[99] Investment in demand response affects its own business case

This article pointed out that heat pump flexibility can be harnessed through demand side response. A challenge though is how to stimulate demand response in the home? Mobile games could be the answer!

Andrew Webster, Northern Powergrid (UK): ‘Household electricity use will grow significantly as electric vehicles and heat pumps become mainstream, increasing demand on the network. Mobile games offer a fun solution to help manage this demand, rewarding our customers for reducing their consumption at peak periods.’

Demand response is currently promising, but eventually there will be no more peaks to shave or valleys to fill. Beware of investments that rely on a long-term market for demand response.

[98] Infrastructure cannot be smart without proper management

The context of this tweet is the EU’s goal to replace at least 80% of electricity meters with smart metering systems by 2020.

However, consumers must be actively encouraged to use them. This involves effective and ongoing consumer education to encourage them to make the most of the opportunities arising out of smart meter data. This requires much better communication by governments, retailers, networks, consumers and community organisations as part of the smart meter rollout.

[97] Trust but verify

According to Ecofys, the European Commission’s impact assessment of 2030 energy efficiency targets currently only takes a private and short-term perspective to assess the financial impacts. It does not take into account the role of public policy making in reducing market barriers and changing market designs.

They consider that a cost-benefit analysis is the appropriate way forward. An example of such a cost-benefit analysis, using the Commission’s available data, shows that energy bill savings resulting from energy efficiency targets of up to 40% could exceed the costs of upfront investment.

[96] Beyond technico-economic analysis

The reason why the classic ‘technico-economic’ approach is not working optimally is because investments in energy efficiency result in more than a reduction of energy consumption. They also lead to a variety of non-energy benefits.

These include improved product quality, reduced production time, improved health and well-being, reduced environmental footprint etc.

Integrating the multiple energy and non-energy benefits of energy efficiency significantly improves the business case of energy-efficiency investments in the business sector by raising their strategic and financial attractiveness.

[95] Regulation creates markets, but it also closes them

Primary energy factors deliver important signals to the markets, act as key drivers for sector coupling, and incentivise certain technologies and fuels while discouraging others.

PEF calculation methods can lead to (un)intended promotion of fossil fuels over renewable sources.

Within the EPBD, a proper PEF calculation is essential to produce a meaningful energy performance certificate.

Due to the increasing share of (especially non-combustible) renewable power, total primary energy gradually loses its function as an efficiency indicator.