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SSEN outlines principles of DSO transition in ‘almost unrecognisable’ new energy market

Scottish and Southern Electricity Networks, the networks arm of SSE, has outlined the principles of its transition to a Distribution Systems Operator (DSO) as it aims to get to grips with the “almost unrecognisable” emerging energy market.

The firm is the latest Distribution Networks Operator (DNO) to unveil the terms of its DSO transition strategy, the step which each DNO is having to encounter as the UK energy paradigm shifts.

SSEN summarised this change by arguing that the UK electricity system now encourages a more bi-directional, dynamic flow of energy, one that is almost unrecognisable to the traditional system today’s networks were built to support. 

This has led to much inward-looking from today’s network operators, and SSEN has established five key principles for it to focus on as it transitions to a DSO. These are;

  • The DSO must work for all customers;
  • It must learn by doing, and for the best outcomes;
  • The transition must be co-ordinated and cost efficient;
  • Technology neutrality is paramount, and;
  • It must unlock local solutions.

Those five principles all take into account three key considerations, typically costs, collaboration and customers.

Meanwhile DSOs are to take on far greater functions than before, moving into areas such as flexibility procurement and system co-ordination. This, SSEN has said, will fall into three main stages: planning, procurement and operation and dispatch. 

SSEN has heaped importance on the first two stages, suggesting that getting those two correct will reduce its involvement in the third stage, which would in turn save costs.

The firm cited research by Imperial College and the Energy Networks Association that claimed more efficient management of the networks could deliver costs benefits totalling as much as £40 billion by 2050, but stressed that these would be “significantly dependant” on DSOs having the right capabilities as early as possible.

To ensure its transition is on track SSEN has established a series of commitments that it aims to fulfil each year through to 2020, and then beyond.

Actions already committed to in 2017 include the deployment of a DSO team that is established and supported by other areas of the business, an £100 million investment in IT upgrades, making flexible connections available to generators and an active solutions team aiming to move certain innovative solutions to ‘business as usual’ operations.

Stewart Reid, SSEN’s head of DSO and innovation, said that its transition promised to “fundamentally change” the way it manages local electricity networks.

“To help inform our transition to a DSO we are looking to consider views from all walks of life, particularly electricity consumers given the importance in getting this right for those who ultimately pay. 

“We would encourage anyone with an interest in the transition to a smarter, more flexible electricity system to respond to our consultation with their views which we will look to consider as we continue our transition to a DSO,” he added.

All stakeholders are invited to respond to SSEN’s DSO consultation which remains open until 15 January 2018.

SSEN is the latest of the six DNOs to publish DSO strategies, following from the likes of UKPN and WPD which published theirs in the summer. While they have varied in detail and commitments, those published to date have all been quick to talk up the scale of the change necessary with UKPN in particular stating it to be “as significant as the advent of broadband”.