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Technical devices, economic signals and customer attitude impact on Demand Response
October 15, 2012
Colette Lewiner
2Copyright © Capgemini 2012. All Rights Reserved
Presentation Title | Date
Status on the EU energy efficiency 2020 objectives
Source: BP statistical report 2012, European Environment Agency, Eur’Observer – Capgemini analysis, EEMO14
EU-27 primary energy consumption
1,450
1,500
1,550
1,600
1,650
1,700
1,750
1,800
1,850
1990 1995 2000 2005 2010 2015 2020
EU
-27
Pri
ma
ry e
ne
rgy
con
sum
ptio
n [M
toe
]
Historical evolution of primary energy consumptionPath to reach 2020 target2020 target for EU-27Projection with current measures in place(as per the March 2011 EU Energy Ef f iciency Plan)New objective def ined in the June 2012 EU Energy Ef f iciency Directive
-20%
-17%
-9%
June 13, 2012 new Energy Efficiency Directive:
• 17% decrease of EU’s primary energy consumption by 2020
instead of 20%• Requirement for Utilities to make
energy savings equivalent to 1.5% of their annual sales each
year from 2014 to 2020
3Copyright © Capgemini 2012. All Rights Reserved
Presentation Title | Date
In countries as France and Japan, peak shaving is a key issue during extreme weather conditions
3
A holistic approach to manage the peak load needs to be implemented. It should encompass:• Generation capacities development (including incentives for peak power)• Demand response: tariffs or other types of demand response programs
• Incentives for energy savings • Grids reinforcement
Oil-fired + peak
capacities5%
Coal5%
Gas3%
Nuclear58%
Wind2%
Hydro13%
Others6%
Imports8%
Source: RTE
Generation mix on February 8, 2012 at 19:00 • The French electricity peak load reached 102,100 MW at 19:00
• Nuclear plants’ availability largely contributed: 59,165 MW (55 reactors out of the 58 were in operation)
• France imported 7,845 MW from all its neighboring countries (max 9,000 MW)• On EPEX Spot, day-ahead electricity prices jumped to €1,938/MWh• RTE activated it EcoWatt demand response program in Brittany and PACA regions
which resulted in a consumption reduction of respectively 2% and 3%• EnergyPool curtailed 20 MW of industrial consumption which have been used for
Brittany region In 2011, net new generation capacities have been added:
• 850 MW of CCGT• 1,250 MW of renewable energies• 450 MW of fossil-fired plant have been decommissioned
New housing heating gas is regaining market share: close to 60% compared to less than 40% for electricity in 2011 (2008 electrical heating market share was 70%). This has decreased the potential electricity demand at peak hours by 450 MW
But tariff-related demand response capacities have decreased from 6,000 MW in 2004 to 3,000 MW in 2011
4Copyright © Capgemini 2012. All Rights Reserved
Presentation Title | Date
Pilot programs results on peak shaving
% peak shaving observed in various pilots worldwide
Peak shaving: the use of displays helps but the customers’ behavior is key
Several means exist for peak shaving and energy savings, that can be combined or not:• Dynamic tariffs (that should
be further developed with the mass roll-out of smart meters)
• Automation such as smart thermostat, smart appliances, in-home displays or web-based consumer portal
• Demand management programs such as customers alerts, social networks communication or feedbacks through bills, web, SMS, smart phones
% peak shaving Range of peak shaving
Source: Capgemini Consulting
5Copyright © Capgemini 2012. All Rights Reserved
Presentation Title | Date
14
18
11 12
10
53
4
23
0.1
0.60.4
0.3 0.3
0.1 0.1 0.1
2021
13 13
11
65 5
4 4
1.3
1.6
1.1
0.80.8
0.40.3 0.3
0.2 0.2
