
demand vary.
than expected, or if a large power station or interconnector
fails, Flexitricity receives an electronic instruction from
A large volume of reserve always comes
National Grid. Flexitricity’s smart grid system then
from part-loaded fossil fuelled power
communicates directly with clients’ equipment via a
stations, even though it is inefficient to
Flexitricity outstation located on each site, starting generation
burn gas and coal at part load. Additional
or turning down consumption within minutes. This delivers
reserve is provided by warming older coal
reserve energy to the system and gives National Grid time to
and oil power stations, which can take
put other measures in place.
twelve hours or more. Often, this reserve
is not needed in the event and the stations
On most sites, Flexitricity restricts delivery to a maximum of
are switched off without generating
130 minutes. All sites can ‘opt out’ manually or automatically
anything.
if they need to, and Flexitricity doesn’t attempt to use any
site where a problem has been detected.
It’s more efficient for electricity users and
small generators to provide some of the
flexibility that National Grid needs to
Corporate social responsibility
balance the system – this is where By working with Flexitricity, UK businesses can demonstrate
Flexitricity comes in. Standby or CHP to their stakeholders that they are using their assets in the
generators, or opportunities to reduce most cost-effective and environmentally beneficial manner.
load for a short period, don’t emit CO2 Flexitricity uses small generators and flexible electricity loads
when waiting to be called-upon, and to reduce both costs and carbon emissions for everyone.
Flexitricity’s smart grid can access them
extremely rapidly if needed.

www.flexitricity.com 0845 223 5334

Where does the revenue come from?
Short Term Operating Reserve
Short Term Operating Reserve (STOR)
is one of National Grid's most
important tools for securing the
national electricity system in real time.
Under the STOR arrangements,
National Grid pays a ‘rent’ (termed
availability) for STOR capacity, and
pays a usage charge (utilisation) when
the reserve is needed, such as during
demand peaks, or when large power
stations fail.
STOR is a year-round service,
potentially available to National Grid on
a 24 hour basis. For most of
Flexitricity’s client businesses relatively
low utilisation hours are targeted using
the STOR pricing strategy, so that the
bulk of the clients’ revenue is normally
earned from availability payments.
Availability is paid during key ‘windows’
set by National Grid. These windows
vary seasonally, but currently fall within
the period 07:00 to 22:30, and amount
to roughly 11 hours per day. Most
STOR utilisation occurs within these
windows.
The STOR market has been growing in
volume and value for several years, due
to the reduction of flexible coal and oil
electricity generation capacity, and the
increase in forms of generation which
require balancing, such as renewables.
Under typical terms (which can be
tailored) Flexitricity provides National
Grid with run times of up to two hours
per call, plus response time. Calls
typically last around one hour and
amount to approximately 50–60 hours
of running per year.
For standby diesel generators or gas-
fired CHP generators, STOR is the
largest incremental revenue
opportunity, with the lowest relative
impact on generator run hours, and the
lowest exposure to fuel price risk, of
any premium energy activity.
Triad management
The triad system is more familiar than
STOR to most energy managers and
energy purchasers. STOR and triad
management may be operated together
within certain constraints. Triads are a
method whereby the Transmission
Network Use of System (TNUoS)
charges are distributed between
electricity suppliers, who recover them
from electricity customers. These
charges are known as ‘triad charges’,
and should be shown explicitly on
electricity bills. Triad charges are
proportional to the client’s electricity
demand at the three highest national
system peaks in any winter (November
to February). These peak half-hour
periods are known as ‘triad periods’. If
clients reduce demand during these
peaks, they will reduce their triad
charges proportionally. Triad periods
are not known in advance, but can be
forecast, as they typically occur
between 4.30pm and 6.30pm on
weekdays during cold weather.

