The Local Constraint Market (LCM) is a day ahead / within day flexibility market designed to tackle the thermal constraint across the Scottish transmission boundaries (B4 & B6). Several factors such as growing renewable generation in Scotland are set to increase power transfers across the Scottish boundaries, increasing constraints and ultimately costs to the end consumer.
The LCM aims to reduce overall costs of this constraint by providing an alternative to the national Balancing Mechanism, complementing the existing market in managing the transmission constraint.
The LCM harnesses distribution-connected flexibility through Generation Turn Down or Demand Turn Up. NESO & Piclo aims to develop a market that facilitates access to new providers of flexibility and reduces the barriers to entry for new market entrants. Piclo & NESO are also working closely with the DSOs to ensure appropriate visibility and coordination in LCM actions.
Further information from the NESO on the LCM is published here
You can also find out more about Thermal Constraints here
Several factors such as growing renewable generation in Scotland are set to increase power transfers across the Scottish boundaries, with a corresponding forecast in thermal constraints and ultimately costs to the end consumer.
We are exploring the development of a new Local Constraint Market to access new sources of flexibility to help manage our most constrained boundaries at and above the B6 boundary
The B6 boundary separates the transmission network at the SP Transmission and National Grid Transmission interface, running roughly along the border between Scotland and England.
We’re keen to develop a market that facilitates access to new providers of flexibility and provide competition to the Balancing Mechanism – and so complementing our existing market for the majority of transmission constraint management. We see this local constraint market working alongside existing NESO and DNO approaches and providing visibility, flexibility and coordinated control through appropriate systems and processes.
LCM will play another part in NESO’s role to:
Further information from the NESO on the LCM is published here
You can find out more about Thermal Constraints here: https://www.neso.energy/news/what-thermal-constraint-management-and-why-it-important
Every step of the journey is hosted in Piclo from qualification to bidding, market clearing in the NESO control room, to provision of dispatch instructions and settlement. A summary of the key timings for the Day Ahead and Intra Day instruction windows are below:
If you would like further detail or book a demo of the operational process, please contact der@piclo.energy
The LCM competition boundaries may vary in geographical extent on a daily basis but the qualification area covers most of Scotland (excluding ANMs).
Eligibility (for full details review the service terms):
The service is a 'utilisation only' payment based on energy delivered and the baseline methodology is 'nominated' by FSP at time of bid.
The LCM is trialling an innovative approach to reimbursing balancing actions in pioneering a path for 'opting out' of ABSVD. Non-suppliers benefit from an additional payment at the wholesale price. Read more here
For agreement (and signing) by FSP:
Other useful links:
Note: For Flexibility Service Providers who are not already an approved Ancillary Service Provider and as such are notset up in the NESO Settlements and Finance system, please complete the 'New Service Provider Form' and send to the email address referenced within the form. Further guidance for completing this form can be found here: 'New Provider Guidance Document'