0.00.10.20.30.40.50.60.70.80.91.01.11.21.31.41.51.61.7
0
2
4
6
8
10
12
14
16
18
20
22
24
Savi
ngs i
n el
ectr
icity
cons
umpti
on (i
n eq
uiva
lent
num
ber o
f m
ajor
citi
es)3
Savi
ngs i
n ge
nera
ting
capa
citi
es (i
n nu
mbe
r of p
ower
pla
nts)
2
14%
12%
12%13%
13%
13%
14%13%
14% 14%
2%
3%
3%
2%
3%
3%
2%2%
2% 2%
7.6
9.1
6.4
4.4
4.9
2.4
1.9 1.7
1.3 1.1
Demand response potential for EU-27 by 2020
Demand Response study 2012 results snapshot
Our study shows that peak shaving potential is significant while electricity savings potential is more limited
In Capgemini Consulting’s Demand Response (DR) study*, the potential of peak shaving and energy savings is modeled on the basis of a baseline scenario:• GDP growth 2010-20: 1.8% in average• CAGR electricity consumption 2010-20: 0.7%• Some existing energy efficiency programs such as
Grenelle de l’Environnement or White Certificates Assumptions are made on:
• Regulation (norms and standards, energy efficiency objectives, tariffs and incentive policies)
• Market design (possibility to monetize DR on wholesale markets, contracts optimization, capacity markets)
• Smart meters penetration and functionalities (for the households segment)
And typical DR offerings are modeled with hypothesis on their adoption by customers
*Demand Response study 2012 - Capgemini Consulting, VaasaETT and Enerdata
1 Normative hypothesis: 1 kWh saves 700g CO2 (average European value considering avoided peak capacity is mainly gas-fired plants)2 Expressed in equivalent of avoided consumption of large size cities (2 mio inhabitants and 150,000
commercials, average consumption of 8.2 TWh/year)3 Expressed in equivalent of avoided construction of power plants (500 MW)
Source: Capgemini Consulting
Forecast scenario (dark bars)
Dynamic scenario (light bars)
Dynamic scenario
% peak shaving
% energy saving
CO2 emissions saving (in Mt)
14%
2%
7.6
6Copyright © Capgemini 2012. All Rights Reserved
Presentation Title | Date
Clients marketing and segmentation is key for successful Demand Response
Customers awareness-raising is key for a sustained customers’ behaviors change
• New customer segmentation enabling Demand ResponseSEGMENTATION
• Better customer knowledge to adapt relationship strategy (feedback, advice, Demand Response, diagnosis, …) and channel management (paper, internet, …)
CUSTOMER KNOWLEDGE
• Implementation of a media strategy and related KPIs to measure efficiency of each customer segment, each type of message, each channel and each mediaCOMMUNICATION
• Build specific offerings adapted to the customer segmentation and relationship strategy (ex: advice on internet, in-house displays, electrical appliances remotely switched in/off, …)OFFERINGS
• Set up a pilot’s objectives and expectations, implement a system to monitor and analyze the results, set up customers’ recruitment campaigns, build on lessons learnedROADMAP
EXAMPLES OF SEGMENTATION CRITERIA• Sociological (behaviors…)• Psychological (awareness to technology …)• Economical (power purchase, energy bill …)• Technical (type of heating system, of housing, …)
7Copyright © Capgemini 2012. All Rights Reserved
Presentation Title | Date
Mass roll-out finalized
Mass roll-out by 2020 well-engaged
Mass roll-out probably not completed by 2020
IE
NL
CH
SE
DK
NO
FI
EE
LT
LV
PL
SK
ROSI
UK
PT
ES IT
GR
FR
BE
HU
DE
AT
BG
CZLU
Smart meters could be a Demand Response enabler
80% of electricity customers in EU Member States should have smart meters by 2020. All countries required to perform cost benefit analysis by September 2012
In September 2011, France has decided the mass roll out of 35 million meters from 2013 to 2020 but the starting date will be delayed.