Flexitricity’s triad management strategy

involves careful targeting of generation
and demand reduction to the periods
which have a high likelihood of being
declared the triad periods for that year.
When a triad is considered likely,
consumption is reduced for up to two
hours. This generally occurs on 15–25
occasions per year. It is necessary to
opt out of STOR for selected winter
weekday evenings when triad
management is conducted. In most
locations, the benefits for operating
triad management outweigh the
reduction in STOR availability
payments. Flexitricity manages this
crucial interaction in order to maintain
quality of service and maximise
revenue.
Other services
Some sites are capable of providing
specialist services in addition to, or
instead of, STOR and triad management.
At the same time, new opportunities are
emerging to sell electricity balancing
services to distribution and energy retail
companies. Once Flexitricity is familiar
with a client’s organisation and sites, it
will identify those that could be of interest
to the client at the appropriate time.

www.flexitricity.com 0845 223 5334

Working with Flexitricity
There are six main phases when working with Flexitricity:
1. Appraisal
4. Settlement
1. Appraisal
Flexitricity conducts a detailed
appraisal of the client’s assets and
electricity consumption patterns. By
gathering technical data, performing
site visits and (where necessary)
speaking to the distribution network
operator, Flexitricity determines how
a client’s organisation can get the
most out of its energy consuming or
generating assets.
A well-informed business decision
is the goal of this process –
providing clients with the facts that
are needed to decide which sites
should progress. Challenges can
arise from electricity distribution
networks and with on-site logistics.
This is why the business benefit
must be quantified early in order to
maintain momentum.
2. Implementation
Getting the client’s equipment
connected and commissioned is
key to accessing new revenues. At
this stage, Flexitricity galvanises the
efforts of the client’s preferred
contractors, managerial staff, on-
site teams and third-party service
providers to navigate the
implementation stages. Flexitricity
also provides a customised
‘outstation’ for each site.
It is the momentum that results from
the appraisal stage that keeps
2. Implementation
5. Tender cycles
programmes on track. Flexitricity
has wide experience of the
challenges which arise during
implementation, and assists all
stakeholders in getting sites
connected to the Flexitricity smart
grid quickly.
3. Operations
Once a site is connected,
Flexitricity’s smart grid remotely
monitors the client’s equipment in
real time – checking the health of
generators and loads and
appraising the site’s capability to
provide reserve energy to National
Grid.
The system is fully automated –
Flexitricity’s smart grid control
centre is fully manned with
experienced engineers who are
available to deal with events,
exceptions or queries. Flexitricity
understands that core business
processes must always be
protected, so the system works only
within pre-agreed limits. The site
always retains ultimate control: the
client’s on-site team always has the
facility to withdraw the equipment
from the Flexitricity smart grid if
required.
4. Settlement
Every month, Flexitricity audits the
revenue received from National Grid
and pays the client. The majority of
3. Operations
6. Expansion
the revenue comes from availability
payments, paid for the capacity
connected regardless of the number
of times that it is actually used.
When National Grid calls for
generation to run or loads to turn
down, further revenue is generated.
5. Tender cycles
The market price for STOR has
consistently been substantially
higher than the cost of operating
energy generating or consuming
equipment, even without
considering the regular income
which is paid regardless of how
much equipment is run. Regular
tender rounds ensure that changes
in market conditions can be
incorporated into future prices.
Flexitricity conducts detailed market
analysis in advance of each tender
round to ensure that each asset
type achieves the best net return,
within the constraints of normal site
operations.
6. Expansion
Flexitricity constantly looks for new
ways to increase revenue to clients,
by developing new products and
systems. By working in partnership
with clients, Flexitricity ensures it is
in all parties’ interests to maximise
the revenue obtained by existing
sites, and widen the range of
equipment able to participate in the
Flexitricity smart grid.
Technical Information

Standby generation
Flexitricity’s approach to standby generators improves
reliability and turns “deadweight” assets into revenue
earners.

National Grid has a growing need for flexible generators that

can respond more quickly than large power stations, and
without long, fuel-hungry start and stop sequences. Standby
diesel generators are ideal for this role, and can earn
substantial revenue while helping to secure the national
electricity supply.

Flexitricity uses its smart-grid system to turn standby

generators around the UK into an aggregated, low-carbon
source of reserve electricity for National Grid. In return,
generator owners receive several benefits:
• New revenue is earned using existing assets;
• The majority of the revenue comes from availability
payments, paid regardless of the amount of running, and is
therefore predictable;
• STOR running is typically similar to a good-practice
generator test and exercise regime, and substitutes many
elements of it;
• The reliability of the site’s emergency power supply is
dramatically enhanced;
• Flexitricity remotely monitors key aspects of standby
generator health.

