Balancing market opens to residential battery storage in Great Britain

Residential batteries can now trade in Great Britain’s Balancing Mechanism market, following a rule change announced by system operator NESO.

Balancing mechanism metering rules have been adjusted to relax accuracy, refresh rate, and latency requirements for trading units with capacity under 1 MW, making the market accessible to small-scale aggregated units, such as a fleet of residential batteries. Anyone with a battery, EV charger, or heat pump connected to Great Britain’s electricity grid will be able to benefit from the metering rule changes, according to NESO

The balancing mechanism is NESO’s main tool for balancing supply and demand on Great Britain’s electricity network. The system operator uses it to buy and procure the right amount of electricity to balance the system via a continuously open online auction. Thousands of balancing mechanism trades take place daily and each trading period is 30 minutes long.

Residential battery owners will be able to participate in this balancing market either by signing up through their energy supplier or a third-party aggregator.

A limited number of battery storage owners have already been able to provide some demand-side flexibility in Great Britain via the Demand Side Flexibility Service, but this typically involved procuring relatively small amounts of energy for the grid in advance and was only deployed a handful of times in a month. Balancing mechanism participation should mean a major increase in the opportunities for households and businesses to earn revenue or reduce bills by charging or discharging in line with electricity system needs.

The change follows an independent review and evidence-based trials with Octopus Energy, EV Energy, and Pod Point.

Martin McCluskey, the UK government’s minister for energy consumers, said the change will help more consumers to benefit from cost savings. “This is an important step towards a flexible, clean and innovative energy system, which puts consumers first,” he said.