4 technologies experimented for gas smart meters (18,500 meters) in France. Final mass roll-out decision should be taken in 2013
In Europe the Value Chain unbundling
regulation, impacts negatively the return
on smart meters investment and slows
down decisionsSource: ESMA, GEODE – Capgemini analysis, EEMO12, updated March 2012
NorwayE Draft regulation issued in Feb. 2011
80% roll-out by 2016, 100% by 2018
FinlandE Legislation into effect. At least
80% roll-out by end 2013
EstoniaE Mandatory nationwide roll-
out under discussion
SwedenE 100% smart meters
implemented in 2009
DenmarkE Deployment by several
DNOs. No national plan
GermanyE 50 trials from 10 to 115,000 meters
Nationwide roll out under discussionCustomers can opt in or out
G Similar to electricity
PolandE Legislation should be ready in 2012
Pilots run by all UtilitiesG Similar to electricity
Czech RepublicE National roll-out under discussion
Several pilots under wayAustriaE Legislation adopted in 2010.
Pilots from 10,000 to 240,000 meters
G Legislation under discussion
BelgiumE No legislation yet
Several business case studies under way
G Similar to electricity
FranceE Decision for roll-out of 35
million smart meters by 2020 taken in 2011.
G GreenLys pilot, decision for mass roll-out by 2013
GreeceE Roll-out under way
G Plans for extending the electricity system to water and gas meters
ItalyE 100% smart meters
implemented in 2009G 80% smart meters to be
installed by 2016
HungaryE Legislation adopted in 2011
G Legislation under discussion
UKE 27 million smart meters should
be implemented by 2020G Similar to electricity
NetherlandsE Legal framework for voluntary
installation adoptedSeveral pilots under way
PortugalE Smart meter substitution plan
presented by the regulatorSeveral pilots (30,000 to 50,000 meters) run
SpainE 100% smart meters should be
implemented by end 2018
IrelandE National roll-out
planned for 2014-17G Studies under way
for gas
Electricity and gas smart metering projects in Europe
8Copyright © Capgemini 2012. All Rights Reserved
Presentation Title | Date
Time-of-Use tariffs are important DR triggers: Ontario example
2.4% peak shaving (on a 6-hour period, from 11:00 until 17:00)
5.7% peak shifting (on a 3 or 4-hour period) Off-peak consumption shifting hardly quantifiable 6% consumption reduction
Some peak consumption reductions haven’t been reported (notably lighting) during off-peak periods
This dynamic tariff has an indirect effect on consumption patterns
3% savings on bills under the dynamic tariff (compared with the standard tariff)
75% customers have made bills savings
The dynamic tariff is promoted as a tool allowing customers to analyze their consumption and control their bills
This program resulted in peak shaving as well as peak shifting
Regulated Time-of-Use tariffs (c$/kWh)
SU
MM
ER
WIN
TE
RW
EE
KE
ND
HO
LID
AY
S
Lessons learned
9Copyright © Capgemini 2012. All Rights Reserved
Presentation Title | Date
Visual tariff signal has also a significant impact on DR: Energy Orb example
“Energy Orb” from PG&E (Pacific Gas and Electricity) is a visual indications to clients involved in energy demand management programs
The device alerts business customers before and during an energy consumption reduction period
Many technical devices exist to trigger consumption reduction. They are often expensive and their profitability remains to be established. Customers are reluctant
to invest in these equipments and services and consumption reductions are not always fitting their expectations
The information contained in this presentation is proprietary.© 2012 Capgemini. All rights reserved.
www.capgemini.com
About Capgemini
With more than 120,000 people in 40 countries, Capgemini is one of the world's foremost providers of consulting, technology and outsourcing services. The Group reported 2011 global revenues of EUR 9.7 billion.Together with its clients, Capgemini creates and delivers business and technology solutions that fit their needs and drive the results they want. A deeply multicultural organization, Capgemini has developed its own way of working, the Collaborative Business ExperienceTM, and draws on Rightshore ®, its worldwide delivery model.
Rightshore® is a trademark belonging to Capgemini
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