Do smart grids offer a new incentive for SME carbon reduction?

Abstract

Abstract Collectively small and medium sized enterprises (SMEs) are significant energy users although many are unregulated by existing policies due to their low carbon emissions. Carbon reduction is often not a priority but smart grids may create a new opportunity. A smart grid will give electricity suppliers a picture of real-time energy flows and the opportunity for consumers to receive financial incentives for engaging in demand side management. In addition to creating incentives for local carbon reduction, engaging SMEs with smart grids has potential for contributing to wider grid decarbonisation. Modelling of buildings, business activities and technology solutions is needed to identify opportunities for carbon reduction. The diversity of the SME sector complicates strategy development. SMEs are active in almost every business area and occupy the full range of property types. This paper reviews previous modelling work, exposing valuable data on floor space and energy consumption associated with different business activities. Limitations are seen with the age of this data and an inability to distinguish SME energy use. By modelling SME energy use, electrical loads are identified which could be shifted on demand, in a smart network. Initial analysis of consumption, not constrained by existing policies, identifies heating and cooling in retail and commercial offices as having potential for demand response. Hot water in hotel and catering and retail sectors may also be significant because of the energy storage potential. Areas to consider for energy efficiency schemes are also indicated.