EV fleets participate in the UK grid’s balancing mechanism thanks to Kraken’s optimizations

Kraken is enabling thousands of EVs to integrate with the UK’s national grid balancing mechanism for the first time, paving the way for optimized charging that contributes to a stable electrical network.

All electrical grids must constantly balance electrical supply and electrical demand to avoid power cuts and surges. In the UK and beyond, the ‘balancing mechanism’ is where grid operators tell certain generators and consumers to ‘turn up’ or ‘turn down’ their energy usage to ensure supply and demand line up in real-time.

Assets that participate in balancing mechanisms must be incredibly responsive. That's where Kraken comes in. Kraken enables EVs to meet the responsive demands required to become a key part of grid balancing mechanisms. UK grid operators now have another important tool in their belt, and Kraken has proved that EV fleets can play a critical role in creating a more stable, cost-effective energy system.

So how does it work?

Kraken enables Britain’s largest electricity retailer, Octopus Energy, to offer a special product in the form of a ‘tariff’, or ‘rate’, to customers with EVs. These EV make up the fleet that then participates in the grid balancing mechanism.

When the grid sends a request for Kraken’s help, new schedules are rapidly sent to devices, with instructions to charge, or stop charging in order to meet a specific ‘volume target’. These are then actioned, re-optimizing the fleet within minutes.[1]

Crucially, Kraken simultaneously ensures a hassle-free customer experience for drivers themselves. The integration prioritizes individual customer charging preferences. Drivers plug in during the evening and then Kraken works behind the scenes overnight to optimize charging according to operators needs,[2] making sure that the vehicle is charged to the customers’ preferred level at their preferred time, at an especially competitive rate.

Solving the EV charging challenge

As the number of EVs on our roads increases, so too does their relevance to grid management. By 2030, there will be 10 million electric vehicles on UK roads, and at least 30 million in the US. Left to their own devices, EVs owners have the potential to massively increase energy demand — especially if they decide to charge up their vehicles when the grid is already under strain. This poses a serious challenge to grid operators.

Smart technology, however, gives us the tools to overcome this challenge. Kraken is already enabling utilities and grid networks to shift EV charging to times that put the least strain on the grid. Beyond turning EV fleets into versatile “virtual power plants” (VPPs), this also unlocks excellent prices and seamless customer experiences for EV drivers themselves.

Additional revenue for competitive utilities

In deregulated energy retail markets such as the UK’s, enabling EVs to directly participate in grid-balancing mechanisms gives utilities access to valuable new revenue streams. In this case, the utility is rewarded for the service that they provide to the grid.

Unlocking value for integrated utilities

In vertically integrated markets, where grid balancing mechanisms can differ from the UK, related Kraken products still unlock huge value. By reducing peak loads and balancing costs, these services not only provide cheaper charging and excellent experiences to participating EV drivers — because grid balancing costs are distributed across all customers’ bills, they make energy cheaper for everybody.

Everybody wins

Integrating EVs into grid balancing mechanisms is a significant milestone in our journey towards greener, consumer-centric energy systems. The additional flexibility that products such as these afford helps to cancel out the potential for increased energy demand associated with EVs, reducing the need for expensive infrastructural upgrades. Customers get cheaper energy, utilities get increased revenue and a more resilient grid. Everyone wins.

[1] Forecasted EV usage is combined with a prediction of other household energy usage to give grid operators a clear view of what’s happening at the household meter level.

[2] Instructions to shift loads are set according to grid operators’ needs, taking into account energy prices and trading positions.