Skip links

What is Frequency Containment Reserve?

The electric grid is the most vast and complex piece of infrastructure ever created by mankind. Every electric device is connected to this system: your computer, phone charger and your fridge are all supplied with much needed energy through this network. Yet, not many people know what is necessary, day in day out, to make this system work.

By Melchior Langeveld.

The grid: pushing & pulling

Today the energy we use is generated by large industrial coal and gas fired turbines which rotate very large magnets to generate electricity. Much like an ordinary dynamo on your bike; instead in power plants, the magnets are turned by burning coal and natural gas instead of calories. But how is this electricity transported? Most electrical grids work with alternating current. This means that the current continuously varies between positive and negative values. In essence electrons are pushed in one direction in one instant, and in the next, they are pushed in the opposite direction. This is a logical consequence of the rotating magnets we just mentioned. These magnets rotate at exactly 50 times per second! Thereby pushing and pulling electrons through the grid, powering your machines.

Frequency: A Tug of War

The pulling and pushing process of the magnets can be seen as a tug of war between power plants and the energy consumers. The more people use energy, the more power needs to be delivered. Thus, the frequency of this alternating current is not only determined by the number of rotations of these magnets. It is also determined by the energy demand on the grid. Large imbalances between the amount consumed and the amount produced can result in the system collapsing. But how does the grid operator know if the system is in balance?

50 Hertz

If the frequency as measured on the grid starts deviating from the 50 Hertz, the grid operator knows this is caused by such an imbalance. Is the frequency greater than 50 Hertz, there is an excess of energy production. Is the frequency lower than 50 Hertz, there is a shortage of supply. Of course grid operators are keen on ensuring the grid does not collapse. To ensure this balance, the transmission system operator (TSO) needs to influence the amount of energy supplied (or taken) from the grid. And this is where frequency containment reserve (FCR) comes into action.

Frequency Containment Reserve: now and in the future

Frequency containment reserve is a production capacity (or any other machine) that is reserved for reducing or increasing its energy output to contain any possible frequency deviations. This reserve needs to respond really fast and very accurately. Because of these harsh requirements not many machines can invest in the necessary control technology to deliver this service. This naturally resulted in predominantly coal and gas turbines providing this service. These assets are going to be phased out due to the energy transition. New technologies for the provision of this service need to be developed. Senfal is looking at combinations of various sustainable asset types to deliver this service. Assets such as electric vehicles, batteries and wind turbines.

The Frequency Containment Reserve market

On an European scale the TSO’s have decided to set up a shared market for selecting the assets that deliver the FCR they need. Assets that are able to quickly and accurately alter their energy output in response to frequency deviations. Suppliers first have to run extensive tests to prove they are able to meet requirements. Once successfully completed they can bid into the shared or local market, or go into a bilateral agreement with the TSO.

How to profit from your energy asset

Batteries, like the Tesla Powerwalls, are very suitable for providing FCR. Last year in Germany 180MW of battery capacity was commissioned, predominantly to supply this market. Prices have been volatile, but still mostly remain above €2000,- / MW reserved. The graph below gives an overview of the FCR prices in the shared European market. Thus, when possible, FCR is a good way to use batteries, charge points and other energy assets. This way sustainable assets can be used to balance the energy grid, and it gives asset owners a way to profit from the energy they generate.

Frequency containment reserve, FCR, prices, graph

FCR prices graph