Demand side flexibility – the ability of consumers to adapt their electricity consumption in response to market signals – is both an extremely valuable resource to the European electricity system, and a remarkably untapped one. Developing demand side flexibility across Europe will not only deliver benefits for individual consumers but could also dramatically reduce total energy costs and build Europe’s smart energy leadership.
With this briefing, E3G highlights propositions to European policy-makers currently working on the "Clean Energy for All Europeans” package of legislative proposals to make sure that this important resource is indeed deployed.
Key steps needed to ensure the potential of demand-side flexibility is met include:
- Maintain the Commission’s necessary proposals encouraging demand side response in the Electricity Directive and the Electricity Regulation, notably those conferring basic rights for consumers to participate in energy markets and preventing discrimination between market participants and resources.
- Ensure cost minimisation and fair remuneration for consumers by fully remunerating their valuable contribution to system flexibility and to the reduction in network costs.
- Track whether the development of demand side flexibility is sufficient and task TSOs and national regulators to assess what level of flexibility they would need to minimise the curtailment of renewables and meet climate and energy objectives.
- In case of insufficient development, consider temporary market creating measures to kick-start demand response markets.