From energy consumer to active grid participant: ancillary services for industrial plants
For decades, the energy paradigm of the manufacturing industry remained unchanged: companies acted as passive entities, drawing energy from the grid and absorbing its cost fluctuations.
With the evolution of Smart Grids and the need to integrate increasing shares of non-dispatchable renewable sources, this scenario has changed. Today, through ancillary services for industrial photovoltaic systems, energy-intensive plants have the technical opportunity to evolve into active nodes of the power system.
This does not only mean self-production, but also enhancing the flexibility of assets to participate in the Ancillary Services Market (MSD). However, access to these opportunities requires a rigorous assessment of technical requirements and the company’s consumption profile.
Table of contents
Beyond self-consumption: what UVAMs are and access requirements
To ensure frequency stability (50 Hz) and voltage levels, Terna must balance production and consumption in real time. The market has progressively opened to distributed resources through the introduction of UVAMs (Mixed Enabled Virtual Units).
But what are UVAMs from an operational perspective?
They are aggregates of generation units (such as photovoltaic systems), storage systems and flexible industrial loads which, when managed by an aggregator (BSP), are seen by the grid operator as a single virtual power plant.
A company in the paper or steel sector can join a UVAM by declaring its availability to vary injected or withdrawn power. It must be clarified that not all systems are eligible: participation is subject to compliance with technical and regulatory requirements (such as the ARERA compliance requirements for photovoltaic systems over 100 kW), as well as real-time monitoring systems and the ability to respond to grid commands.
The dispatching market for companies: enhancing flexibility
Access to the dispatching market for companies (MSD) introduces a management logic that goes beyond simple energy bill savings. It is about remunerating energy flexibility.
Unlike production incentive mechanisms, companies are rewarded here for their ability to adapt. There are two potential revenue streams:
- Capacity payment (Availability): a fixed remuneration granted for keeping power reserves available during critical time slots, regardless of actual activation.
- Energy payment (Activation): when Terna requests intervention, the exchanged energy is remunerated at prices reflecting the urgency of balancing, often higher than standard PUN values.
Actual economic convenience must be assessed case by case, matching fixed management costs (e.g. BSP fees) with the statistical probability of activation in the relevant market zone.
Earning with storage for industrial photovoltaic systems: the role of energy storage
The main concern for any Production Manager is interference with industrial cycles. To mitigate this risk, the enabling element is often electrochemical storage.
Aiming to earn through storage for industrial photovoltaic systems (or more precisely, to optimise investment payback through grid services) is the preferred strategy for continuous-process industries. A BESS (Battery Energy Storage System) decouples grid requests from production activity: when Terna asks to reduce grid withdrawal, the battery discharges instead, leaving machinery power supply unaffected.
The Southern Italy context
For companies located in Apulia and Basilicata, company participation in Terna’s MSD market has specific technical relevance. In these areas, the high concentration of renewable sources frequently creates node congestion and voltage regulation issues. As a result, the need for flexibility resources (and therefore the opportunity to valorise them) is structurally higher than in less saturated market zones.
Preliminary technical assessment
Access to ancillary services is not standardised and requires an in-depth analysis of the load profile, grid zone and installed technology, starting from the correct choice of the technical partner for industrial photovoltaic systems.
South Energy supports companies through technical audits to verify UVAM integration feasibility and estimate the actual economic potential.
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FAQ – Frequently Asked Questions
No, if properly planned. Participation in the MSD market is voluntary: companies (via the BSP) offer availability only when compatible with production schedules. The use of energy storage systems almost completely eliminates interference with plant loads.
It is not a regulatory requirement, but it is often a de facto technical and economic prerequisite for manufacturing industries. Without storage, companies would need to directly modulate machinery loads (demand response), which is complex in rigid processes such as glass or paper production. A BESS provides the “pure flexibility” required by the market.
The company does not interact directly with Terna. The BSP (Balance Service Provider) is the third party that aggregates resources, manages the technological interface with the grid and assumes balancing responsibility towards the system. Selecting a reliable BSP and clearly defining profit-sharing rules are critical steps.
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