Demand Response & Aggregation Clause Samples
Demand Response & Aggregation. DR and aggregation are not only often considered together, but also in relation to common issues such as prosumers. In the 2019 NECP, DR and aggregation activities are mentioned various times and often together. According to this document, the development of DR is an objective of the Danish energy policy and the electricity market is open for participation of DR, including via aggregation [297]. Denmark is also “constantly seeking to improve market regulations” in order to encourage the participation of aggregated DR, including through the recent development of “an aggregator model allowing decentralised resources to participate in energy and ancillary services markets”[298]. In addition, DR is made possible through the deployment of smart meters, economic incentives provided by new tariffs (Flexafregning) and electrification of the district heating system [299]. Yet, although aggregation (Aggregering) is defined in the legal framework [300], this is not the case for DR. At best, one can find a mention of demand side management – which is a similar concept – in the Act amending the Electricity Supply Act [301]. The provision considers that when planning its network development, a DSO must assess whether demand side management measures or distributed generation can replace the need for capacity expansion. As a next step, DNV GL proposes to elaborate a joint Nordic energy transition planning regime in order to coordinate the development and use of flexibility resources in the entire region [302]. However, the development of DR and aggregation has so far been slow in Denmark. Contrary to the claims in the NECP that “[t]here are no specific barriers in Danish law that inhibit independent service providers to enter into a contract with a customer, or aggregators from offering demand flexibility”[303], a late 2020 report indicates that the “main role for prosumers in Denmark is self- consumption and on-site optimisation” due to the fact that electricity prices are high while the “use of flexibility is limited due to several barriers for independent aggregation”[ 304 ]. Selling flexibility services is apparently “only possible through pilot projects” for small and medium-sized providers [305]. Ma, Værbak and ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ acknowledge this for the pre-2020 situation, when the hourly tariffs entered the market [306]. At the moment, it is difficult to perceive the changes brought by the recent legal reforms and by the new possibility for consumers to also con...
Demand Response & Aggregation. The Portuguese NECP refers in a few instances to DR and aggregation. Yet, it considers DR in a restrictive manner, emphasising that industrial facilities as well as storage in the building sector and industrial sector will be used to provide peak shaving [383]. The document adds that ERSE “has approved the rules for implementing, as of 1 June 2018, two pilot projects, including the introduction of dynamic tariffs for network access in mainland Portugal”[384]. Regarding aggregation, the NECP proposes to add two new roles in the legal framework: market aggregator and demand aggregator [385]. The difference between these roles is not very clear but the demand aggregator comes the closest to the concept of (independent) aggregator as used in EU law and in this report [386]. In addition, similar to storage, the network planning instruments must consider investments in flexibility [387], but the Government estimates that the section on non-discriminatory participation of DR – including via aggregation – in all energy markets does not apply [388]. In legal terms, the lack of transposition of the 2019 E-Directive creates a lack of legal certainty for potential actors interested to engage in DR, including through aggregation. However, DL 162/2019 defines aggregation (Agregação) as being an activity undertaken by a singular or collective person, which can be a supplier and combines the electricity produced, consumed or stored by multiples clients buying or selling on energy or system service markets [389]. An independent aggregator is defined as a market participant involved in aggregation but who is not associated with the client’s supplier [390]. It is worthwhile highlighting that a market participant can be an operator of DR (Resposta da procura) services [391]. This is the only time DR is mentioned in the DL. The situation that aggregation in Portugal is underdeveloped has been concluded in a recent report stating that: Only one aggregator, acting as a [BSP] and only as a pilot project, is currently offering aggregated demand services to the ancillary services markets (regulation reserve market). The only other active aggregators are mediating between renewable energy system generators and the day- ahead and intraday markets, acting as [BRPs][392].