The variability of energy prices, DSR programmes in EU Directives

Price of energy varies during the day and depends on the cost of generation by the energy generating source. Trading companies are buying electricity on so-called energy market before selling it to consumers.

Energy consumer
s usually are not participating in the energy market, thus the daily consumption profile does not translate into the cost of purchasing energy by consumers, but experience from Europe and America shows:

  • growing importance of flexibility of the power system based on the increased share of unstable sources of generation,
  • energy consumer plays an important role for the growth of this flexibility as well as for correctly defined products of Demand Side Response;
  • the need of transmission system operator to be actively supporting the searches of the optimal organizational and financial solutions, which enables significant number of consumers to take part in the market services system;

Effective participation of the demand side in the markets for electricity depends primarily on creating the right framework in regulation and market structures. The European Commission has expressed its strong support for Demand Side Response and the directive on energy efficiency, among others, states:

  • In art. 15.4, that „Member States shall ensure the removal of those incentives in transmission and distribution tariffs that are detrimental to the overall efficiency (including energy efficiency) of the generation, transmission, distribution and supply of electricity or those that might hamper participation of demand response, in balancing markets and ancillary services procurement. Member States shall ensure that network operators are incentivised to improve efficiency in infrastructure design and operation, and, within the framework of Directive 2009/72/EC, that tariffs allow suppliers to improve consumer participation in system efficiency, including demand response, depending on national circumstances”.
  • In art. 15.8, that „Member States shall ensure that national energy regulatory authorities encourage demand side resources, such as demand response, to participate alongside supply in wholesale and retail markets.(…), Member States shall ensure that transmission system operators and distribution system operators, in meeting requirements for balancing and ancillary services, treat demand response providers, including aggregators, in a non-discriminatory manner, on the basis of their technical capabilities.”

 

 

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