Episode 10: Power Responsive: flexibility is our hidden power

Future of Utilities Podcast 

Power Responsive: Flexibility is Our Hidden Power 

Lindley Gooden: Hello, I’m Lindley Gooden. Welcome to the Future of Utilities podcast. We’re joined by somebody very special today – we’re going to talk about NESO’s Power Responsive programme, and how flexibility could be our superpower. We have a great guest, Jonathan Wisdom from NESO. Great to have you with us – first of all, tell us who you are and what you do. 

Jonathan Wisdom: Thanks, Lindley, really pleased to be here with you all today. My name is Jonathan Wisdom, John for short. I look after the development and delivery of our balancing services at NESO – how parties participate in our markets. NESO is the National Energy System Operator. Today, we keep the lights on and operate the electricity system, but we also plan tomorrow’s energy system, and that means everything needs to work holistically – we want to keep our hands around that to make it work. Flexibility is a really important part of that, and we want to make sure consumers have the opportunity to participate across our energy system and be genuinely involved. Really looking forward to this conversation. 

Lindley Gooden: Brilliant. Let’s start with flexibility, because it’s the word of the moment, really – energy security starts at home in many ways. So can you describe the Power Responsive programme – what’s it about, what’s the mission, and why? 

Jonathan Wisdom: Absolutely. Power Responsive has been within NESO for a while – it probably came to life around 10 or 11 years ago, and it’s very much about engaging the market and understanding what demand-side participation could look like. NESO knows it has a role, as this whole-system entity, to drive flexibility and encourage its participation as much as possible across all our products. What that means in practice is that we worked with Ofgem and government last year to focus on how Power Responsive could evolve and change to drive forward the actions we need to take. Power Responsive has now evolved into something that engages directly with consumers, helping them bring their flexibility to market and participate in the energy system like never before. 

Lindley Gooden: What’s the purpose, really? A lot of what we’re hearing today is about stabilising demand for energy. 

Jonathan Wisdom: That’s very much part of it – working with consumers, but also with suppliers, to make sure that two-way flow of energy is healthier, particularly at times when a lot of energy is needed. NESO, as the system operator, needs access to these resources to operate the system and keep supply and demand in balance at all times. That’s where flexibility becomes really useful. We’re no longer in a world where large centralised loads provide all of our generation. We’re in a world where decentralised loads need to come and participate in our energy system, like they haven’t done before. Power Responsive is there to help consumers do that – to understand how to engage with suppliers and aggregators, and to understand the capacity and capability of what they have to offer in flexibility. 

Lindley Gooden: Someone looking at this from the outside, at a headline level, might assume it’s really about the big energy suppliers, and that it doesn’t involve them if they’re a smaller player. So who do you actually want at the table? Who needs to be part of this conversation? 

Jonathan Wisdom: Great question. Across the energy system, we’re moving to a world where consumers aren’t just taking energy from the network – they’re able to change their behaviour, and with recent changes to the rules and regulations, that changed behaviour can now be reflected back to them in real financial value. So this can genuinely be for anybody. We want to work closely with domestic users, through suppliers and aggregators, but particularly with industrial and commercial actors – organisations that may want to understand their energy use better, understand how their loads could offer flexibility, and understand what value that represents to them and their organisation. 

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Lindley Gooden: Slightly off the main thread, but we’re living through a cost-of-living crisis that affects domestic customers, and in many ways a cost-of-business crisis too. So this is also about businesses desperate to reduce costs, but also to have a genuinely stable relationship with their utility suppliers – that’s part of this conversation too, isn’t it? We need to look at the wider world around us. That’s come through a lot at the summit this year – that we need to be having these conversations even outside our own industry. 

Jonathan Wisdom: Absolutely – energy, and the cost of energy, is a challenge for households and businesses alike. The way we can approach this with businesses is to help them understand: yes, there’s a gross cost of energy, and a demand process that has to be met because it’s satisfying their core business activity. But can we build on that, and help them understand the value that exists beyond simply that demand process – and how they can actually take advantage of it? 

