7 Qualities to Look For in a Demand Response Service

As network design and operation models grow, demand response (DR) also evolves to a much larger scale. Many development strategies feature various smart grid initiatives. Demand energy is a key component of that. 

Demand response programs are any reaction to a stimulus that alters electricity demand within a market. The response to the stimulus aims to achieve a variety of correlated and useful results. Demand response also addresses emergency and operational reserves, capacity, and real-time calibrating. 

Even more important, demand energy works to reduce electricity demand. It's important to find the best demand response service for your needs. Find out seven qualities to look for in a demand response service here.

1. The Customer Demands

A very blunt and important point is: electricity customers look for providers who offer the best prices for a reliable supply. As strong competition grows between electricity suppliers, those necessities change. Customers seek utilities that deliver the most electricity at the lowest costs. 

Demand response can deliver these low prices since the end-users receive an income. 

They often receive monetization from the flexibility of their load. They also receive money from consumption stimulation or curtailment. Having advanced response systems would then undeniably benefit most customers and prospects. 

2. The Regulatory Changes

There is a significant drive towards adopting and using DR technology and operation. It highlights the benefits of national regulatory bodies in an Energy Efficiency Directive. They encourage these resources alongside supply in wholesale and retail markets. 

Even the European Commission promotes the fair treatment of demand response and generation. This results in policy structures to access the same mechanisms and markets. They also encourage policymakers to review regulations that limit and restrict DR in the marketplace. 

There is also a common trend that benefits electricity customers.

It reduces most greenhouse gas emissions. It increases energy consumption that renewables produce. It also increases energy efficiency. 

Demand response could inspire future state aid for environmental energy and protection. For example, supply and demand resources can be considered for public subsidies. This would impact capacity markets significantly. 

3. Sales Benefits

The sales component of business can expand demand response and its energy services to customers. It helps them gain control over competitors in an increasingly competitive market. These advanced response systems ensure customer satisfaction. 

It can also lead to net reductions on electricity bills, an increase in customer retention, plus a more reliable revenue stream. Demand response today is a big argument and strong commercial control for utilities' sales activities. 

4. The Trading and Optimization

Trading and optimization on demand energy benefits from new and competitive products. It lowers the risk and optimizes the position of the portfolio. And those are just a few of the benefits of trading strategies. 

Some traders play with a set of price strategies and volatility. When paired with demand response, it provides additional utility benefits. For example, supply and consumption imbalances within a utility sector can be very expensive. 

Market operators can promote significant charges. Before facing these penalties, a common answer is turning to the balancing market. This market is the last resort but also produces high costs. 

Alternatively, demand response can help avoid these circumstances. It offers flexible and reactive technologies that balance supply and consumption. Under certain conditions, like high grid constraints, DR can be a big alternative to average balancing mechanisms.  

There is one more great benefit of demand energy for optimization and trading. It can help organizations manage their capacity charges and reserve responsibilities. This can result in great gains through optimization by using demand energy to free up productive assets and focus on energy sales.    

5. Generation Demand Response

Generation demand response can help improve things like power plant utilization rates. It stimulates the consumption of energy during off-peak hours. It also helps to flatten the demand curve. 

Demand response also allows generation portfolios to increase amounts of energy. It can increase capacity without having any added contractual risk. It could also be beneficial for generators to increase demand at particular times of the day in order to guarantee profitability.

Demand response can also ensure profitability.

This happens through displacement or consumption stimulation. And it also serves a solid standby generation tool. Both increase the need for generation demand response.

6. Benefits of Distribution

Demand response can provide a new way towards heavy investment in the reinforcement of HV/MV.

This is because of the lower demand for transmission infrastructure. The benefits of distribution come from congestion management support. It also comes from avoiding high penalties during peak times. 

7. Certain Obligations

Other great benefits of demand response are reserve obligations.

Each stakeholder benefits from supplying reserves. Through generation assets, it is in large part to advanced response systems. You can expect demand response to support ancillary service delivery in significant ways. 

The Bottom Line

It can be hard to integrate as well as implement demand response into operations and strategies.

It maximizes the benefits and addresses the details behind managing this load flexibility of most consumers. And partners with more experience can support utilities. They would save time and effort in the format and use of demand response solutions. 

It continues to be the key component of important smart grid technology. Whether through the demand of customers, certain markets, or the change of regulatory policy. demand response will find its place. Our sole focus is to do great work for our Texas-based ERCOT Demand Response customer — give us a call today!

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