Business-led demand response to generate £8bn
20th July 2016 | Commercial Energy
The Flexibility on Demand report, released on Tuesday 19 July, says that UK energy consumers could save £2.3bn by 2035 and that business-led demand response initiatives could reduce demand on the electricity grid and lower national costs by £8.1bn by 2030: this is more than £300 per household. Businesses venturing in to demand response initiatives could establish a 10-fold increase in revenue streams, having already gained £100m from the Government’s Capacity Market.
Tim Rotheray, ADE’s director, said, “Keeping the lights on and our factories running is becoming increasingly challenging as the electricity market changes. We are building more wind and solar, which cannot always be depended on, and we are seeing our traditional large nuclear and coal power plants close down.
“If we are to meet this challenge successfully, we need to access the enormous resource that energy users can provide, whether they are NHS hospitals, pharmaceutical manufacturers or your local retail store. Today’s report shows that by putting these users at the heart of the energy system, we will make it more cost-effective, reduce carbon emissions, and give customers a chance to participate in the system and take control of their energy use.”
Reducing demand increasing supply, the report claims that up to 16% of the UK’s peak electricity requirements could be provided by businesses: it’s the marriage of reducing consumption and business-provided generation which could make this work.
2.8GW of electricity could be drawn from demand response flexibility in the industrial sector: so if a large user of electricity could delay operations so they just use previously stored supplied of energy, for example, could make a difference. Turning off refrigeration units, to use their insulation more effectively to maintain low temperatures, rather than continuing to keep the motors and condensers on.
The National Grid’s head of commercial and electricity Cathy McClay said: “National Grid is actively working on how we as an electricity industry can enable increased participation of a range of flexibility sources in our markets. We believe that there are great opportunities for consumers of energy to play an active role in flexibility and realise benefits of doing so.”
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