Release 1 of the Open Balancing Platform (OBP) went live in December 2023, according to the Electricity System Operator's first Annual Balancing Cost Report1. The platform is one of a set of commercial mechanisms the ESO describes as part of its balancing costs strategy, alongside new services and auction arrangements1.
The same report records that in November 2023 the procurement of Dynamic Containment, Dynamic Moderation and Dynamic Regulation was moved to the Enduring Auction Capability (EAC) platform, which the ESO says offered enhanced functionality such as splitting, co-optimisation and negative pricing, leading to greater efficiency and reduced prices1. The report also states that the Local Constraint Market has been open regularly since December 20231.
"Release 1 of the OBP went live in December 2023."
The report gives the wider cost picture for the year in which the platform launched. Overall balancing costs were significantly lower in 2023/24, at a total spend of £2.4 bn, compared with £4.1 bn in 2022/231. Net balancing volumes fell to 10.8 TWh in 2023/24, well below the 2020/21 peak of 21.4 TWh1. Thermal constraint costs were the largest single component, contributing 40% of balancing costs in 2023/24 against 36% in 2022/231. Reserve costs fell significantly year on year, with reserve volumes down from 5.7 TWh in 2022/23 to 4.8 TWh in 2023/241.
| Measure | 2022/23 | 2023/24 |
|---|---|---|
| Total balancing spend | £4.1 bn | £2.4 bn |
| Net balancing volumes | not given | 10.8 TWh |
| Thermal constraint share of costs | 36% | 40% |
| Reserve volumes | 5.7 TWh | 4.8 TWh |
The report does not set out what Release 1 of the OBP does in technical terms, nor which services it covers; those details have not been reported in the material available1.
Why it matters for households
Balancing costs reach households through the Balancing Services Use of System (BSUoS) charge. The ESO reports that in 2023/24 BSUoS contributed to about 4% of electricity bills for an average domestic consumer, which it puts at about £4 a month on a typical domestic electricity bill1. That figure is a component of the bill rather than a total, and the report notes that balancing costs are one of many components making up energy bills1.
For a home's energy independence, the relevant point is that the cost of keeping the national system stable is shared across all consumers, including those who generate some of their own power. The ESO states that balancing costs are projected to rise out to 2030, with constraints the main driver, and that its initiatives create savings worth around £18 bn before 20301. It also states that future balancing costs are not fixed and can be lowered through proactive measures from the ESO and industry1. The report does not quantify what effect the OBP alone has had on household bills1.
What happens next
The report lists further milestones: the interim CMIS EC5 service launched in February 2024, with an enduring service from April 20251. The second Review of Electricity Market Arrangements consultation, published on 12 March 2024, seeks feedback on options that the ESO says have the potential to reduce thermal constraint costs1. The ESO also records that at the start of 2024 it issued connection contracts with accelerated connection dates for 10 GW of battery energy storage1. No further OBP releases are dated in the report1.
Sources1 cited
- PowerPoint Presentation, neso.energy