Abstract
To support decision-making about the implementation of demand response, insight into the prospects and value creation is essential. As the potential benefits are diverse and distributed amongst various power system stakeholders, a system perspective is necessary for their assessment. This paper describes a methodology to model the long-term demand response benefits from a system perspective. To quantify the benefits both the energy market value and the grid value are assessed. In a liberalized power system these benefits can generally be assigned to the two main electric utilities, i.e., the energy supplier and the grid operator. The applicability of the developed approach is demonstrated using the Netherlands as a case study and a model developed from actual data from the Dutch power system. Within this model, different demand-response strategies are implemented to shape the flexible future load available for residential areas. The potential benefits of the following demand-response strategies are quantified: grid based, energy market based and energy market based with capacity constraints. The results show that from a system perspective, a demand-response strategy that is energy market based with capacity constraints is most effective in terms of realizing system benefits from residential flexibility.
Highlights
As a consequence of the energy transition, the traditional power system faces several challenges
In a liberalized power system these benefits can generally be assigned to the two main electric utilities, i.e., the energy supplier and the grid operator
The results show that from a system perspective, a demand-response strategy that is energy market based with capacity constraints is most effective in terms of realizing system benefits from residential flexibility
Summary
As a consequence of the energy transition, the traditional power system faces several challenges. Peak loads are expected to increase, due to the electrification of residential energy demand for heating and transportation. This requires both generation and grid capacity. The electrification of energy demand is driven by the need to increase energy efficiency; the use of heat pumps and electric vehicles reduces overall energy demand, but increases electricity demand. This electrification is both a challenge and an opportunity, as flexibility at the demand side is expected to increase as a result. DR can be used to match flexible demand to (renewable) generation or to reduce peak loads
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