By BEN COOK
- Tech provider Origami agreed deal with investor Gresham House
- Origami CEO says real-time data ensures assets meet expectations
- Asset owners must check they have enough data, CEO says
Are you getting the most out of your energy storage assets?
Peter Bance, chief executive of green energy technology provider Origami, says that many operators of energy storage assets are failing to grasp an opportunity to harness the power of real-time data.
By properly utilising such data, Bance says that operators of energy storage assets can not only monitor whether those assets are providing financial returns that meet expectations, but also evaluate whether their commercial strategy is being successfully executed.
In addition, the use of real-time data can also help storage asset operators manage long-term risks better in the context of warranties, for example.
Bance argues that Origami’s energy technology platform enables operators to achieve all these objectives.
And Gresham House Energy Storage Fund is on board. In April this year, it was announced that the investor would be partnering with Origami at its 40MW Glassenbury A and 10MW Cleator projects in the UK to manage the “extraction and orchestration” of operational data from the assets.
Gresham House Energy Storage Fund manager Ben Guest said Origami’s platform had “enhanced the visibility and flow of data from the sites”. He added: “This means higher revenue potential today and greater agility when considering future revenue options.”
Energy Storage Report spoke to Bance to discuss the biggest opportunities in the storage sector, the challenges storage asset operators are facing and where they may be going wrong when it comes to managing their assets.
What are currently the biggest opportunities for Origami in the storage sector?
Peter Bance: We’re seeing opportunities in storage in markets, or even geographies, where you end up with one or more of these common factors: firstly, increasingly large penetrations of renewables, whether those are physically co-located sites with storage, or simply notionally managed together; secondly where value pools or markets or prices are becoming more and more volatile; and thirdly, where we end up with more and more congested networks, whether those constraints are due to the fundamental capacity of the pipes and wires, or an acute need to manage a lot of renewable generation or a lot of load. In addition, the behind-the-meter space, which has historically been complicated, is going to really start booming.
What exactly are the challenges your clients are facing and how is Origami helping those clients overcome them?
PB: A client comes to us when they realise that they need a digital solution to succeed in the market. So that could be because the avalanche of data is overwhelming, they need a high-tech real-time data-based solution, or they simply need access to pools of value they haven’t previously had access to. Historically, the sector has thought of physical assets and physical data, and it has separately considered financial data – trading and money – and then it’s considered contractual data and PPAs and commercial contracts. Those were in completely separate worlds, but actually you need to bring them together, the physical, the financial, and the contractual domains, as well as the associated data, to succeed.
Historically, all of our clients have had some experience in the physical, financial and contractual domains, but in different silos with different teams. Bringing those together is the brave new world that we’re enabling. So you can seamlessly consider doing something physical, like dispatching an asset, or doing something financial, like placing a trade, or doing something contractual, like signing up a different route to market on different PPA terms and you can make three different decisions simultaneously if you’ve got access to those three fundamentally different types of data on one platform.
What financial benefits does this have for the user of the platform?
PB: It’s partly about improving the risk-adjusted return for those assets. Especially in an era of greater volatility and uncertainty and complexity. Making money and making money consistently, despite the massive gyrations in the market is increasingly challenging. But even more fundamental, if a customer of ours has got a route to market, quite often they just get a check in the mail, it’s not obvious where the money came from or how it was made or whether it was the right number. What we’re doing is providing them with a layer of technology that not just lets them see what’s going on, physically, in dispatches of the asset, but providing them with transparency, basically financial reporting of how much money they made every second of the day. It puts them in control and gives them visibility on what they’re actually making.
By giving clients this ‘control’, what opportunities does it create for them?
PB: What they’re trying to do with that level of control and transparency, especially in real time, is to see whether what they contractually thought was going to happen in terms of executing on that commercial strategy is actually being delivered. Every second, every hour, every day, are the financial returns reflecting what their expectations were? And, also, is the commercial strategy they’ve agreed actually being faithfully executed? Or are there significant deviations away from that commercial strategy? This includes whether they’re managing the long-term risk around warranty provisions from their battery suppliers, for example.
Also, in these volatile times, that real time visibility and transparency might let them make judgements themselves, which they couldn’t historically do. For example, like saying, ‘let’s throw caution to the wind and really let rip with our commercial strategy because we can make hay while the sun shines’ – in times of massive price movements, they could take conscious risks that they wouldn’t historically have taken, partly because they couldn’t even see what was happening.
So where are some operators of storage assets currently going wrong?
PB: A lot of energy asset investors, or owner operators, when they’re just getting going, they err on the side of simplicity. Maybe they just give all of the monetising and monitoring and dispatching over to a route to market provider, potentially. They say ‘just do it all for me and just give me a check’. But I think increasingly the reality, whether it’s when they reach a certain critical mass of assets or they believe it’s strategically important to see more transparently what’s going on – or for them to take a more active role in the commercial strategy rather than just giving it all to a third party – they reach a point where they actually want to use an independent technology platform to see what’s going on and decide what to do about it.
We see many of our customers going from a more passive to a more active position in the market and hence why they now want their own independent technology platform at their disposal, as opposed to just being passive takers of whatever energy companies give them in terms of returns.
Are a lot of storage asset operators still quite passive in this respect?
PB: I think a lot of them started out that way because they had locked in relatively fixed contracts, But now those simpler mechanisms are expiring. They’re now having to make money in this very dynamic market. So, I think it’s partly market forces that are requiring them to become more active themselves. I think there are opportunities you can get if you take a more active approach than a more passive one. You can start getting a sense of which energy traders are giving you a better, or less good, return or maybe how you want to take on some of that responsibility yourself as an owner-operator of those assets. Some of our customers are using our platform to do their own dispatch on their own trading.
If an operator of energy storage assets believes they aren’t optimised, what factors should they be considering if they want to address this issue?
PB: Start with the basics. Is there decent telemetry from those assets? Are they getting enough real-time data, not just data once a day or once a month.
Start with the fundamentals, not just from the physical assets, but tapping into the real-time data from traded exchanges so they can see what prices are doing. Access to physical and financial data is absolutely central to even have a hope of delivering the right level of optimised returns that they’re hoping to achieve.
Are they getting availability or outage information or not? Are they dropping data for a minute or an hour or a day? Sometimes they’re not even aware that there’s a problem to act on. So, there’s that kind of quality of information, not just the access to the information itself. And then the speed and latency of that data is also important. The whole data journey is something they should focus on. Then once you’ve got the foundations of data, then you can build applications on top of it.