LCP Delta was commissioned to support BEIS, formerly DECC, to develop their internal modelling capability so they could better assess the wider impacts of various generation technologies being added to the GB network.
In partnership with Frontier Economics, we reviewed the factors that affect whole system costs and developed a framework to categorise these impacts as either generation, capacity, network or balancing costs.
Our modelling approach was developed to quantify these impacts across a wide range of factors including:
- Generation costs, allowing for the displacement of existing generation due to new technologies
- Capacity costs, based on generation reliability allowing for intermittency and flexibility
- Balancing (and Ancillary service) costs, accounting for short term variability due to inaccurate short term forecasts in demand and generation particularly intermittent generation.
- Network costs, allowing for varying transmission and distribution charging arrangements.
These developments were integrated into our EnVision model (used by BEIS and also known as the DDM). This has allowed BEIS to assess the whole system impact of various technologies, develop policies to incentivise generators to reduce costs they impose to the overall system and identify technologies which provide the greatest benefit to the wider energy system.