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Explicit Demand Response in Europe

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Explicit Demand Response in Europe Smart Energy Demand Coalition Explicit Demand Response in Europe Mapping the Markets 2017 Smart Energy Demand Coalition The SEDC would like to thank the following key stakeholders for the crucial expertise they provided: Austrian Power Grid (APG), Verbund, Energy Economics Group, Elia, Energinet. dk, Dansk Energi, Elering, Fingrid, Energy Pool, Réseau de Transport d’électricité (RTE-France), National Grid, Eirgrid, Autorita Energia Italia (AET), Terna Group, Arpinge, TransnetBw, Statnett, Polskie Sieci Elektroenergetyczne (PSE), Eles, ERES (Entidade Reguladora dos Serviços Energéticos), (Redes Energéticas Nacionais) REN, Svenska kraftnät (SVK), the Swiss Federal Office of Energy (BFE), and Swissgrid. We also thank all SEDC Members for their valuable contributions and feedback. Smart Energy Demand Coalition (SEDC) Rue D’Arlon 69-71 1040 Brussels, Belgium www.smartenergydemand.eu The views expressed in this document represent the views of the SEDC as an organisation, but not necessarily the position of a specific SEDC member Explicit Demand Response in Europe - Mapping the Market 2017 SEDC - Smart Energy Demand Coalition 2 SEDC Members Executive Associate Explicit Demand Response in Europe - Mapping the Market 2017 SEDC - Smart Energy Demand Coalition 3 Foreword Dear Reader, In 2017 we are on the cusp of a Demand Response breakthrough in Europe. In the two years since our last Demand Response Map was published, we have seen improvements in almost all of the countries analysed, but progress has been gradual. Markets are slowly being opened where they were once closed, the role of aggregation is becoming more defined, and market product requirements are becoming more accessible for Demand Response. However, there is still much work to be done and flexibility potential to be realised across the continent. The launch of the European Commission’s Clean Energy Package in November 2016 marks the start of the large-scale unlocking of Demand Response potential in Europe. We are currently tapping in to around 20GW of activated Demand Response, but the Commission places the potential at 100GW, rising to 160GW in 2030. As we see the further integration of renewable energies in the electricity markets, the need for flexibility is all the more crucial. Demand Response is the perfect partner for the decentralised and variable energy sources necessary for reducing carbon emissions and energy imports in Europe. The SEDC has been at the forefront of advocating for Demand Response, and the necessary accompanying regulatory framework, in order to realise its potential in Europe. We welcome the proposed legislative package by the Commission on Electricity Market Design, but also other initiatives on the smartness of buildings. Such legislative initiatives should propel the countries at the lower end of our Map to truly activate Demand Response, and should push the more advanced countries to do even better. We have a momentous opportunity to deliver these proposals through the European Parliament and Council this year. Let’s make 2017 the year of Demand Response, and put consumers and flexibility at the heart of the energy system. Brussels, this day 6th April 2017. Jessica Stromback Explicit Demand Response in Europe - Mapping the Market 2017 SEDC - Smart Energy Demand Coalition 4 Contents Executive Summary...........................................................................................................................7 Measuring the Frameworks for Explicit Demand Response.................................................................................... 8 The Status of Regulatory Conditions Today ........................................................................................................... 10 Conclusions ........................................................................................................................................................... 12 List of Figures ...................................................................................................................................................14 List of Tables ...................................................................................................................................14 List of Acronyms ..............................................................................................................................17 Introduction ....................................................................................................................................22 Background: Why is Demand Response Important? ............................................................................................ 22 Enabling both Explicit and Implicit Demand Response ......................................................................................... 23 Benefits of aggregation ......................................................................................................................................... 23 1. Regulatory Requirements for Enabling Demand Response ........................................................27 1.1 European Regulatory Framework for Demand Response ............................................................................... 28 1.2 Regulatory Needs to Enable Demand Response ............................................................................................. 31 2. Member State Analysis ...............................................................................................................37 2.1 Methodology ................................................................................................................................................... 38 2.2 Member States Reports .................................................................................................................................. 42 Austria .............................................................................................................................. 42 Belgium ........................................................................................................................... 49 Denmark ......................................................................................................................... 58 Estonia............................................................................................................................. 67 Finland ............................................................................................................................ 72 France ............................................................................................................................. 80 Germany ......................................................................................................................... 93 Great Britain .................................................................................................................. 104 Ireland ........................................................................................................................... 116 Italy ............................................................................................................................... 124 The Netherlands ............................................................................................................ 133 Norway .......................................................................................................................... 143 Explicit Demand Response in Europe - Mapping the Market 2017 SEDC - Smart Energy Demand Coalition 5 Poland ........................................................................................................................... 154 Portugal ......................................................................................................................... 164 Slovenia ......................................................................................................................... 169 Spain .............................................................................................................................. 175 Sweden .......................................................................................................................... 181 Switzerland .................................................................................................................... 187 3. Overall Results ..........................................................................................................................193 3.1 Demand Response Access to Markets .......................................................................................................... 197 3.2 Service Provider Access ................................................................................................................................ 198 3.3 Product Requirements .................................................................................................................................. 200 3.4 Measurement, Verification, Payments and Penalties ................................................................................... 201 4. Conclusions ...............................................................................................................................204 References ....................................................................................................................................207 Explicit Demand Response in Europe - Mapping the Market 2017 SEDC - Smart Energy Demand Coalition 6 Executive Summary There is growing consensus, among policy makers Response,
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