Government call for evidence seeks business views on smarter energy system
The UK Government has today (10 November) confirmed its commitment to the creation of a smarter, flexible energy system with a new report which outlines the opportunity for businesses to actively balance their energy needs.
The Department for Business, Energy and Industrial Strategy (BEIS) and Ofgem have published the call for evidence paper which asks businesses for advice on how to best develop technologies such as demand response and energy storage, and increase the uptake of electric vehicles (EVs).
The responses will help shape a plan, expected to be published in spring 2017, which will set out the specific actions BEIS plans to take to remove barriers, improve price signals and stimulate innovation.
Business and Energy Secretary Greg Clark said: “The age of exclusive control by big energy companies and central government is over; we must maximise the ability of consumers to play an active role in managing their energy needs. With a smart system we can go further and faster in breaking down barriers to competition – allowing the widest possible range of innovative products and services to prove themselves in the market place.
“To make the most of a smart system we need smart policy and smart regulation. Our ultimate objective – clean, secure and affordable energy – is clear, but a number of possible pathways lie before us. In this Call for Evidence we ask open questions about these strategic choices, which we will make with the best available information and always with current and future energy consumers at the heart of our decisions.”
BEIS states that its aim is to create a level playing field for demand response and storage to compete with other forms of flexibility and more traditional solutions. A non-existent definition of storage in legislation, the double counting of storage, and the role of the capacity market are identified as barriers which could be removed to help drive the deployment of these new technologies.
The document proposes that smart technology providers should be able to have easier access to a range of different markets, including the balancing market and ancillary services. The report suggests that the removal of barriers towards the deployment of these technologies could save the UK up to £40bn across the electricity system by 2050.
The paper is also requesting evidence on the future role of EVs in the electricity system. The mobilisation of battery and hydrogen fuel cell vehicles are cited as great opportunities which could shift peaks in the electricity demand. The Government believes there is a case for vehicle-to-grid innovation – currently being trialled in the UK by Nissan - to provide models that work for business fleets and encourage EV owners to shift charging away from the peak loads through incentivisation.
Renewable Energy Association (REA) chief executive Dr. Nina Skorupska CBE said: “The Government’s call for evidence could be the foundation of the flexible, decentralised energy system that reduces energy bills for every one of us. This document clearly shows that the Government is aware of the revolution taking place in the energy sector right now, and sees that the shift to a more decentralised, flexible system could feel as radical as the emergence of mobile phones.
“The right questions are being asked but it’s now about the speed in which policy change can take place. Storage and demand response technologies are evolving very rapidly and the Government risks being in a position where it is not leading but playing catch up or worse, by standing in the way.”
The Government call for evidence will come as welcome news to industry experts for whom energy storage and demand response technologies represent the future of a new industrial strategy.
On Monday, new research from Policy Exchange found that a smarter, more flexible power system which takes advantage of these technologies could create savings for the UK to the tune of £8bn by 2030.
In its last report before being disbanded, the Energy and Climate Change Committee (ECC) urged the Government to redesign its Capacity Market to give the market a “clear signal” that demand response capacity is a preferred option to diesel generation plants, and to “move quickly” to address the regulatory barriers faced by energy storage.
The National Grid’s new Winter Outlook report, released last month, highlighted the potential for demand response measures to keep the system balanced during the winter months. In the build-up to the report's release, a separate ECIU study concluded that an increased uptake of demand response would help to keep the system balanced and, ultimately, cut the cost of national energy security.
edie launches free demand response guide for businesses
Organisations with an interest in using demand response to manage energy use now have access to a free, comprehensive 'edie explains' guide which breaks down all of the key information required to deploy the technology.
The new edie explains: Demand response business guide, produced in association with edie's supporting partner Flexitricity, provides an in-depth summary of demand response, which balances peak electricity supply and demand curves by shifting consumption.