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Energy bodies call for greater consumer protection as DSR sector grows

Heat pumps - like this one from Daikin - are likely to be a common form of DSR. Image: Daikin.

Heat pumps - like this one from Daikin - are likely to be a common form of DSR. Image: Daikin.

As the domestic demand side response (DSR) sector grows, it will be essential that consumers are protected.

DSR offers great advantages for both consumers and the grid, allowing them often to benefit from lower cost electricity by switching their usage times to match low demand. As the proliferation of electric vehicles and heat pumps increases, these flexible technologies will offer more households the ability to benefit from lower cost electricity.

“For households, flexibility offers the opportunity of great customer service and earning money from the energy system, not just paying towards it,” explained Caroline Bragg, head of policy at the Association for Decentralised Energy (ADE). “For the system, domestic-level flexibility, with broader flexibility from business, offers the only way to reach net zero without breaking the bank.”

To allow this growth in the market, customers must feel confident in the switch to low carbon heating, vehicles and other areas. While a number of companies are already offering DSR services, this is likely to grow, as well as the services adapting and expanding along with innovation in the market.

As such, Citizens Advice, Energy UK and the ADE have put together a risk register, identifying the potential consumer risks, where these are covered by current legislation, what work is underway to address future risks and where there is likely to be a protection gap.

Gillian Cooper, head of energy policy at Citizens Advice, said that the transition to net zero will mean “huge changes to everyday life”, including heating and lighting our homes.

“It’s vital the potential benefits this will bring are open to all. For the transition to be successful, people will need the confidence to make these major adjustments. This means identifying and addressing early on any potential gaps in consumer protections.”

The risk register forms part of the report Demanding attention: Managing risks today, to improve customer experience tomorrow, which looks at pre-contract risks, risks during use and risks when something goes wrong.

It points to risks including customers' inability to engage, mis-advertising, potential ‘lock-ins’, lack of interoperability and insurance, highlighting all the current protections and those still needed.

"Domestic flexibility is still very nascent in the UK but it will, and indeed needs to, take off in the next few years,” added Bragg. “As the industry grows, it’s crucial that we continue to deliver consistently good customer outcomes.”

To read the full report, click here.


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