IDEAS home Printed from https://ideas.repec.org/a/eee/enepol/v62y2013icp1031-1039.html
   My bibliography  Save this article

An assessment of market and policy barriers for demand response providing ancillary services in U.S. electricity markets

Author

Listed:
  • Cappers, Peter
  • MacDonald, Jason
  • Goldman, Charles
  • Ma, Ookie

Abstract

An impact of increased variable renewable generation is the need for balancing authorities to procure more ancillary services. While demand response resources are technically capable of providing these services, current experience across the U.S. illustrates they are relatively minor players in most regions. Accessing demand response resources for ancillary services may require a number of changes to policies and common practices at multiple levels. Regional reliability councils must first define ancillary services such that demand response resources may provide them. Once the opportunity exists, balancing authorities define and promulgate rules that set the infrastructure investments and performance attributes of a resource wishing to provide such services. These rules also dictate expected revenue streams which reveal the cost effectiveness of these resources. The regulatory compact between utility and state regulators, along with other statutes and decisions by state policymakers, may impact the interest of demand response program providers to pursue these resources as ancillary service providers. This paper identifies within these broad categories specific market and policy barriers to demand response providing ancillary services in different wholesale and retail environments, with emphasis on smaller customers who must be aggregated through a program provider to meet minimum size requirements for wholesale transactions.