Lindley Gooden: Let’s bring it into the real world, down from policy level for a minute. Are there examples where you’re starting to see this relationship actually build – genuinely encouraging conversations happening? Sometimes one individual case can illustrate the whole process. What are you seeing? 

Jonathan Wisdom: Through the start of this work with Power Responsive, going out and engaging with different parties, we’ve focused first on building awareness – can we generate that through the events and engagement we take part in? That engagement is our key way into understanding these consumers, their loads, and how they actually work. As NESO, we don’t have that natural, existing customer relationship with these types of users, so we want to get out to places like Future of Utilities to understand how we can build that and turn it around. My team has been out talking with a wide range of consumers – we’ve recently seen a lot of interest from cold storage operators, from supermarkets, from EV fleets, all of whom recognise this could be a real benefit to their business and how they operate. 

Lindley Gooden: I suppose in some ways we’re all a bit blinded by our own challenges – I run a business myself, and it’s difficult to see further afield. So we need a translation piece here – we need someone like you and your team to come through and say, “here’s what we’re doing.” That kind of information flow can genuinely help this progression toward a smarter, smoother supply system. 

Jonathan Wisdom: Yes, absolutely. You’ll never hear me disagree that there’s significant complexity in our market and our industry. What we’re trying to do through Power Responsive is take some of that complexity and challenge away, to make this a genuinely accessible way of engaging with a market we all participate in every day. Everyone uses energy every day – the question is how we make this something active and encouraged, where parties actually understand the value to them. That’s really important. 

Lindley Gooden: It’s interesting – I imagine you’ve found this too – there’s a real barrier to break through with individual consumers and business owners like myself, convincing them they’re actually part of this conversation. It can also be a bit painful to talk about energy prices at the moment. So how does someone like me get involved? What would you say to people like me, or even larger businesses, who need to be part of this and want to get involved? 

Jonathan Wisdom: A few things. First, I’d say we take this extremely seriously – it’s a core part of NESO’s mission, role, purpose and vision, to deliver growth in flexibility and in these markets, which inevitably helps us manage the system while providing real value in return. This isn’t something temporary – it’s something we genuinely believe in and want to see developed and pushed forward. You can see that in the work we do: we have our Power Responsive function taking this forward, and two other programmes within NESO focused specifically on enabling demand-side flexibility – looking at what barriers across the industry might be getting in the way of people’s ability to participate, and secondly, our routes to market. For all of our individual products, which I appreciate can look daunting and complex from the outside, how do we make those as easy to interact with, and as easy to understand and work with, as possible? Consumers have a business to run and understand – we want to make participating in flexibility as easy as possible, in a way that fits around the business they already have to run. 

Lindley Gooden: Final thing for our audience here at the summit – you’re all either involved in or running businesses, some in energy supply. Hands up if you’d like to have a healthier conversation with your consumers, and maybe even with NESO and others through the network. 

[A majority of hands go up.] 

Lindley Gooden: That’s about 60% – a small straw poll, but a majority of people, which is an important thing, isn’t it. So from here, I guess it’s a case of getting out there and continuing to have this conversation. What’s the endpoint for you? What’s the goal for Power Responsive – what would you like to see? 

Jonathan Wisdom: We’ve identified that there are opportunities across the sector for all sorts of demand to participate. At the end of last year, we published targets for ourselves – how do we really run at this, develop it, and grow it successfully? We think there’s currently around 200 megawatts-plus of participation in these markets. We want to grow that to around 950 megawatts, close to a gigawatt, of flexibility participating by 2030. That’s how seriously we take it, and that’s what we’re aiming for. 

Lindley Gooden: And what will that actually give you? I imagine data, feedback, stories – what does hitting that target tell you? 

Jonathan Wisdom: Yes, absolutely – but it will also continue to prove, because I wouldn’t say it’s fully proven yet even though it’s there and participating, just how important flexibility is to our whole system, and how much we need to understand and account for that as the national energy system operator moving forward. 

Lindley Gooden: Brilliant. Thank you, John – lovely to have you with us, and thank you for all the honesty, it’s always appreciated. 

Jonathan Wisdom: Thank you very much. 

Lindley Gooden: And that’s it for now from the Future of Utilities podcast. Great to have you with us too – take care. 

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