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DEMAND SIDE MANAGEMENT
Empowering Utilities and Consumers
to Take Control of Energy
I n recent years, Demand Response
(DR) programmes have garnered
interest and attention in the electricity
industry, as they allow utilities and
municipalities to manage the equilibrium
and cost of energy systems and ensure
continued reliability of generation
capacity. The emergence of new cost
effective technologies appears to make
the process of responding to emergency
periods (load shedding) easier and
therefore more palatable to most
consumers. EXTENDING INTELLIGENCE TO
CUSTOMERS Achieving utility business transformation
requires evolving the relationship
between the utility and consumer into
a rich collaboration. It is with these
challenges in mind that Itron developed
WHAT IS THE DIFFERENCE
BETWEEN DEMAND RESPONSE
AND DYNAMIC PRICING?
The terms demand response and dynamic pricing are
sometimes used interchangeably, but the concepts are
quite unique.
Demand response is a distinct reduction in energy
usage for a defined and typically short period of time,
such as by way of load shedding. Dynamic pricing refers
to the rules under which a customer is charged for their
energy usage, whereby the tariff is either increased or
decreased in relation to the time of use and is typically
combined with an incentive, such as a tariff rebate.
The two concepts of demand response and
dynamic pricing are merged when a programme is
defined. 44
its new Itron Riva distributed intelligence
platform; a technology platform that
empowers the utility to make decisions
and respond to changing conditions
in real-time. By extending intelligence
throughout the network, Itron Riva brings
new approaches to solving today’s critical
challenges in grid operations.
Itron Riva transforms the utilities’
demand response events by averaging
the target load reductions within specific
metered populations to achieve the event
goals. The distributed intelligence of
Itron Riva segments meters to enable
surgical reductions in demand, based
on individual customer profiles and their
ability to shed load.
DEMAND RESPONSE AND
DYNAMIC PRICING
The use of demand response in
combination with dynamic pricing
programmes promises significant benefits
for consumers and utilities. Some utilities
state that these programmes are almost
40% of the business case supporting the
cost of smart metering along with labour
savings, call centre cost reductions,
reduced incidents of theft and increased
customer satisfaction.
On the surface, demand response
is a simple concept; during a period of
high usage, causing system constraints,
end-users reduce their usage and are
rewarded for that reduction with an
incentive payment or some other form of
financial compensation.
The reality of demand response is
much more complex, involving program
design, billing and compensation
rules and management or regulatory
decisions, technology implementations
from smart meters to analytic solutions,
and customer engagement efforts from
basic energy education to community
awareness campaigns and competitions.
Each component within the DR universe
presents its own challenges; however
addressed together there is promise
for successful programmes benefiting
utilities and consumers alike.
ACHIEVING DEMAND RESPONSE
SUCCESS Demand response will play an ever-
increasing role in the management of the
grid. More than likely, automated control
of appliances and systems will ultimately
become standard daily operations,
evolving from an exciting and novel idea
to one that goes almost unnoticed but
renders significant value.
Attaining this level of stability
and comfort with DR execution can
be reached by a smooth-flowing DR
universe where each component
fulfills its goals and feeds the cycle
with information for improvement.
Achieving that success requires a strong
partnership between policy makers,
technologists, educators and consumers.
Itron believes in building
sustainability into our already resource-
stretched systems. It is only through
technology and process innovations that
promised opportunity can be realised.
We work with our customers to achieve
their goals and continuously enhance
our offering to meet the increasing
challenges of the smartening grid. ESI
ESI AFRICA ISSUE 2 2015