Suggested Citation

  • Cappers, Peter & MacDonald, Jason & Goldman, Charles & Ma, Ookie, 2013. "An assessment of market and policy barriers for demand response providing ancillary services in U.S. electricity markets," Energy Policy, Elsevier, vol. 62(C), pages 1031-1039.
  • Handle: RePEc:eee:enepol:v:62:y:2013:i:c:p:1031-1039
    DOI: 10.1016/j.enpol.2013.08.003
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0301421513007908
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.enpol.2013.08.003?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Walawalkar, Rahul & Fernands, Stephen & Thakur, Netra & Chevva, Konda Reddy, 2010. "Evolution and current status of demand response (DR) in electricity markets: Insights from PJM and NYISO," Energy, Elsevier, vol. 35(4), pages 1553-1560.
    2. Bode, Josh L. & Sullivan, Michael J. & Berghman, Dries & Eto, Joseph H., 2013. "Incorporating residential AC load control into ancillary service markets: Measurement and settlement," Energy Policy, Elsevier, vol. 56(C), pages 175-185.
    3. Centolella, Paul, 2010. "The integration of Price Responsive Demand into Regional Transmission Organization (RTO) wholesale power markets and system operations," Energy, Elsevier, vol. 35(4), pages 1568-1574.
    4. Hovgaard, Tobias Gybel & Larsen, Lars F.S. & Edlund, Kristian & Jørgensen, John Bagterp, 2012. "Model predictive control technologies for efficient and flexible power consumption in refrigeration systems," Energy, Elsevier, vol. 44(1), pages 105-116.
    5. Cappers, Peter & Mills, Andrew & Goldman, Charles & Wiser, Ryan & Eto, Joseph H., 2012. "An assessment of the role mass market demand response could play in contributing to the management of variable generation integration issues," Energy Policy, Elsevier, vol. 48(C), pages 420-429.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Carreiro, Andreia M. & Jorge, Humberto M. & Antunes, Carlos Henggeler, 2017. "Energy management systems aggregators: A literature survey," Renewable and Sustainable Energy Reviews, Elsevier, vol. 73(C), pages 1160-1172.
    2. Olmos, Luis & Ruester, Sophia & Liong, Siok-Jen & Glachant, Jean-Michel, 2011. "Energy efficiency actions related to the rollout of smart meters for small consumers, application to the Austrian system," Energy, Elsevier, vol. 36(7), pages 4396-4409.
    3. Jiang, Bo & Farid, Amro M. & Youcef-Toumi, Kamal, 2015. "Demand side management in a day-ahead wholesale market: A comparison of industrial & social welfare approaches," Applied Energy, Elsevier, vol. 156(C), pages 642-654.
    4. Guo, Peiyang & Li, Victor O.K. & Lam, Jacqueline C.K., 2017. "Smart demand response in China: Challenges and drivers," Energy Policy, Elsevier, vol. 107(C), pages 1-10.
    5. Alcázar-Ortega, Manuel & Álvarez-Bel, Carlos & Domijan, Alexander & Escrivá-Escrivá, Guillermo, 2012. "Economic and environmental evaluation of customers' flexibility participating in operation markets: Application to the meat industry," Energy, Elsevier, vol. 41(1), pages 368-379.
    6. Leinauer, Christina & Schott, Paul & Fridgen, Gilbert & Keller, Robert & Ollig, Philipp & Weibelzahl, Martin, 2022. "Obstacles to demand response: Why industrial companies do not adapt their power consumption to volatile power generation," Energy Policy, Elsevier, vol. 165(C).
    7. Jordehi, A. Rezaee, 2019. "Optimisation of demand response in electric power systems, a review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 103(C), pages 308-319.
    8. Keon Baek & Woong Ko & Jinho Kim, 2019. "Optimal Scheduling of Distributed Energy Resources in Residential Building under the Demand Response Commitment Contract," Energies, MDPI, vol. 12(14), pages 1-19, July.
    9. Katz, Jonas, 2014. "Linking meters and markets: Roles and incentives to support a flexible demand side," Utilities Policy, Elsevier, vol. 31(C), pages 74-84.
    10. Biegel, Benjamin & Westenholz, Mikkel & Hansen, Lars Henrik & Stoustrup, Jakob & Andersen, Palle & Harbo, Silas, 2014. "Integration of flexible consumers in the ancillary service markets," Energy, Elsevier, vol. 67(C), pages 479-489.
    11. Peter Warren, 2018. "Demand-side policy: Global evidence base and implementation patterns," Energy & Environment, , vol. 29(5), pages 706-731, August.
    12. Siler-Evans, Kyle & Morgan, M. Granger & Azevedo, Inês Lima, 2012. "Distributed cogeneration for commercial buildings: Can we make the economics work?," Energy Policy, Elsevier, vol. 42(C), pages 580-590.
    13. Sun, Kai & Tseng, Chen-Ting & Shan-Hill Wong, David & Shieh, Shyan-Shu & Jang, Shi-Shang & Kang, Jia-Lin & Hsieh, Wei-Dong, 2015. "Model predictive control for improving waste heat recovery in coke dry quenching processes," Energy, Elsevier, vol. 80(C), pages 275-283.
    14. Derya Eryilmaz, Timothy M. Smith, and Frances R. Homans, 2017. "Price Responsiveness in Electricity Markets: Implications for Demand Response in the Midwest," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1).
    15. Gonçalves, Ivo & Gomes, Álvaro & Henggeler Antunes, Carlos, 2019. "Optimizing the management of smart home energy resources under different power cost scenarios," Applied Energy, Elsevier, vol. 242(C), pages 351-363.
    16. Wang, Yong & Li, Lin, 2015. "Time-of-use electricity pricing for industrial customers: A survey of U.S. utilities," Applied Energy, Elsevier, vol. 149(C), pages 89-103.
    17. Woo, C.K. & Li, R. & Shiu, A. & Horowitz, I., 2013. "Residential winter kWh responsiveness under optional time-varying pricing in British Columbia," Applied Energy, Elsevier, vol. 108(C), pages 288-297.
    18. Zheng, Shunlin & Qi, Qi & Sun, Yi & Ai, Xin, 2023. "Integrated demand response considering substitute effect and time-varying response characteristics under incomplete information," Applied Energy, Elsevier, vol. 333(C).
    19. L. (Lisa B.) Ryan & Sarah La Monaca & Linda Mastrandrea & Petr Spodniak, 2018. "Harnessing Electricity Retail Tariffs to Support Climate Change Policy," Working Papers 201822, School of Economics, University College Dublin.
    20. Amit Shewale & Anil Mokhade & Nitesh Funde & Neeraj Dhanraj Bokde, 2022. "A Survey of Efficient Demand-Side Management Techniques for the Residential Appliance Scheduling Problem in Smart Homes," Energies, MDPI, vol. 15(8), pages 1-34, April.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:enepol:v:62:y:2013:i:c:p:1031-1039. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/enpol .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.