Nest Learning Thermostat, which partners with utilities to provide residential demand-side response (DRS), shows how bilateral contracts for flexibility services can be utilised for the integration of renewable resources. Their so-called ‘Rush hour rewards’ scheme offers end-customers a menu of contracts with different lead times (from on-demand to 24-hour advance notice), duration of adjustments in electricity consumption (30 mins to 4 hrs) and payments.
Different consumer groups experience different disutilities for the various dimensions of flexibility they provide, researchers at the Oxford Institute of Energy Studies (OIES) pointed out. Hence, electricity contracts should ideally be designed in a way to allow the participant self-select the parameters.
The ‘Rush hour rewards’ programme has been singled out as a “good real-world example” as an attribute of the contracted consumer’s electricity consumption is adjusted automatically by an utility to manage fluctuations of demand and supply.
Targeted incentives enhance DSR
Targeted incentives make demand-side response mechanisms work more effectively, so utilities can fine-tune the behaviour of electricity end-customers through bilateral flexibility contracts – taking some strain off TSOs to keep the grid in balance.
OIES analysts recommend multi-dimensional bilateral contracts – as well as remunerating schemes for different kinds of flexibility, notably MW, MW/min and emission performance.
Moreover, demand aggregators and small energy storage are key measures to enhance the overall flexibility of electricity transmission network, but high transaction costs - relative to the size of resource – prevent these emerging small resources from participating directly in electricity markets.
Remunerating different kinds of flexibility – MW, MW/min and emission performance – would facilitate a more balanced competition. As a multi-dimensional commodity, flexibility can be described by many elements such as ramp rate, duration of plant dispatch, and lead time for capacity to be called upon.
Thermal storage for wind power
Affordable storage is seen as the missing link between intermittent renewable power and reliable energy supply. Yet, costs of power storage continue to fall as researcher race to develop an economically viable backup.
McKinsey research anticipates costs could fall to $200 per kWh in 2020 – half of today’s price, which would help transform the energy mix of many nations. By 2025, costs of power storage are expected to fall to $160 kWh or less, making it affordable to use for utilities and grid operators.
Working with the utility Hamburg Energie the Technical University Hamburg Harburg (TUHH), Siemens is developing a thermal storage solution to be paired with wind energy, which it hopes “will set a future standard in efficiency.” Excess wind energy is used to heat rock-fill, protected by an insulated cover – when stored electricity is needed a steam turbine converts the heat energy back to electricity.
Tests in spring 2017 will evaluate the energy conversion of a 36 MWh test bed based on a container holding approximately 2,000 cubic meters of rock-fill.