As Urban Reserve marks a major milestone with its first flexible electricity facility going live, we are reflecting on the business’ impressive growth to date. We interviewed Aidan Morris, Head of Connections and Delivery, and Ben Wallace, Head of Development at AMP Clean Energy, about how they turned a concept into a market leading business in just 18 months.
Urban Reserve, which delivers flexible electricity in our busiest urban and commercial areas, supports the intermittency of renewables and our growing energy needs in the transition to net zero. To date, 29 projects have received planning consent with 19 in the delivery phase.
How did the concept of Urban Reserve come about?
When I joined AMP Clean Energy in 2017, we were developing large peaking plants and actively looking at finding more sites to do so. This was part of the business’ overall vision to provide flexible energy which supports the growth of intermittent renewables.
However, at that point the capacity market was very low, so the challenge was how to develop a pipeline of successful projects without the capacity market. We decided to look at developing much smaller peaking plants – around 2 to 4MW – and that set the parameters for us. In September 2018 Urban Reserve was born.
It was a pioneering idea, led by our CFO Mark Tarry, to develop a portfolio of smaller flexible electricity peaking plants. In busy areas you can’t build wind farms or large power stations, you need a flexible generation with a small footprint. You can build a 2.5MW Urban Reserve in the size of one shipping container. For the equivalent solar capacity, you would need ten acres.
The beauty of the smaller sites is that they can generate power in just under two minutes. With a lifespan of 30 years, these plants will operate for between 1,500-2,000 hours per year.
How do you develop and deliver an Urban Reserve project?
In summary the development process involves finding land, engaging landlords and submitting planning, gas and connection applications. We’ll also work with our supply chain to get the optimum design. Once we have planning, we hand over to Aidan to oversee delivery and connections.
There’s a big overlap between development and delivery in the early stages. Ben can find what looks to be a suitable site but if we can’t develop a plant viably due to the cost of making the gas or grid connections then it stops there. Understanding the buildability of the site is also key.
At the point of financial close I appoint a contractor to build the plant but we also project manage the developmet from our side. It is really important that we liaise with the relevant Distribution Network Operator (DNO) throughout to ensure the grid connections are ready at the right time.
What are the main challenges you face in developing an Urban Reserve facility?
Urban Reserve sites are most often in quite small, insalubrious locations. Persuading people that these little, often dirty corners of industrial estates were both valuable and important to local energy networks was a challenge – no one really ever believed us!
Each site comes with its unique set of challenges and we have to be adept and responsive at dealing with them. I’ve worked in this field for 15 years and I’m still coming across issues I’ve not faced before. For example, I found out that one of our Urban Reserve sites was on a landfill!
The design and technical specifications we wanted for the plants were unique to Urban Reserve. It wasn’t a case of buying a standard plant off a shelf. No one had integrated our preferred power units, switchgear and control system as a package in the way we wanted to, so in that respect we pioneered the design. Obviously, in doing this you have a lot of teething problems, but you learn from that and apply that learning to every subsequent plant you deliver.
What are your major learnings from the last 18 months?
You need to actually eyeball a site from a delivery perspective to ensure that there aren’t any issues that you have missed. No matter how many times you look at a site on Google Earth or at photos it is not the same as going and seeing for yourself. The development team find many sites which they think are diamonds in the rough, but they all need polishing in different ways.
We have looked back and realised we underestimated how long a project would take to deliver. Just because the sites are small, they require no less rigour than much larger plants. We’re learning all the time and quality and continuous improvement go hand in hand going forward.
There is no project that doesn’t have its challenges and perseverance and problem solving is the key to success! In the last two years, we’ve looked at around 15,000 sites to develop Urban Reserve plants but only 30 – 45 projects will come to fruition.
How has the Urban Reserve team grown during the last 18 months?
We’ve expanded the development team and appointed the first Urban Reserve Development Manager, Caspar Ruane, in September 2018. The team’s growth has been a reflection of the speed we’re working at and our confidence in the end product. I’m very proud of the fact that whilst we are a small team, we are making an impressive impact on the flexible electricity market.
We’re still pretty small but we’ve almost tripled in size. We were initially outsourcing the management of the connections, including liaising with the Distribution Network Operators (DNO), a key stakeholder for Urban Reserve. We now have our own project managers as we decided it was better to manage the connections in-house, build relationships and ensure business continuity.
What has been your biggest highlight of your time in Urban Reserve so far?
Being on site the first day that power units were lifted on to an Urban Reserve site at Romney Warren was pretty special. Another moment which stands out for me was the first synchronisation of an Urban Reserve generator with grid – this marked the point at which we truly became a flexible generator.
The fast pace of development and delivery means there is never a dull moment!
Working in a strong, focused team with a common sense of purpose to achieve well defined objectives is a real bonus.
There have been several. Gaining the first planning consent, signing the first lease with a landlord and the first plant becoming operational in Kent, were all landmark moments. What has been very rewarding is to have been seen Urban Reserve develop from the initial concept to meeting each milestone to the plants now becoming a reality.
How important is flexible electricity in the transition to a net zero future?
Transitional technologies such as natural gas peaking plants will be critical to meeting growing energy demand and supporting the intermittency of renewables. As we use more renewables, the grid will need to be supported by reliable and low carbon flexible energy to fill in the gaps when the wind doesn’t blow, and the sun doesn’t shine.
One thing we know for sure is that demand for electricity is only going to grow so there will always be a need to balance the grid. Of course, we don’t know how much longer we will use gas for or when hydrogen gas will become more viable. Batteries will almost certainly play a bigger role in the future of flexible energy generation too.
What are your aims on the next chapter of Urban Reserve?
We’ve got a lot of sites still in the delivery phase and we are still looking to develop more. In Urban Reserve, we have created a model which is scale-able and repeatable and technology wise the next logical step would be to develop battery plants. Batteries are super-fast acting providing they are charged so will likely play an important role in helping balance the grid.
As Aidan said, we may move on to different technologies that support the transition to a net zero future, and I think we are all looking forward to the new challenges that will present.