Energy Transition Handbook - Flipbook - Page 47
Energy Transition Handbook 2021
Demand side response
Demand side response (DSR) refers to the increase or decrease of power consumption
in response to price or regulatory signals. It broadens the toolkit available to network
system operators by allowing them to modulate electricity demand as well as electricity
supply to balance the network.
DSR is an important tool to help ensure a secure,
sustainable and affordable electricity system
by softening peaks in demand and filling in the
troughs, especially at times when power is more
abundant, affordable and clean.
It is increasingly importance in a multi-directional
energy system where power no longer simply flows
from large generation plants onto the high-voltage
transmission network, through the distribution
network and to consumer. In mature economies,
electricity markets are increasingly flexible with
significant electricity demand being met directly
by distribution network connected renewables or
behind the meter generation and energy storage.
To be effective, DSR relies on price or regulatory
signals incentivising behaviours that contribute to
system efficiency, lowest cost and lowest carbon
footprint. In many markets, system cost allocation
was not designed for the operation of the current
more agile electricity system. That has led to
opportunities for arbitraging and avoiding system
costs, for example, by load shedding at times of
system peak. This has led to calls for system cost
allocation reform.
For business and consumers, DSR is a smart way
to save on total energy costs and reduce their
carbon footprint. DSR enables businesses to save
on use of system costs as well as generate income
by reducing or shifting consumption or switching
to on-site generation when asked to do so by the
DSR partner and/or system operator. It can also
involve increasing consumption at times when the
system has too much capacity. There are various
ways for businesses and consumers to participate,
from flexing operational processes to utilising onsite generation or battery storage.
Historically only available to the largest energy
players, DSR is now opening up to business
consumers and small generators with the role-out
of smart meters and smart devices is making DSR
easier than ever for domestic consumers.
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