Dynamic Pricing, Advanced Metering, and Demand Response in Electricity Markets

Presents an overview and analysis of the possible approaches to bringing an active demand side into electricity markets. Part of a series of research reports that examines energy issues facing California

Harnessing electricity retail tariffs to support climate change policy

The 6th World Congress of Environmental and Resource Economists (WCERE 2018), Gothenburg, Sweden, 25-29 June 2018Legacy electricity retail tariffs are ill-adapted to future electricity systems and markets, particularly with regard to accommodating the multi-faceted shift toward decarbonisation. We examine how retail tariffs need to be reformed to not only meet the future revenue requirements of energy-suppliers and networks but also to help achieve the environmental objectives of the energy transition. While existing literature has explored the link between retail tariff structure design, wholesale markets and/or network cost recovery, there is less recognition of the impact of tariff structure design on environmental objectives. This paper reviews the demand responsiveness of household customers to electricity prices and implications of retail tariff structure and design for the policy targets of CO2 emissions, energy efficiency, and renewable electricity generation, in addition to electricity system. A review of the literature provides a theoretical basis for price elasticity of demand and electricity retail tariff design, and we explore the environmental implications for future retail tariff design options via examples of various tariff structures in the EU and US. The research links the topics of emissions mitigation policy and market design, and should add empirical insights to the body of academic literature on future electricity markets. It should also be of interest to policy makers wishing to consider retail tariff structures that promote decarbonisation of the electricity system through multiple objectives of improved energy efficiency and increased shares of renewable electricity within future electricity markets.Science Foundation IrelandEnergy Systems Integration Partnership Programme (ESIPP) UCDDepartment of the Environment, Climate and CommunicationsEnter two RePEc numbers if the item appears in more than one collection or series. Manually edit the resulting ReDIF file to include only one number and handle

Demand response in low-carbon power systems: a review of residential electrical demand response projects

The transition to a future low-carbon power system will increase the need for and value of demand response – where demand can be curtailed or shifted in time according to the network’s requirements. The electricity supply industry is investing heavily in ‘smart’ technologies, partly based on the assumption that demand response will be available when it is needed, yet this is an unfamiliar concept to most consumers, who still view electricity as a resource that can be consumed as and when they want it. That such a gap exists between the reality on the ground and the requirements of the future is a cause for concern, yet the methods proposed today to achieve demand response are based predominantly on assumptions that people will accept and respond to variations in the price of electricity. There is however growing evidence that the ‘people are economic actors’ approach is inadequate when dealing with the complexities of energy-use within the home. This paper reviews existing residential demand response projects, and supports the growing realisation that the principal challenge in demand response is no longer the technology itself but rather its acceptance and use by the consumer. In order to deal with this challenge, a more holistic approach to demand response is needed, one that can better deal with both the ‘hard’ and ‘soft’ sides of the system

Residential Demand Response using Electricity Smart Meter Data

The electricity industry is currently undergoing changes in a transitioning period characterised by Energy 3D: Digitalisation, Decentralisation, and Decarbonisation. Smart meters are the vital infrastructure necessary to digitalise the energy system as well as enable advancements in decentralisation and decarbonisation. As of today, more than 500 million smart meters have been installed worldwide, with that number expected to rise to several billion installations over the decade. Smart meters enable electricity load to be measured with half-hourly granularity, providing an opportunity for demand-side management innovations that are likely to be advantageous for both utility companies and customers. Among these innovations, time-of- use (TOU) tariffs are widely considered to be the most promising solution for optimising energy consumption in the residential sector, however actual use is still limited. The objective of this thesis is to investigate opportunities and problems related to TOU tariffs utilising smart meter data at the national level. The authors have identified four major research gaps which need to be filled in order to expand commercial applications of TOU tariffs. These gaps are the described and addressed in the following chapters: the "TOU load adaptation forecasting problem", the "TOU winner detection problem", the "TOU public dataset problem", and the "excess generation forecasting problem". This thesis demonstrates three modelling approaches and one new TOU dataset (CAMSL). A significant contribution to the field is through the discover of new summary statistical features (statistical moments) and assesses the capacity of these to encapsulate other more widely used explanatory variables of demand response. The thesis is concluded by discussing future works and policy implications, such as the necessity of the more tailored modelling works and public live-stream of smart meter data, which could accelerate the roll-out of the demand side management at the residential sector.EPC

Power system flexibility improvement with a focus on demand response and wind power variability

Unpredictable system component contingencies have imposed vulnerability on power systems, which are under high renewables penetration nowadays. Intermittent nature of renewable energy sources has made this unpredictability even worse than before and calls for excellent adaptability. This paper proposes a flexible security-constrained structure to meet the superior flexibility by coordination of generation and demand sides. In the suggested model, demand-side flexibility is enabled via an optimum real-time (RT) pricing program, while the commitment of conventional units through providing up and down operational reserves improves the flexibility of supply-side. The behaviour of two types of customers is characterized to define an accurate model of demand response and the effect of customers' preferences on the optimal operation of power networks. Conclusively, the proposed model optimizes RT prices in the face of contingency events as well as wind power penetration. System operators together with customers could benefit from the proposed method to schedule generation and consumption units reliably.fi=vertaisarvioitu|en=peerReviewed