Shaped Operating Envelopes: Distribution Network Capacity Allocation for Market Services

The transition from centralised, fossil fuel-powered generating units to distributed energy resources (DER) represents a significant step forward, offering numerous benefits. However, this shift also presents operational challenges for distribution network service providers (DNSPs) and the electricity markets. In this paper, we introduce our innovative solution for allocating network capacity in the form of operating envelopes, shaped to enhance customer participation in energy and reserve markets. Our approach also provides DNSPs with network support flexibility of DER which can be leveraged to either increase network throughput for market services or postpone network augmentation. This study outlines our initial findings from Project Converge—a comprehensive real-world trial involving 1000 active customers (the largest participant cohort in Australia) located in the Australian Capital Territory. Within, we discuss the challenges we have encountered, the opportunities that have arisen, potential avenues for future expansion, and the invaluable insights gained during the pre-trial phase of the project.