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The Importance of IoE for Energy System Flexibility

There is consensus among IoE stakeholders that a prerequisite for flexibility on the demand side is for the consumers and prosumers to be properly rewarded first for their role and contribution. If consumers and prosumers fail to be sufficiently rewarded for their backup capacity contribution toward flexibility, then uptake of IoE technologies could be negatively affected.

 

As countries in developed markets retire some of their centralised baseload power generation, it is often being replaced with distributed generation. This will create a greater need for backup capacity and greater flexibility to be built into today’s energy systems. The residential sector will play a major role in fulfilling these needs, by supporting greater system flexibility through demand-side response, energy storage and distributed generation.

If interoperability hurdles are removed by IoE stakeholders, driving up Home Energy Management (HEM) solution adoption by 30% more than originally forecast (reaching 51.1 million homes across Europe), then 102GW of load capacity could be shifted, creating the potential for 25.5GWh of energy to be supplied back into the grid (see Figure 1).

 

Figure 1: Residential Demand Flexibility Potential

 

Note: Based on the assumption that on average each HEM solution equipped home could shift 2KW of load and supply 0.5KWh of energy back to the grid.
Source: geo estimates based on IDC estimates of HEM solution equipped homes.

 

The Key to Flexibility

 

There is consensus among IoE stakeholders that a prerequisite for flexibility on the demand side is for the consumers and prosumers to be properly rewarded first for their role and contribution. If consumers and prosumers fail to be sufficiently rewarded for their backup capacity contribution toward flexibility, then uptake of IoE technologies could be negatively affected. Government-led initiatives are supporting the adoption of IoE technologies, from incentivising the installation of solar panels, to seemingly getting serious in backing up the future success of electric mobility, to supporting demand response programs. Despite these positive steps in the right direction, it is simply not enough.

Scattered and standalone incentives for photovoltaics and EVs will not unleash the full potential of IoE technologies. Governments need to be more proactive in acknowledging the benefits of having more substantial demand-side support toward flexibility, by encouraging and incentivising active homes. Active homes should receive the same attention that EVs are receiving, as active homes can help address charging-related issues created by the deployment of EVs.

More Information

 

This blog has been extracted from the whitepaper “The Internet of Energy – Enabling Residential Demand Management” produced independently by the IDC (International Data Corporation). You can download a full version of the whitepaper here.

If you would like to explore the topics discussed in this white paper in more detail, please contact geo by phone on +44(0)1223 850 210 or by email at marketing@geotogether.com.

End users have a critical enabling role, so their interests must be contemplated and addressed first.

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