Running a generator for Flexitricity directly contributes to the

generating equipment’s reliability, as it ‘exercises’ the
generator under loaded conditions, and eliminates damaging
practices such as off-load testing. Connecting these assets to
Flexitricity’s smart grid can significantly reduce the risk that a
standby generator fails to deliver during a power cut.

Flexitricity’s system is fully automatic, so our clients’ staff don’t

have to spend time looking after it; Flexitricity operators
constantly monitor equipment whenever it is available to
National Grid. Flexitricity understands that core business
processes must always be protected, so in a power cut a
client’s generators will supply the site as they should.

www.flexitricity.com 0845 223 5334

Technical Information

Combined heat and power

(CHP) and small hydro
generators
New revenue sources for independent electricity
generators.

Flexitricity is not just for electricity users. The company’s

award-winning innovations for small power stations are
designed to increase revenue while still maximising annual
generation.

Most combined heat and power (CHP) and tri-generation

stations are heat-led, generating their electricity when heat (or
cooling) is needed. This means that the electricity is sold on a
spill basis, which lessens its value. Opportunities to provide
reserve electricity to National Grid are also missed.

However, many heating and cooling networks possess either

natural thermal inertia, or heat stores. Flexitricity uses this
storage to maximise the value of the CHP electricity, while still
providing the same amount of heat or cooling.

It is well known that hydro power stations can be the most

flexible generators of all. However, small hydro stations are
usually unable to participate in flexible markets or reserve
services, purely because of size.

Flexitricity’s smart grid aggregates small CHP and hydro

generators, giving them the first opportunity to realise the
value of their inherent flexibility. Flexitricity respect the process
limits of small generators, and ensures that opportunities to
generate are not missed.

Built into a business case at the start, Flexitricity’s approach

can increase the viable size of CHP or hydro station for a given
site.

As well as increasing the revenue to the generator, Flexitricity

also enhances the CO2 savings that embedded CHP and small
hydro power stations already provide.

www.flexitricity.com 0845 223 5334

Technical Information

Load management
Small changes to consumption make a big difference.

Industrial and commercial electricity consumers can now earn

substantial revenue by helping to keep the national electricity
system stable, while carrying on with normal business.

Many processes – such as air conditioning, pumping, chilling

and heating – have some kind of natural inertia or energy
storage. By working only with these processes and respecting
their normal operating limits, Flexitricity can reduce load for
short periods when the national electricity system is under
stress. The processes then ‘catch up’ consumption during a
period of lower stress, and thus lower carbon, in the national
electricity system.

Because Flexitricity aggregates these loads using its smart

grid, even relatively small units – down to individual pumps or
compressors – can participate.

Interacting with a client’s critical processes requires great care

in order to preserve reliability, customer service and
operational ‘up-time’. Flexitricity’s rules for load management
ensure that core business is not disrupted. These are:
• Isolate the flexible elements – Flexitricity’s smart grid never
works with electricity loads that can't be interrupted without
disruption.
• Stay within limits – every process has business-critical limits
which it must not breach. These may be temperatures, tank
or stock levels, or any other critical parameters. If these
limits are approached, the equipment automatically takes
itself out of the smart grid.
• Provide an opt-out – site operators need to retain ultimate
control over site equipment. Every site participating in
Flexitricity’s smart grid has a manual ‘inhibit’ control.
• Automate end-to-end – unless clients require direct day-to-
day involvement, operational staff don't have to do anything
once a site is connected to the Flexitricity smart grid.
• Monitor – whenever your load is available to be turned down
by National Grid, Flexitricity operators are monitoring it.

www.flexitricity.com 0845 223 5334

 Tel: 0845 223 5334 Fax: 0845 223 5417
Email: info@flexitricity com

© Copyright 2010 Flexitricity Limited. All rights reserved. Flexitricity and its associated logo are trademarks of Flexitricity Limited and are the subject of trademark applications or registrations
in various countries around the world. All other trademarks are the property of their respective owners. All Flexitricity products and services are subject to continuous development – we
therefore reserve the right to alter technical specifications without prior notice.

www.flexitricity.com 0845 223 5334