Downloads / energy economics

The role of utilities in enabling prosumers and flexible distributed energy resources

Daniel Quiggin, Chatham House This paper explores how utilities could transform as the electricity system undergoes a second phase of transformations and the business models they could develop. The main focus will be on the role existing power companies could play in enabling distributed energy resources (DERs) and prosumers to participate in an increasingly flexible electricity system, via energy service platforms. The electricity sector is experiencing a deep and profound disruptive shock, the effect is most obvious in Australia, the EU-28 and parts of North America, where once powerful utility companies are struggling in the current market and many are restructuring to survive. Three major factors define this phase of transformational changes: renewable deployment, slower than expected demand growth and in many jurisdictions, market reform. Whilst many utilities are now beginning to respond to the structural shifts embedded within the electricity systems they operate, it is becoming apparent that a second phase of transformational shifts is around the corner. This second phase is intimately linked to the first phase and is likely to have greater transformational impacts, amplifying the impacts Read more…

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Quiggin-The-role-of-utilities-in-enabling-prosumers-and-flexible-distributed-energy-resources.pptx 1.39 MBQuiggin-The-role-of-utilities-in-enabling-prosumers-and-flexible-distributed-energy-resources.pdf 809.02 KB
19th
Sep
2018

Modelling fuel demand of heterogeneous industrial consumers

Paolo Agnolucci, University College London (UCL) No economic sector incorporates more heterogeneity in the typology of energy consumers than the industrial sector, yet analysis of energy and fuel demand are normally conducted for the industrial sector as whole rather that at a more disaggregate level, a choice normally due to data availability. Motivated by the goal of developing the new industrial module adopted by the UK government Department of Business, Energy and Industrial Strategy (BEIS) for their econometric Energy Demand Model, our paper reports results obtained as part of a three step estimation process, where in the first step we estimated the determinants of economic activity for 8 industrial subsectors, in the second step we estimated the determinants of energy demand (published elsewhere[1]) and in the third step, discussed here, we assess substitution across fuels in each of the industrial sub-sectors modelled in our research. Using data spanning from 1990 to 2014 on fuel consumption and prices published on the Digest of UK Energy Statistics, and indices of production collected by the Office for National Statistics we implement detailed fuel Read more…

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Angnolucci-modelling-fuel-demand-of-heterogenerous-industrial-consumers.pptx 954.57 KBAgnolucci-Modelling-fuel-demand-of-heterogenerous-industrial-consumers.pdf 585.43 KB
19th
Sep
2018

No one left behind – Consumer empowerment, protection and universal service in the low carbon

Chris Harris , npower The fourth and fifth carbon budgets have challenges in implementation of current policies, and some remaining policy gaps. The Paris commitments are a further challenge. This will require radical change, not just in the efficient use of energy but in the way we live, work and travel in the next generation. Very substantial, if not almost complete electrification seems almost inevitable in any feasible compliant scenario. The gig economy will be a critical enabler for the changes to the rhythm of life, and is particularly suited to an electrified society. Technology, and its cost, does not seem a major constraint.  The critical restriction is the ability of the physical system, market arrangements, regulation, and industry operations, to accommodate it. It is almost impossible to visualise a very low carbon system with infrastructure and operation with very large volumes of “predict and provide” central generation and capacity infrastructure to accommodate inflexible variable demand.  Conversely it is relatively straightforward to envisage a very low carbon system with highly active prosumers. Further it is possible to visualise how the Read more…

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Harris-no-one-left-behind.pptx 537.8 KBHarris-No-one-left-behind-consumer-empowerment-protection-and-universal-service-in-low-carbon-transition.pdf 874.53 KB
18th
Sep
2018

Motivating energy conservation in organisations: Smart metering and the emergence and diffusion of social norms

Peter Bradley, University of the West of England Around the world there is strong interest in the use of energy feedback via smart metering technology as a mitigation option for businesses to reduce their energy use and mitigate greenhouse gases (GHGs).   A number of relevant early studies have looked at energy feedback in an organizational setting.  In order to bring about energy reductions, feedback provided needs to motivate changes in energy behaviours and practices within organisations. Social norms sometimes act as an extrinsic motivation for behaviours around particular energy services, particularly in a group setting.  The majority of studies that have looked at social norms and energy related behaviours tend to only pick up on the role of injunctive (subjective) norms – driven by a view of what is socially acceptable – and not descriptive norms also – based on the perception of other peoples’ actions; and generally there are relatively few organisation based studies.  The literature identifies that more research linking social influence mechanisms to behaviour change are needed; few field studies have looked at social norms and social Read more…

