Serhii Kravchuk, Director of Electricity Trading and Supply in KNESS, about new business models for active electricity consumers

Serhii Kravchuk, Director of Electricity Trading and Supply in KNESS, talked about new business models for active electricity consumers. The expert’s speech was held as part of the PRO SYNTEZ conference “Business and energy sector in war time”. The event was organized by the Poltava Business Association.

Current challenges are a shortage of generating and maneuvering capacities in the power system. The horizon for the coming years is the need to decentralize electricity production, including through renewable energy sources and increase maneuvering capacities, including energy storage facilities to balance the country’s integrated power system.

How can businesses prepare for the energy challenges of today and tomorrow and at the same time support the resilience of the energy system? 

“Active Consumer” Model

Active consumers include businesses that have the right to install a distributed generation facility, such as a solar or low-capacity wind farm, and to supply electricity to the external grid within the limits of the permitted connection capacity. In this way, the company can partially cover its electricity consumption needs with the generated electricity and at the same time increase the share of electricity from renewable sources in the country.

Among other things, it is about a mechanism for integrating clean distributed energy resources that has been proven in international practice, which will allow the development of decentralized renewable energy and increase the sustainability of energy supply.

Aggregator Model

Active consumers can become members of an aggregated group and receive additional revenue from it. Most importantly, aggregation activities have a systemic positive impact on the energy market functioning. In particular, the involvement of active consumers in the power system balancing processes will partially cover the shortage of maneuvering capacities. Also, through the aggregator, a consumer with an ESS installation can provide services in the ancillary services market.

In the context of the distributed generation volume increase, including that connected to the consumer’s internal grids, the development of energy storage facilities and the emergence of active consumers, aggregation activities enable the transmission system operator to involve these facilities in balancing the integrated power system of Ukraine on market conditions. The aggregator is an important link in dispatching, as it manages the capacity of distributed facilities: consumption, production, and storage. For market participants, this provides an opportunity to generate additional income, and for the transmission system operator, it means more balancing capacities and simplification of the dispatch management structure.