Dynamic Containment 4 Day Forecast
Summary
NESO publishes 4-day forecasts of Dynamic Containment requirements for frequency response services, using demand, inertia and loss forecasts. The methodology estimates both high and low frequency response volumes needed to secure the largest credible system loss. Actual day-ahead requirements may differ based on real-time optimisation and interconnector flow changes.
Why it matters
This transparency allows battery operators and other frequency response providers to position for DC auctions more efficiently. As such, it should compress bid spreads and reduce balancing costs, though the caveat about real-time changes means participants still face basis risk between forecast and actual requirements.
Key facts
- •4-day forecast horizon
- •Covers Dynamic Containment High and Low requirements
- •Methodology includes demand, inertia, response volumes and largest loss estimates
- •Day-ahead requirements may change from forecast
Areas affected
Memo
The dataset contains forecasts of our Dynamic Containment Low and High requirements for the next 4-days. The methodology uses forecasted demand, inertia, and response volumes as well as a view of the largest losses on the system to estimate the DC requirements. The actual requirements day-ahead are likely to change based on optimisation carried out closer to real-time coupled with greater visibility of inertia, demand, and loss sizes. For example, changes to interconnector flows from our forecasted position can lead to either an increase or decrease in our requirements if the change impacts the largest loss we need to secure.