Demand-side response: Water firms, retailers, industrials give their verdict

Free 2019 demand-side response report
Free demand-side response report

Firms helping to balance the power system via demand-side response (DSR) say they could provide significantly more flexibility – given sufficient reward and revenue certainty.

Meanwhile, most companies that do not provide DSR would consider doing so – if it did not impact day-to-day operations.

The findings, from a survey conducted by The Energyst, come as National Grid ESO recommends reviewing security of supply standards to determine whether they require strengthening – and whether further reserves may be needed.

The survey findings are contained within the 2019 DSR: Shifting value report.

Respondents – including water companies, retailers, large industrial firms, transport companies and universities – provide an up-to-date snapshot of the DSR market and the challenges and opportunities it presents.

DSR providers:

  • Six in ten could offer more flex without affecting business
  • Insufficient rewards and revenue uncertainty main reasons for not doing so
  • Triad avoidance most popular activity, then frequency services and CM
  • Eight in ten providers would consider 15-year CM contracts (caveats apply)
  • Four in ten still using diesel back-up BTM for DSR/peak charge avoidance
  • Six in ten satisfied with DSR overall, down from almost nine in 10 in 2016

Non-DSR providers:

  • Almost nine in ten interested in providing DSR … if no disruption
  • Most have some form of onsite generation, solar most popular
  • Two thirds not yet approached by service providers re: DSR

Battery storage:

  • Interest remains high; almost six in ten are considering investment
  • Of those, six in ten plan co-location with other assets, mostly behind the meter
  • Seven in ten view peak charge avoidance, incl. Triad, as part of revenue stack

The demand-side response report contains qualitative interviews with companies that provide DSR on the challenges and opportunities presented.

We also polled and interviewed organisations that do not provide flexibility – but would do so if simple, low cost solutions were put to them. These include local authorities, manufacturers, airports, universities, restaurants, hotel and pub chains, plus a broad range of SME and mid-market firms.

The report includes interviews with:

  • DNOs on the direction of travel for local flexibility
  • Suppliers, aggregators and consultants on where value might be headed
  • Elexon on European market Terre and wider access to the Balancing Mechanism
  • The Environment Agency on the Medium Combustion Plant Directive

Thanks to sponsors Power Responsive, EDF Energy, Enel X and UK Power Networks, the report is available as a free download.

Download your copy here.

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