March has been a fascinating month for those following the Dynamic Containment service. On 3rd March accepted volume decreased by almost 80% in one day as market participants saw greater revenue opportunities in the volatile wholesale market and withdrew assets from DC, with peak hour prices on EPEX clearing above £600/MWh. A consolation for Grid is that the low renewable forecast causing the volatility would have implied less need for frequency services, with a larger proportion of thermal generation running.
As the month has gone on, accepted volumes have ratcheted almost 50% higher to close to 600MW, reducing the structural short capacity. This remains significantly below the Grid target for 2021 however, with guidelines of between 0.8 – 1.4GW.
With DC prices continuing to clear at £17/MW/hr, dynamic FFR prices have increased since DC’s introduction in October to around £9.5-11.5/MW/hr, with a high proportion of bids being rejected as Grid prices FFR against alternative actions.