Flexibility is the watchword in Demand Response

Flexibility must be an integral part of the systems that deliver energy to businesses in the green economy transition

Published on MAY 27, 2020

An opportunity to be monetized

Decarbonization, the onward march of digital and companies’ demand for individual solutions to their energy needs all point to the vital role different technological solutions play in ensuring that flexibility is hardwired into the systems delivering the power the modern economy relies on. Companies’ ability to be flexible about when they draw power from the grid offers an opportunity that can be monetized. Some also have the ability to supply energy to the grid in certain circumstances, representing another opportunity that grid operators are willing to pay to exploit. This is a trade-off — users’ flexibility helps liberate operators from the need to bring costly new capacity online and can compensate for variations in availability stemming from the role of the weather in generating energy from renewable sources.
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Three technologies for flexibility

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The technologies enabling this flexibility loosely form three groups. There are the straight Demand Response programsgeneration and optimization programs; as well as generator upgrades. Savings and revenue benefits generated by one group can be fed into the next to amplify the gains through improved energy management software, audits, assessments, upgrades to equipment leading to lower costs and better performance, among much else.

The benefits of Demand Response

Demand Response programs pay major users to reduce consumption when necessary to maintain network stability and reliability. The service enables clients to respond to peaks in either the supply or demand for electricity, allowing a more efficient use of infrastructure and resources. Given that by 2050 about 79% of total energy produced is forecast to come from green sources that are affected by the vagaries of the climate, this is of growing importance.
Added to that, participants receive so-called availability payments, in effect a retainer paid for being on call to reduce consumption. And there’s another benefit — depending on the program, companies taking part receive some period of advance notice of imminent issues with the grid, giving them time to prepare for a black- or brownout. 

Types of Demand Response clients

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Demand response programs can typically be accessed by clients who can cut demand by 100 kilowatts or more. Clients run the gamut from hospitals, schools to manufacturing facilities and warehouses. Enel X is the world’s leading operator of demand response programs, with a 12% share of the global market and managed capacity of 6.3 gigawatts. That’s enough to power more than 4.5 million homes.

The case for Generation & Energy Optimization

Generation & Energy Optimization – aka GEO – programs for clients that have their own generation assets are designed to get energy that is surplus to the client’s needs into the market. These programs come in two flavors. GEO Basic is for owners of on-site generation facilities such as solar panels, battery storage or combined heat and power assets. Enel X sees to the sale of the surplus and its energy trading expertise ensures it realizes the best price. GEO Advanced, for owners of combined heat and power facilities, or CHP, uses artificial intelligence to slash the customer’s overall energy expenditure through smarter use and lower costs. Generator upgrade plans allow customers to smoothly reduce demands on the grid without cutting their own energy consumption by taking advantage of the flexibility their on-site assets offer when it makes financial and operational sense to do so. Enel X checks that the equipment will perform when needed and that it meets the standards required to participate in demand response. If it falls short of those requirements, Enel X can finance and implement the upgrades needed to make good the shortfall.
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