Demand Response

Success case

Fluctuations in energy consumption play an important role in energy costs and emissions. This and maintaining security of supply make it paramount to balance energy production and consumption. Traditional power plants ensure this by employing automation or professionals in the control room to make sure that the level of production matches the level of consumption. In Demand Responce system, whenever consumption peaks, power plants simply ramp up the production.

To solve the problem, Empower IM, Elenia, There Corporation, Helen, Fortum, LUT, TUT and VTT set out to build Demand Response - a complete solution that would enable energy consumption to follow market signals, making previously static metering points behave in an active way. To put it simply, Demand Response seeks to shift consumption away from peak times in a controlled way with minimum intervention in order to balance the electricity distribution system and reduce the need for increased energy production.

Demand Response is highly beneficial especially for maximizing the benefits of renewable energy generation because it adjusts consumption to the fluctuations in generation associated with renewable energy like wind and sun. Since there are practically no marginal costs for producing solar and wind energy, Demand Response enables the full use of this energy at all times and allows us not to limit solar and wind production.

Demand Response also allows for better planning of interim production for small and medium sized industry sites. For example factories that produce an interim product like sawdust for particle boards can reduce the cost of the final product by shifting production of sawdust towards the night, when energy demand is smaller and therefore cheaper. Thus, Demand Response would help shift interim production based on market information with less overhead than before. As a result, options previously open only for large market players are opened up for smaller companies.

Demand Response combines everything, from metering points to electricity suppliers and all the parts in between, into a complete value chain. To facilitate such a system, one needs to measure consumption, control it and ideally automate the responses so that whenever there is a market signal the system underneath the infrastructure effectively responds and activates SGEM Demand Response.

Creating a solution like this has been discussed in the academia and energy industry for years. The Smart Grids and Energy Markets (SGEM) program has enabled the team to develop a concept that can be used in the real world of dynamic energy markets, distributed roles and large numbers of customer sites.

Without the SGEM program it would not have been possible to create this kind of holistic solution where actors come together. One needs suppliers, distribution networks, equipment manufacturers, information system suppliers, research institutions and communications solutions providers.

Demand Response is most beneficial on the market- and national-level scope. Implementing it into energy systems would enhance planning and implementation of the balance in production and consumption. As a result, the market would not need to provide as much transmission capability as it does today and national capital tied-up in reserve energy resources could be diminished.

Automated Demand Response processes can also benefit smaller industries through aggregation and single-site installation. It can also be applied in even smaller metering points like homes. For instance, Empower IM together with There Corporation are developing a device that would enable shifts in household’s energy consumption based on the market signals to deliver efficient heating or air conditioning with less emissions.

The team behind Demand Response described it as the key to make full use of renewable energy resources that would become the backbone of production in future energy ecosystems. Demand Response enables us to achieve balance in the electricity system that is otherwise impossible without limiting the production of renewable resources.

Demand Response

For more information: SGEM Program Manager Jani Valtari (ABB), jani.valtari@cleen.fi