Smart Systems and Flexibility Plan (2021): What it means for Smart Local Energy Systems

The Department of Business, Energy and Industrial Strategy (BEIS) and Ofgem published the Smart Systems and Flexibility Plan 2021 (SSFP) in July 2021, along with a flurry of major consultations and strategies, which built upon the initial SSFP in 2017 and ‘Progress Update’ in 2018.

BEIS and Ofgem state that the SSFP “sets out a vision, analysis and work programme for delivering a smart and flexible electricity system that will underpin our energy security and the transition to Net Zero”, with each chapter of the report setting out a vision and a series of actions. The chapters focus on:

  • Facilitating flexibility from consumers (smart buildings, electric vehicles (EVs) and SLES)
  • Removing barriers to flexibility (electricity storage and interconnection)
  • Reforming markets to reward flexibility
  • Digitalising the system
  • Delivering the Plan (including monitoring flexibility)

This insight paper explores what the SSFP means for Smart Local Energy Systems (SLES). SLES aim to integrate elements of the energy system including power, heat, transport and mobility, to develop effective pathways to decarbonisation based on the characteristics and needs of a local area. They serve a wide range of end users including industry, commercial, domestic consumers and public organisations, such as hospitals, libraries, and leisure centres.

By considering the needs of these potential users, SLES can improve the access and affordability of low carbon energy through novel business models and service offerings to encourage the uptake of technologies needed for the UK to meet its net zero target.

Energy Systems Catapult’s Energy Revolution Integration Service (ERIS) team are building a Net Zero Toolkit to help Local Authorities turn their net zero ambitions into actionable plans, unlocking the social and economic benefits SLES business models can deliver to their communities.

What is a Smart Local Energy System?

A Smart Local Energy System (SLES) is a way to bring together different energy assets in a local area and make them operate in a smarter way. They could be connected physically (e.g. a solar farm powering a housing development) or digitally (e.g. a virtual energy marketplace). They will help a local area decarbonise more quickly and cost effectively, and can deliver wider social and economic value for communities.

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Key points

This insight paper highlights the SSFP’s insights and actions that can impact SLES. Key point include:

  • Understanding the importance of flexibility, and the need to move quickly
  • Explicit recognition of the importance of SLES
  • Reforms to improve functioning of electricity markets and quality of price signals
  • Reforms to procurement processes led by Government, ESO and DNOs to better reward flexibility
  • Incorporating flexible/smart technologies into other policies, strategies, and legislation
  • Facilitating flexibility from consumers
  • Importance of storage for the future energy system
  • Carbon monitoring and reporting
  • “Market monitoring” approach to track progress
  • Consultations/Calls for Evidence to look out for.

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Smart Systems and Flexibility Plan (2021): What it means for Smart Local Energy Systems

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We empower and advise Local Authorities, Network Operators, and Central & Devolved Governments to take Net Zero action… mobilising the plans, projects, processes and partners you need to decarbonise local areas

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