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Bradley-motivating-energy-conservation-in-organisations.pptx 841.12 KBBradley-motivating-energy-conservation-in-organistations.pdf 872.43 KB
18th
Sep
2018

Energy efficiency policy instruments in the residential sector: Implementing mechanisms for successful low-carbon transitions in households

Cristina Penasco, University of Cambridge Overview and relevance of the topic Improving energy efficiency (EE) is vital to ensure an economic, environmental and social sustainable energy system. According to the International Energy Agency (IEA), increasing EE in buildings represents one of the most cost-effective ways to improve energy security and reduce the environmental damages from the current system. Residential sector represents approximately 19% of the total final energy consumption in the OECD in 2015, reaching a 30% in the UK, one of the highest rates in Europe (IEA, 2016). Many studies have highlighted the important role that public policy can play to reduce energy consumption in residential buildings (Geller et al. 2006). The IEA estimates that public policies can reduce energy consumption in residential buildings by 30-80%, while increasing energy security and improving welfare conditions. This is an ex-ante engineering-based assessment that makes important assumptions regarding the impact of new policies. However, there are a large number of policy and academic assessments of the impact of policies in building energy consumption that may not be accounting for social factors, information Read more…

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Penasco-Energy-efficiency-policy-instruments-in-the-residential-sector.pdf 973.76 KB
18th
Sep
2018

The impact of tightening margins on plant availability

Dr Amy  O’Mahoney, Ofgem, United Kingdom  Mr Kristian Marr, Ofgem,United Kingdom  Shashi van de Graaff, Ofgem, United Kingdom  Mr David Hall,  Ofgem, United Kingdom In recent years, the generation mix in most electricity markets has been in transition, resulting in larger proportions of variable generation. In GB, wind and solar accounted for 13% and 5% of installed capacity respectively in 2015 , and 11.5% of generation over the same period.  This intermittent generation is not always capable of delivering in periods of tightness, and thus contributes considerably less to peak demand. This development in the electricity market has led to changes to how the system is operated.   As a result, more flexible thermal plant is now required to run differently than originally intended; wind generation has been shown increase the cycling of existing units (Troy et al., 2010). This relates to additional start-ups, ramping and operation at part load (Denny and O’Malley, 2009; Troy et al., 2010). Analysis of availabilities in other markets has indicated that the availability of CCGTs in GB is below those in comparable markets.  Forced breakdown rates are Read more…

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OMahoney-The-Impact-Of-Tightening-Margins-On-Plant-Availability-slides.pdf 722.77 KBOMahoney-The-Impact-Of-Tightening-Margins-On-Plant-Availability1.pdf 698.22 KB
21st
Sep
2016

Energy Barometer 2016

Deane Somerville, Knowledge Team Manager, Energy Institute The 2016 Energy Barometer Report captures insights from UK energy professionals and enables them to form the energy debate, policymakers, influencers, the industry and the public. Deane Somerville has worked in the Knowledge Team at the Energy Institute for the past three years, and has been involved in the development and production of the Energy Barometer as well as other Knowledge Service products. Prior to joining the EI, he worked in environmental consulting, focusing on contaminated site remediation. Academically, his background is in Geology as well as Energy and Environmental Technology. Deane is a Graduate member of the Energy Institute.  

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Energy_Barometer_2016-Somerville.pdf 1.35 MB
21st
Sep
2016

Rebound Effect for Energy Services: The Case of UK Households

Dr Mona  Chitnis, University of Surrey, United Kingdom Prof Steve Sorrell, London School of Economics, United Kingdom Dr Roger Fouquet, London School of Economics, United Kingdom Improved energy efficiency is widely expected to play a key role in reducing energy consumption and GHG emissions. However, the energy and emissions savings from such improvements may be less than simple calculations suggest, owing to a variety of economic mechanisms that go under the heading of rebound effects. Direct rebound effects result from increased consumption of relatively cheaper energy services: for example, an efficient boiler lowers the cost of space heating so households may choose to increase internal temperatures and/or leave the heating on for longer. Indirect rebound effects result from induced changes in consumption of other goods and services, the provision of which necessarily involves energy use and GHG emissions. For example, the money saved on space heating may be spent instead on increased lighting, or on electronic goods. Re-spending therefore may lead to additional energy use and emissions, which offset the original energy and emission savings. This study estimates the direct and indirect rebound Read more…

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Chitnis-Rebound-effect-for-energy-services-the-case-of-UK-households.pdf 608.72 KBChitnisFouquetSorrell-ReboundEffectsForHouseholdEnergyServicesInTheUK.pdf 846.64 KB
21st
Sep
2016

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