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Molten Metal Equipment Innovations
Firm Frequency Response involves generation or removal of sufficient electrical load from the grid to stabilize frequency. The grid rewards the participants because it has an obligation to ensure that sufficient generation and/or demand is held in automatic readiness to manage all credible circumstances that might result in frequency variations.

Switched On to a New Revenue Stream

Aug. 12, 2016
An induction-melting “foundry” adopts 'power balancing,' and the revenue flows in Promoting “intelligent energy usage” Managing hardware, software installation, monitoring and reaction Paid to participate

United Cast Bar Limited calls itself a foundry, but by most standards its operations also qualify it as a steelmaker: it produces continuous-cast iron bars for distribution through its own network of warehouses in Europe, the Mideast, and Southeast Asia. It was formed in February 1998 by the merger of three similar “foundries,” two in England and one in Spain, and its Chesterfield, England, plan is now producing 45,000 metric tons/year of continuous cast iron bar products. What it shares with every foundry is its need to optimize energy costs.

United Cast Bar is benefitting from its adoption of Firm Frequency Response (FFR), a revenue generating scheme that is part of National Grid Plc.’s Demand-Side Response (DSR) program — a business-focused package that promotes “intelligent energy usage” to save on total energy costs and reduce carbon emissions by increasing, decreasing or shifting electricity consumption. Examples may include adjusting the use of lighting, heating, ventilation and air-conditioning, back-up or distributed generation, pumps, motors and compressors, and other manufacturing processes.

Unibar’s FFR program was developed by Endeco Technologies, an “aggregator of smart grid optimization solutions,” which reports the implementation is yielding revenue increases for the foundry, and predicts those increases may rise further in the future.

Unibar produces 25- to 700-mm round bars, square bars up to 550 mm, and sections up to 750 x 550 mm, all by continuous casting, and all for distribution. Approximately 90% of its output is exported, 80% to EU countries.

While the business model is a success, Unibar managing director was intrigued by the possibility of additional revenue: upon learning a bit about FFR he decided to investigate its applications to his manufacturing operations. “We are members of the Cast Metals Federation and I recall seeing some posts on LinkedIn relating to FFR,” he explained. “I dug a little deeper and it seemed like a good way for United Cast Bar to earn extra income in a manageable format.”

High rewards — In simple terms, FFR involves generation or removal of sufficient electrical load from the National Grid to stabilize frequency. The Grid (a private electrical and gas utility operating in the U.K. and Northeastern U.S.) is prepared to pay such high rewards because it has an obligation to ensure that sufficient generation and/or demand is held in automatic readiness to manage all credible circumstances that might result in frequency variations. To ensure the success of such schemes, the National Grid offers those that participate the potential to earn extra income from assets by automatically adjusting power consumption in real-time.

Financial and operational benefits

The financial and operational benefits for participating companies can be very significant, with returns of up to £70,000 (est. $90,000) achievable for every megawatt (MW) of average onsite energy consumption saved. This is in return for around six (on average) ‘turn-down’ events per year, each one lasting for a maximum of 30 minutes.

“The opportunity to earn sums like this for a controlled risk meant I was prepared to take it to the next stage, and the CMF put me in touch with Endeco Technologies,” Brand said. Endeco made a site visit to the foundry, and after further discussions with the management there decided to initiate the FFR process.

Optimized returns — Endeco Technologies is a National Grid approved aggregator that can help businesses like United Cast Bar to make effective energy choices and optimize returns. In addition, it manages the necessary hardware and software installation, as well as the online monitoring and reaction systems, and the day-to-day running of the system. All of this is provided without any capital investment requirement, with the aggregator simply taking a share of the scheme payout instead.

“We agreed a certain amount of contract flexibility with Endeco Technologies, including our preference to amortize the hardware and software over the first two months,” Brand explained. “This meant that by the third month we would be generating the full income.” 

It was decided that United Cast Bar’s two main induction-melting furnaces would be suitable assets to shut down during an FFR event. Melting is the most energy-intensive process at any foundry and it was estimated that this would provide an average available load of 1.972 MW for the FFR Service. On receiving a control signal, the melt furnaces will be turned off within 10 seconds. After 30 minutes, Endeco’s platform will release the control signal and the furnaces can be restarted automatically following the required sequence.

“For peace of mind, we contacted Inductotherm Ltd. (which designed and installed the furnaces), who came in to check that their equipment would be compatible,” Brand said. “If we don’t have our melting furnaces we might as well close the business, so it was imperative we explored every potential for problems. However, Inductotherm gave us the all clear and we happily moved forwards.”

Monthly payments — The installation of the system hardware and software was successfully completed early in 2016 and United Cast Bar went live in February.

“Interestingly, we have not yet had an FFR event,” according to Brand. “Clearly, I’m not complaining about this as the scheme dictates that we continue to receive our monthly payments regardless, simply for scheme participation.

“However, I’ve been made aware that FFR occurs only around five or six times a year on average, which we can live with,” he continued. “If the power is cut on our melt furnaces for 30 minutes we simply lose a few degrees of temperature. It won’t take long to make this up upon restart. In addition, we have a manual override option if for any reason there is a health and safety issue or other concern.”

United Cast Bar has been receiving monthly FFR payments. As a result, annual revenue is in line with original forecasts set out by Endeco, although Brand said this could rise in line with any increase in production volumes.

“There are other benefits too,” he added. “For instance, Endeco has created a personalized optimization dashboard that presents data such as energy consumption, which is great for our own energy and asset management plans.”

Future-proof solution — Another important reason for selecting Endeco Technologies was the offer of a “future-proof” platform. As response schemes are always likely to change over time, participating companies must be technology-ready to access more financially attractive tariffs. The company is the only aggregator able to offer all National Grid DSR schemes, and its technology platform makes switching a simple undertaking. Indeed, over 100 sites moved from FCDM (Frequency Control by Demand Management) to FFR overnight when the latter scheme was released by the National Grid in July 2015.

“It’s still early days but I know Endeco’s team is currently busy generating a usage profile for United Cast Bar, and it may be possible to get even more return from other schemes in the future,” Brand concluded. “It’s good to know we’re in safe hands.”