By Peter Boait, Finalist, Demand ShaperOur focus for much of this month has been the business model behind Demand Shaper and the way in which the value from Dynamic Demand can be demonstrated and at least partly captured to create a viable business. Of course, such commercially sensitive details do not lend themselves to a blog, particularly part way through a competition, so here we have to illustrate the value of our proposition by more oblique means.
We can do this by reference to the dynamic demand system that exists today. It is known as Radio Teleswitch, and has been in operation since the 1980s. It consists of a central control system operated by the Energy Networks Association (ENA) which transmits a signal buried in the BBC Radio 4 long wave broadcast that is picked up by receivers located in a majority of the 1M homes in the UK heated by storage radiators under an Economy 7 tariff. Each receiver uses the signal to decide when to switch on the storage radiators so that the thermal stores within them are charged up using electricity from the grid – an example receiver is shown in the picture on the right of the meter. The limited timing flexibility offered by this system is used by National Grid as a tool for balancing the system. It operates completely automatically so few people realise they have this device.Now the future of this system is threatened because the BBC Radio 4 long wave transmitter is reaching the end of its life because of the antique and irreplaceable nature of the valves in it. So you might think that our system, which could perform all the functions of Radio Teleswitch and much more, and can use a wide variety of telecommunications media avoiding dependency on any one channel, would be a shoo-in to replace it.
Sadly that is not the case. The centralised electricity industry that had no difficulty in making the decision to invest in Radio Teleswitch in the 1980s is now so fragmented into a multiplicity of stakeholders that aligning all their interests sufficiently to agree on a replacement is a considerable challenge. But the mere existence of this system, the value attributed to it today, and the necessity of updating it, gives us confidence that a business case can be developed.