Demand side response how wind turbines will soon be providing your showers hot water

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Published: 27th May 2020

Demand Side Response: How wind turbines will soon be providing your shower’s hot water

To decarbonise the UK’s energy system and manage the associated increase in variable power generation, greater flexibility is required within the UK’s energy system. Demand Side Response (DSR) is widely viewed as a cost-effective source of flexibility with significant market potential amongst a variety of energy users. Conceptually, many assume that Demand Side Response is simply about turning electrical devices off to reduce demand, however as the percentage of renewable power on the grid increases, it will become important to have the ability to increase demand.

The provision of DSR services creates value by avoiding or increasing consumption and smoothing peak demands to balance intermittent generation and provide balancing services for network operators. Typically, those who have benefitted from providing DSR have been energy-intensive firms or aggregators who can manage a large enough demand shift for the benefit of the energy system.

Domestic DSR opportunity

Given that domestic buildings have consistently remained the second-most energy-intensive sector in the UK for the past 50 years, the creation of a DSR market opportunity could deliver significant energy system benefits if it can be tapped in to.

Figure 1: Change in energy consumption by sector 1970 to 2018. Source: BEIS Energy Consumption in the UK (ECUK)

To date, some homes participated in DSR through the use of time-of-use tariffs which incentivise the shifting of consumption to times outside of traditional peak hours. Furthermore, thanks to the roll-out of smart meters and increased digitalisation, live electricity prices updated at 30-minute intervals are now being forwarded directly to smartphone apps by some energy providers, allowing homeowners to turn appliances on or off in response to sudden changes in energy prices as renewables respond to changing weather conditions. These are worthy first steps, however challenges to this approach are the relatively small electrical loads being shifted and reliance on human behaviour.

By coupling increased digitalization and automation with storage assets, the domestic DSR opportunity becomes much more compelling. It could mean that household consumption patterns don’t have to change as the demand side response can be achieved via storage operating in the background as cheap energy comes online for use later in the day when prices peak.

Battery storage technologies offer huge promise for domestic DSR however they are also currently quite expensive and so far installed in very few homes. (the cost of a 13.5kWh Tesla Powerwall is around £6,000). By comparison a 250 litre hot water cylinder costs around £1,000 and can provide a comparable 11.6kWh storage capacity. What’s more,  an estimated 9 million hot water storage cylinders are already in people’s homes across the UK (or 1 in every 3 homes) – representing 100GWh available storage capacity available for DSR – a decent chunk of the today’s domestic consumption.

How can a hot water storage cylinder store electricity?

Most existing hot water tanks contain a backup electrical immersion heater that is similar to the electrical element within your kettle, typically this is only used when water can’t be heated via conventional means (usually a gas boiler in most UK homes).

By connecting the electrical element of the hot water tank directly to the live electricity prices that some consumers are already receiving via their apps, the humble hot water tank can be transformed into a valuable DSR asset – and the middleman (in this case, the homeowner) can be cut out. This means that at times where there is too much renewable electricity being generated by wind turbines or solar, the hot water cylinder can take this extra power, convert it to heat, and store it. There is an added benefit of this being done digitally, as the response can become almost instantaneous which allows more benefits to be fetched from the grid operators by providing frequency response to the energy system.

The USER Project

The USER Project is trialing this proposition by coupling Levelise’s existing Demand Side Response capabilities with Heatrae Sadia’s hot water tank gateway solution to create DSR-enable hot water tanks. Furthermore, via Levelise’s AI-led optimisation service, domestic demand profiles can be modelled and forecasted against the wider energy system characteristics (e.g. projections on wind and solar generation) to optimise individual home consumption to ensure that water is only heated before it will actually be used to ensure energy is used as efficiently as possible.

The USER Project is testing this in 350 homes in the UK over the next year. Participating homes will be aggregated in order to provide 1MWh DSR each day to participate in National Grid’s Firm Frequency Response (FFR) auction as primary response – revenues secured from FFR will be passed back to the homeowners.

Data collected within the trial will demonstrate how the proposition can be scaled over the next years to see smart DSR-enabled hot water cylinders being the link between renewable energy generation and showers across the country.

The USER Project is part-funded by The Department for Business, Energy and Industrial Strategy’s (BEIS) Domestic DSR competition. The competition was launched in 2018, committing £9.78 million in funding over 3 years to support innovative applications for smart energy systems that help homes directly interact with supply-side conditions. The competition has included 20 feasibility studies (Phase 1) and 14 subsequent demonstration projects (Phase 2).

For more information on the project, visit:
BEIS funding for innovative smart energy systems
Phase 2 Project details

You can also reach out to the author of this blog, Alex Taylor using the information below: | Phone: 0121 709 5587