If UK businesses and public sector buildings realised the potential for load shifting and onsite generation the country could save billions on its collective energy bill by 2035, a new report from the Association for Decentralised Energy has claimed.
The report, published this morning, claims that as much as 16% of the UK’s peak electricity demand could be provided by businesses shifting their demand to times of less strain on the grid and maximising on-site generation through technologies such as solar and CHP.
Such a figure – equivalent to around 9.8GW – would be a 10-fold increase on current levels and save consumers as much as £600 million each year by 2020 and £2.3 billion by 2035.
This would revolve around the government opening up more of the capacity market auction, within which businesses and generators can bid to create grid capacity.
Some businesses have already been successful in the capacity market and recouped around £100 million, and the Department of Energy and Climate Change had also supported an electricity demand reduction pilot which awarded major retailers £4.7 million in support for switching off at appropriate times.
Tim Rotheray, director at the ADE, said that UK energy security in manufacturing was becoming “increasingly challenging” with changes to the electricity market.
“If we are to meet this challenge successfully, we need to access the enormous resource that energy users can provide, whether they are NHS hospitals, pharmaceutical manufacturers or your local retail store. Today’s report shows that by putting these users at the heart of the energy system, we will make it more cost-effective, reduce carbon emissions, and give customers a chance to participate in the system and take control of their energy use.”
Rotheray added that the market was often guilty of underestimating the potential for decentralised energy systems.
“By making these changes to the balancing market, the capacity market and balancing services, we will allow businesses to compete fairly and help deliver the UK’s demand-side response potential,” he said.
National Grid meanwhile has endorsed the reports findings. Cathy McClay, head of commercial operations at National Grid, said: “National Grid is actively working on how we as an electricity industry can enable increased participation of a range of flexibility sources in our markets. We believe that there are great opportunities for consumers of energy to play an active role in flexibility and realise [the] benefits of doing so.”