New Balancing Reserve service goes live to reduce balancing costs and improve system security

Balancing services

14 Mar 2024 - 2 minute read

The first Balancing Reserve (BR) auction for day ahead capacity ran successfully on our Enduring Auction Capability (EAC) platform, also utilising the capabilities of our Single Markets Platform (SMP).

What are the EAC and SMP?

The EAC is our new platform which currently procures Dynamic Containment, Dynamic Regulation, and Dynamic Moderation Response Services. It allows market providers to access multiple markets at the same time, which makes the procurement of balancing services more efficient and allows us to select the option that offers the best value for consumers. We have now added BR as a service to be procured on the EAC, with Quick and Slow Reserve services to follow in the future. The EAC includes innovative features such as co-optimisation, stacking and an advanced clearing algorithm which enables us to procure services more efficiently.

Learn about the EAC

The SMP helps us become a better buyer of ancillary services by transforming user experience. The SMP provides frictionless access to our markets including the enduring day-ahead Frequency Response and Reserve markets.

Single Markets Platform

The benefits of our BR service

The BR service enables us to move to day-ahead procurement of the energy reserves we need and respond to system demand in real time, rather than the current on-the-day system. This allows us to reduce the cost of procuring energy reserves and improves system security.

The cost benefit analysis we commissioned in August 2023 showed the BR service will deliver at least £639m of savings for consumers over the next four years, and this could reach up to £821m in our best case.

View the cost benefit analysis

Results from the first BR auction

The BR auction secured both positive and negative reserve volume. Ten providers entered the auction with 47 units taking part, submitting over 5,500 bids.

We utilise a product called Regulating Reserve to correct energy imbalances (differences between generation and demand) on the system with real-time instructions. The new BR service allows us to procure Regulating Reserve on a firm basis at day ahead. This helps reduce balancing costs and improves system security as the reserve capacity is guaranteed for the control room to access when they need it.

What’s next for the BR market?

As the BR market develops, we’ll be moving to a dynamic reserve setting model that will be used to inform our procurement targets for reserve, the day ahead requirements and medium term forecasts will be published on the Data Portal.

Access the Data Portal