Utility Week

UTILITY Week 3rd July 2015

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UTILITY WEEK | 3RD - 9TH JULY 2015 | 25 Customers engage the industry in order to "co-create" the framework needed to develop a demand- side market by removing "real and perceived barriers" and providing education on how to take advantage of measures already in place, O'Hara said. The direction of travel is clear. Holliday says: "It's about delivering real-time signals to energy users, and giving them the means and the motivation to act on those signals. In effect, it's about saying to customers, 'Do you really want to use this much electricity, at this cost, right now?' "Simply by delivering those signals, and providing alternatives, we turn an arcane industry problem into a customer opportu- nity. We enable customers to take greater control of their energy bills, and provide tools to make it easy." Communicating the benefits will be key. "It gives customers – from domestic right through to industrial users – more insight and therefore more control. Everyone can benefit and everyone has a role. DSR also helps to reduce costs across the energy supply chain. It improves security of sup- ply. And, by enabling everyone to make better use of alternative energy sources, it contributes to carbon reduction," Holliday explains. Beyond the next five to ten years, house- hold consumers will be able to reap these benefits too. Shiing DSR from an I&C con- cern across all energy consumers is vital, says Association for Decentralised Energy (ADE) director Tim Rotheray. "Demand-side response will begin in the industrial, commercial and business areas and that's where it should start. Firstly, because in these areas you are dealing with larger energy loads. And also you're dealing with customers who are more engaged with their energy use. But this is a development that should absolutely move to household consumers too because – as with the busi- ness users – these are consumers who are paying for the energy system so they should absolutely have the opportunity to partici- pate and reap the same benefits," Rotheray says. But again, education and communication is fundamental. "The most important thing is to be clear about the information. What we're talking about is a change of behaviour so that the consumer is in control of their own energy use," he says, dismissing tabloid scare stories of government-controlled fridges. "It's not about having your energy use controlled by the government or any cen- tral body, it's about the consumer choosing their energy future by managing their own demand. It's market offering. This could be as simple as enabling your smart phone to engage with market price signals while you determine what you need to do now and what could wait until later. Do you need to charge your devices now or can you wait until the middle of the night when prices are lower? Or maybe when the sun is shin- ing and there's plenty of solar power in the system?" The UK's demand-side energy sector will have a more unified voice following the merger of the Association for Decentral- ised Energy (ADE) and the UK Demand Response Association (UKDRA) in a bid to "create a strong singular voice" for the sec- tor by joining efforts under the ADE banner. "These two associations are linked by their vision of an energy system that starts with the customer," said ADE director Tim Rotheray. "The UKDRA has had a key role high- lighting the value of managing demand, rather than building more power sta- tions, to meet our energy needs. By bring- ing these two organisations together, we will strengthen the voice for a more cost- effective, less wasteful, low-carbon energy system that puts the customer at the centre," he said. UKDRA director Sara Bell added: "With increasing focus on how we can use our energy resources more efficiently, now is the opportune time to present a united voice that will not only benefit the demand- side sector, but all energy customers." NEWS Trade group merger to bolster DSR voice Reaction " Rotheray: 'strengthened voice' THE SUPPLIER: RWE Npower head of business solutions technical services, Tony Slade National Grid needs to do more to drive the commercial incentive for business to engage with demand- side response. By negotiating a new supply deal, a customer could drive down its costs from £100/MWh and save maybe £2/MWh. But if it invests in energy efficiency and cuts that MWh of demand entirely, it's saving £100. A huge amount of decentral- ised generation is still untapped – Citibank alone has about 10MW of UPS capacity and 7MW of backup capacity. Multiply that by every bank and every data centre and you can get some idea of the capacity currently untapped. The potential is huge." THE AGGREGATOR: Pearlstone chief executive Azad Camyab We go to our clients and install the necessary tech and management systems at zero cost and then we access, aggregate and sell the flexible load into the market at the best price at different times of the day, week and year – and share the benefits with our clients. You've got a virtual power plant of [demand] avoidance; so what do you do with that? As of this year we can sell that to the National Grid and monetise through the wholesale trading mar- ket. And it has a very low marginal cost so it's very competitive compared to diesel and gas generating assets." THE USER: Warwick University utilities projects engineer Andrew Leeson Warwick University has 8.6MW of generation capacity on its campus and has been investing in combined heat and power since 2001 when the first unit was installed. Since then the university has invested more than £14 million in an energy centre to provide the campus with power and hot water through a district heating network. For us, demand-side response is a commercial opportunity. We're in a position to sell our excess power because at peak our demand is 9MW. What we'd like to see now is more clarity on how the different DSR schemes can work together." " "

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