Redispatch 2.0 – The end of the interim transition phase

Redispatch 2.0 – The end of the interim transition phase

What does this mean for plant operators?

In the course of the second edition of the Network Expansion Acceleration Act (NABEG 2.0), network bottlenecks are managed by means of the newly imposed regime of Redispatch 2.0, since October 1, 2021. For its timely implementation, a so called “interim transition phase” has been implemented for the proper conversions through Redispatch 2.0, which ends on May 31, 2022. What exactly will change for electricity producers and what role does the transitional solution play for plant operators?

Recap: Why Redispatch 2.0?

To keep the power grid stable, a so-called dispatch regulates power plant deployment planning. The transmission system operators (TSOs) receive reports on much and when a power plant will feed power into the grid, and use this information to prepare grid status analyses. If this results in bottlenecks or overloads in the grid, the TSOs order changes to the power plant schedules, known as redispatch. Redispatch is therefore a redistribution of power plant output to prevent incorrect utilization of the power grid.

Due to delays in Germanys’ grid expansion, the nuclear phase-out, the expansion of renewable energies (RE), and the associated unstable load flows, redispatch measures will be taken more and more frequently in the future. This is where Redispatch 2.0 comes in: New regulations for handling grid congestion are intended to provide a remedy for the future by optimizing the total costs from conventional redispatch and feed-in management so that grid charges can be reduced.

Redispatch 2.0: What’s new

Redispatch 2.0 ensures that more players than before have to shift their planned electricity production to avoid grid bottlenecks. Since decentralized plants often start locally at the grid bottleneck, they are better suited to remove it quickly. With Redispatch 2.0, therefore, not only conventional power plants but also renewable energy plants of 100 kW or more that can be remotely controlled by a distribution system operator will be included in the redispatch process. This means that not only the TSOs can request a redispatch of the planned generation, but now also (distribution) grid operators participate in the redispatch process. Thus, the previous regulations on feed-in management will be repealed as of October 1, 2021 and transferred to Redispatch 2.0.

Redispatch 2.0: Obligations for plant operators

Plant operators of RE plants with more than 100kW, as well as plants below 100kW that are already remotely controllable, are obliged to participate in Redispatch 2.0. The new obligations include the notification of master data, master data changes and unavailabilities of the plant to the grid operator. Plant operators will therefore be held more accountable. If they do not wish to take on this responsibility, they can appoint a deployment officer (EIV) to take on these duties, e.g. the direct marketer.

Plants in direct marketing have it easy here – operators can usually hand over the data delivery obligation to the direct marketer and have the transmission of non-utilizabilities, i.e. power restrictions of the plant, carried out by the direct marketer as EIV to the Redispatch 2.0 DataProvider Connect+.

Switching to direct marketing is worthwhile – especially in view of the current record high electricity prices, when additional monthly revenues can be achieved by marketing the electricity. At the same time, the direct marketer can take over the redispatch duties. The direct marketer can act not only as EIV, but also as Balance-responsible party (BRP), i.e. as operator of the technical resource (the plant) on behalf of the plant operator. In this way, the coordination of the billing-relevant outage work with the TSO is also taken over.

Of course, this requires the cooperation of the system operator, since only the operator knows the detailed master data of his system and when, for example, maintenance is planned or what changes in regard to the self-consumption of the produced energy are developing. Only if the plant operator provides this information to his EIV or BRP service provider can the latter fulfill the formal redispatch obligations for the plant operator.

The current interim solution

Due to initial implementation difficulties of Redispatch 2.0, the German Association of Energy and Water Industries (BDEW), together with the Federal Ministry of Economics and Climate Protection (BMWi) and the Federal Network Agency (BNetzA), developed an interim transition phase for getting started. This transitional phase thus applies primarily to the establishment of operational readiness on the part of the network operators and to the balancing of accounts.

The network operators thus have until March 1, 2022 to establish operational readiness for handling redispatch 2.0 in accordance with the target model. Since March 1, 2022, the new measures have been in a test phase that ends on May 31, 2022. Consequently, June 1, 2022 is the first day of regular Redispatch 2.0 operation, by which time all participants must be operational.
Operationally ready in this context means that a grid operator that initiates a redispatch measure provides the amount of energy not generated by the affected plant as a result as part of the balancing process. If a network operator cannot report operational readiness by February 28, 2022, the existence of a justified exceptional case will be examined between March 1, 2022 and May 31, 2022.

This means the end of the interim transition phase for plant operators

As stated above, the main parties affected by the transitional solution are the grid operators and the balancing responsible party (BRP). Since balancing group management is usually taken over by a service provider, such as the direct marketer, the regulations and thus also the end of the transition phase typically have no effect for plant operators. The obligation to report master data and non-claims has already existed since 01 October 2021 and is not affected by the transitional solution.

The transitional solution primarily ensures that the balance sheet compensation of the compensation measures carried out by Redispatch 2.0 takes place in an amount of 0 MWh. This means that until March 1, 2022, or May 31, 2022, existing claims of the BRP for energy quantities will be financially compensated. Regardless of the nature of the compensation, it remains the case that an electricity supplier’s existing BRPs are responsible for the balance sheet compensation. This means that this part of the transitional solution only affects network operators, balancing group managers and transmission system operators.

The financial compensation that BRPs receive for redispatch measures is based on the balance sheet compensation that the network operator provides in the target model. Plant operators also receive the market premium from the grid operator for energy quantities that are not generated by the plant due to redispatch measures. The direct marketer compensates the plant operators for the market value of the redispatch measure in accordance with the individual contractual provisions.

Plant operators are therefore not affected by the transition phase. They had to report all data for the scheduled start on October 01, 2021. Accordingly, the transitional solution also has no suspensive effect. There are no regulated fines yet for plant operators who missed the deadline for data delivery. However, missing data will be reminded by the network operator. A further postponement of the deadline is to be avoided, although it cannot yet be said for sure whether all network operators will be ready for the target model by the end of the deadline.

Author: Virtuelles Kraftwerk of EnBW

Virtuelles Kraftwerk is one of the largest direct marketers in Germany. Via its digital platform, it combines many producers of green electricity into an intelligent ‘swarm’ with integrable solutions. Virtuelles Kraftwerk bundles the decentral generated electricity from these renewable energy plants and sells it to customers throughout Germany.