New guidelines should increase demand response in Europe

Published: Fri 15 Nov 2013
A blog entry by Smart Grid Watch

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Last year the European Commission (part of the three-part EU government) published the 2012 Energy Efficiency Directive -- which set legally binding measures to step up Member States' efforts to use energy more efficiently at all stages, from production to distribution to consumption. Last week, the EC explained more about how to implement the EED, by issuing additional guidance on energy efficiency to Europe's Member States on energy efficiency.

To date, demand response has been limited in Europe. The EED, including the recent guidance, should yield additional demand response opportunities.

Article 15 of the EED addresses demand response. EU Member States must ensure that national energy regulatory authorities, transmission system operators, and distribution system operators maximize the energy efficiency potential of grids. By June 30, 2015, the EED requires Member States to assess the energy efficiency potential of their gas and electricity infrastructure and identify concrete measures to improve energy efficiency in their network infrastructure. The Article also provides for access and dispatch priorities for combined heat and power.

Article 15 also requires that energy tariffs and regulations promote energy efficiency and do not hinder demand response. It places demand-side resources (particularly demand response) on an equal footing with supply in terms of participation in wholesale and retail markets.

The EED specifically promotes access to (and participation of) demand response in balancing, reserve and other services markets. It requires Members States to define that the technical or contractual conditions for participation -- including the participation of aggregators and other demand response service providers. These roles, including aggregation, could be provided by distributors, retailers, or third parties.

In the bigger picture, these policy moves also help advance the EC's ambitious energy and climate change objectives for 2020: to reduce greenhouse gas emissions by 20%, to increase the share of renewable energy to 20% and to reach 20% energy efficiency.

Read more at Siemens Smart Grid Watch!