This week’s Startup of the Week is an independent, digital energy service provider and optimiser for electricity and natural gas. ES∙FOR∙IN enables customers to take advantage of opportunities for energy turnaround on the energy exchanges in milliseconds. How? By focussing on individual flexibility marketing of electricity. We wanted to know more about how this works exactly and spoke to Christian Hövelhaus from ES∙FOR∙IN.
Hello Christian, thank you for answering our questions today. Let’s start right away: How would you explain ES∙FOR∙IN in one sentence?
We are the future-oriented optimization platform for electricity and gas in European markets.
Sounds exciting! Could you elaborate further on how you are doing this?
We focus on innovative flexibility marketing of electricity on the consumer and generator side. With over 2.2 million intraday trades in 2020 on EPEX Spot SE, the company is the leading provider of flexibility marketing in the power sector.
Tailor-made solutions enable energy-intensive and producing companies to adapt their power flexibility to the price signals of the intraday markets on EPEX Spot SE. In addition, ES∙FOR∙IN is a direct marketer focusing on biogas/biomass power plants, enabling highly flexible plants to earn additional profits through flexibility marketing on the intraday markets. In summary, ES∙FOR∙IN is THE future of innovative and smart flexibility marketing in short-term energy trading.
Price signals indicate an imbalance in the power grid and ES∙FOR∙IN algorithms respond as a service on behalf of our customers. In this way, we help to stabilize the grid and actively contribute to the energy transition.
What makes you stand out from your competition?
The energy transition is increasing the importance of flexibility provision. So far, the required flexibility is mostly covered by the supply side, while the demand side is almost neglected. Therefore, the most important distinguishing feature of ES∙FOR∙IN is the flexibility marketing on the demand side as well as on the supply side.
Another key differentiator is our asset-specific trading algorithms, which can be adapted to any flexibility option. In addition, the entire flexibility marketing process is fully automated, coordinated and optimised – from the transmission of the flexibility restrictions via the web portal or the user-specific API, the trading on EPEX Spot SE, the control of the flexibility by a specially developed remote control technology or the schedule transmission via the user-specific API to the final settlement. We have thus created our own system with a focus on flexibility marketing that runs independently 24 hours a day without human intervention.
Another major differentiator of our flexibility marketing on the intraday markets of EPEX Spot SE is the unparalleled profitability (up to 85,000€/MW per year!) – in contrast to highly regulated control power. In particular, there is no need for prequalification of the different flexibility options. Moreover, the control commands are predictable and last at least 15 minutes.
Could you explain how your business model works?
The exchange electricity price on EPEX Spot SE is to be seen as a central control signal for the trading participants to balance supply and demand in the wholesale electricity market and thus also in the grid. Balancing supply and demand in the grid leads in the long term to a lower need for grid as well as generation expansion with new lines or routes through the country. Flexibility options are used to economically optimize the electrical energy needs of consumers. When exchange electricity prices are low, consumers buy more energy. When prices are high, consumption is reduced. Conversely, electricity producers will increase production when prices are high and reduce production when prices are low. These responses to price signals always occur within all plant-specific constraints.
In the future, the need for flexibility options will increase with the number of distributed generation plants due to the feed-in characteristics of renewables and the resulting forecast accuracy. Electricity generators and consumers will be encouraged to adjust to the feed-in of renewables and thus support the negotiation of forecast errors by passing on electricity price signals. In this way, we reduce customers’ energy costs while stabilizing the power grid and promoting the energy transition.
As a full service provider, further services include balancing-group and portfolio management, direct market access for electricity and gas for industrial companies, and market-communication services.
You already mentioned the consumer side being an important factor in the design of your services. What is your target market?
Yes, ES∙FOR∙IN is a highly automated flexibility marketer for the generation and consumer side. The value of flexibility is determined by the response to price signals – the different offers and demands of electrical energy on the continuous intraday markets of EPEX Spot SE.
Our solutions enable energy-intensive and manufacturing companies to respond with their electricity flexibility to price signals on the intraday markets. These markets are designed to meet the needs of utilities and balance imbalances between electricity supply and demand.
The target group of customers are industrial companies, flexible biogas plants, energy suppliers as well as coal and gas-fired power plants. In the future even energy sales and distribution companies with thousands of households as prosumers will be our target group.
Where are you standing now? What are big milestones that you like to look back on?
ES∙FOR∙IN is a fast-growing company – nationally and internationally. With more than 2 million fully automated intraday trades in 2020 on the power exchange EPEXSpot SE, we are already the leading provider of flexibility marketing for power and pioneers in flexibility marketing for gas. We have developed more than 50 individualised trading algorithms and unparalleled expertise in algorithmic intraday trading of power as well as algorithmic intraday trading of gas. In addition, we are continuously developing new products to identify new flexibility options and provide our customers with additional revenue.
Christian, thank you so much for this great interview! It was a great opportunity to get to know ES∙FOR∙IN and its services. We wish you continued success and look forward to hearing more about your development.
If you want to know more about ES∙FOR∙IN and what they have to offer, check out their Innoloft profile for more information.