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GB monthly FFR market summary – March 2021

We are pleased to present our GB monthly FFR market summary for March.

Key highlights from the report include:

  • February Dynamic Containment (DC) auction prices remains high, averaging £17/MW/h. While volumes have steadily increased to a daily average of 388 MW (an increase of 14.5% from January), it is still well below National Grid’s 800 MW minimum target. Two new participants entered the DC February auction, Open Energy and Origami Energy, each accounting for 0.5% and 1% of total accepted volumes respectively.
  • March dynamic FFR tender prices declined relative to February, with a volume-weighted average of £11.4 /MW/h and 28 accepted dynamic bids (of 94 bids submitted)1. Weighted average prices have remained relatively high between £9.3-11 /MW/h since the introduction of the new DC service in October 2020 as the maximum accepted bids are set by the opportunity costs of participating in the alternative service.
  • March dynamic FFR monthly tender saw procured secondary volumes decrease by 84% to 35 MW, relative to February. Interestingly, National Grid’s requirement for secondary response is 450 MW, yet 70% of submitted bids were rejected due to prices being more expensive against alternative actions. This could be associated with high turn down costs and DC currently offering around 400 MW of low turn-up. Social Energy secured the highest accepted price at £12.5/MW/h during EFA blocks 3-4. REstore Flexpond secured the largest share of total accepted volumes at 10.6 MW, followed by Limejump, which secured 7.7 MW.
  • Following zero procurement in the winter months, March saw static FFR bids once again being procured by National Grid. 8 static bids were accepted with a volume weighted average of £0.83 /MW/h. Over 95% of the duration weighted volumes came from PeakGen’s demand side flexibility (DSF) distributed generation. Centrica achieved the highest bid price at £1.99/MW/h with its 16hr onsite DSF generation asset.
  • National Grid set the maximum procurement volume to 200 MW for each EFA block for the Dynamic Low High (DLH) weekly auctions to procure more FFR volumes closer to real time. However, volumes in the DLH auctions for March delivery averaged around 60 MW across the six EFA blocks, much lower than the new volume cap and the previous month’s procurement of 68 MW. Prices increased from last month and are averaging at £10 /MW/h across the six EFA blocks, a 27% increase from February’s auction.
  • Procured volumes in the Low Frequency Static (LHS) auctions increased by 17% compared to last month’s auction, averaging at 92 MW across the six EFA blocks. Prices continued to remain constant compared to the last 12 months.
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