In Belgium, the European Network of Transmission System Operators for Efficiency (ENSTO-E) has in November issued a white paper discussing region’s market design options for demand side response (DSR).
The release of the paper is ENSTO-E’s contribution towards the EU Energy Commission led on-going discussion on the integration of DSR in all electricity markets.
The report highlights current DSR landscape, constraints being faced and benefits of further developments.
ENSTO-E believes increased adoption will result in further reduction of energy costs for consumers, flexible grid systems, and increasing competition to the market.
However, the report mirrors out six key requirements Europe need to address in existing DSR models to unleash the potential development and efficient use of DSR.
The report suggests that:
- Price signals reveal the value of flexibility for the electricity system.
- Consumers be exposed to variable prices as efficient use of DSR is based on an economic choice between the value of consumption and the market value of electricity.
- Access to price information, consumption awareness and DSR activation require strong consumer involvement, which can be facilitated with automation or by delegating the DSR process from the consumer to a company.
- Regulatory barriers, when present, need to be removed to unlock full DSR potential, including barriers related to the relationship between independent aggregators and suppliers.
- Communication and control technologies need to enable DSR for small consumers and provide guarantees on their reliability.
- DSR should develop itself based on viable business cases.
Furthermore, ENSTO recommends that countries individually integrate DSR in energy markets and select market models driven by cost benefit analyses accounting for local context elements including economic efficient, competition and fairness.
ENSTO predicts DSR participation in reserves capacity markets will unlock the economic benefits if it features a high level of reliability including data management and security requirements.