Task XI Time of Use Pricing and Energy Use for Demand Management Delivery Task Status Report April 2006 Richard Formby

Subtasks 1, 2, 3 Participating Countries Denmark Finland Greece (Subtask 1 only) Netherlands Spain Sweden UK

Political Context of Demand Side Participation Energy markets may not deliver adequate peak supply capacity Need to reduce CO 2 (Kyoto) Renewables targets Increasing energy costs Smaller customers use 20-40% of electricity

Supply Context of Demand Side Participation Costs of peak generation capacity Costs of peak network capacity Integration of renewables Intermittency of renewables Security of supply targets

Customer Context of Demand Side Participation Rapidly increasing energy costs Require methods to reduce costs Require methods to maintain supply availability Require methods to protect environment

DSM contribution to solving these issues Dynamic/Static DSM Affects load shape and load level Important to involve smaller customers

Objective of Task XI Determine whether and how smaller customers can participate in demand markets and change end use to deliver energy saving and increased security

Task XI Dynamic DSM Behaviour responding to use information Demand responding to price Automatic, manual Market bidding of demand Frequency response, standing reserve, demand turndown, export contracts Validation Profiling

Objectives for the last six months Complete participating EXCO approval for Subtask 3 report, Demand Side Bidding for Smaller Customers Obtain country support and funding for new Subtasks 4 and 5

Progress against objectives Final reports for Subtasks 1,2 and 3 completed and approved by participating EXCO members: –Smaller customer Energy Saving by End Use Monitoring and Feedback (Subtask 1) –Time of Use Pricing for Demand Management Delivery (Subtask 2) –DSM for Smaller Customers (Subtask 3)

Applications and Operation for Smaller Customers Potential loads are: –Storage heating, cooling and water heating (switch energy “in”/”out”) –Direct space heating (modify thermostat settings) –Direct water heating (modify thermostat settings) –Direct space cooling (modify thermostat settings) –Embedded generation (start out of heat led regime) –Fridges and freezers (switch off for short period) –Washing machines (disable for period, change time schedule –Cooker (disable for period) –Sauna, car heaters (disable for period) –Direct electric showers (disable for period)

Task XI Results/Conclusions Reducing peak demand for few hours per year has large benefit EUMF motivates energy savings of 10% Face to face customer interview preferred method of presentation for EUMF Accurate EUMF data difficult to justify Disaggregated energy statistics should be added to energy bills now

Task XI Results/Conclusions Dynamic and Real Time TOU demand switching and DSB can replace scheduled generation Peak demand reduction potential of 2kW per customer with TOU/DSB Demand reduction more cost effective than new peaking capacity

Task XI Results/Conclusions Demand at smaller customers can be aggregated and bid as alternative to generation Tariff, Dynamic and Real Time TOU Pricing viable for direct space, water heating thermostat control Targeting electric space heating and cooling, water heating and embedded generation best for DSB effectiveness May be viable for central air conditioning, microgeneration, saunas and direct electric showers Communication not major technical constraint

Task XI Results/Conclusions Combinations of Tariff, Dynamic and Real Time Pricing can be applied to end uses in a household TOU economics attractive if one way communication acceptable Customer motivations require development Profile settlements and demand validation require solutions

Recommendations Evaluate specific value of different feedback methods End use disaggregated energy data statistics should be added to smaller customer energy bills now Develop models to convert interviews into advice Evaluate demand management with no customer override and single rate metering Evaluate micro CHP and fuel cells responding to TOU prices

Recommendations Estimate incentives needed for obtrusive demand management for few hours per year Evaluate combined Tariff, Dynamic and Real Time, TOU pricing in a single household Develop mechanisms for aggregating and validating “available” and “turn down” demand Quantify the impact of dynamic profiles on “profile” settlements Develop architectures for smaller customer DSB roll out

Progress against Objectives Subtask 4 –Dynamic Profile Settlements Subtask 5 –Evaluate methods for validating demand

Status of Subtasks 4 and 5 funding

Work Schedule

Subtask 4 Contribution Country Contribution (Euros) Netherlands14,812 Spain14,812 United Kingdom14,812 Total44,436

Subtask 5 Contribution Country Contribution (Euros) Netherlands12,639 Spain12,639 United Kingdom12,639 Total37,917

Budget Original budgetEuros 0 Costs to date:Euros0 Manpower: Management Technical Administration Other Costs