Demand-side flexibility is key for decarbonisation! - Joint industry letter to Members of European Parliament

Brussels, 29 January 2019

Demand-side flexibility: the missing link in the EU 2050 decarbonisation Strategy “A Clean Planet for All”

Dear Member of the European Parliament,

The undersigned European business associations welcome the launch of a European debate following the presentation of the Communication “A Clean Planet for All” by the Commission. With the present letter we would like to contribute to the Resolution under discussion in the ENVI Committee of the European Parliament by highlighting the potential of demand-side flexibility, digitalisation and decentralised energy resources to enable the clean energy transition. Despite their important role, the pathways proposed in the Strategy do not fully reflect their potential in increasing demand-side flexibility.

Already now, smart solutions allow consumers of all sizes to interact with the energy system by making their demand more flexible. In the electricity system of the future, many more residential, commercial and industrial consumers (or “prosumers”) with digital and decentralised energy resources will be able to provide their demand-side flexibility through innovative services and demand response programmes using real-time monitoring, predictive analytics and automated response. In addition, consumers will be able to interact with the electricity system, by generating their own electricity (and sometimes jointly electricity and heat).

All consumers will benefit from demand-side flexibility, also the ones that do not participate directly in the flexible management of their loads, as the efficiency of the energy system will increase and wholesale electricity costs would be brought down compared to projections. Furthermore, this will prove essential to ensure the integration of variable renewable energy sources whose shares are set to increase significantly in most proposed scenarios of the Strategy.

The Communication from the Commission focuses on the active participation of consumers mainly in the context of behavioural changes to increase resource efficiency and reduce energy demand. But it is also important to analyse how demand-side flexibility, digital solutions and decentralised energy resources can empower consumers to become real active participants in the energy system and allow them to control their energy consumption in real time and interact with the system they are connected to in a dynamic way, not just passively.

Any lack of focus in the EU debate on how digital and decentralised energy resources will unlock the full potential of demand-side flexibility will have direct implications at a national level. It is already happening: many draft Integrated National Energy and Climate Plans submitted by Member States to the Commission in the last weeks, as foreseen by the Governance Regulation, omit to investigate the potential of demand response and the contribution of all decentralised energy resources to increase system flexibility.

The Intergovernmental Panel on Climate Change’s latest report warns that the world has just 12 years left to fundamentally reshape its energy systems and economies, or it will suffer the worst effects of climate change. We urge the Parliament to fully embrace the potential of digital solutions, demand-side flexibility and decentralised energy resources in enabling the clean energy transition.

PROPOSAL FOR AMENDMENT TO THE DRAFT MOTION FOR A RESOLUTION

The co-signatory organisations would like to suggest adding the following paragraphs in the draft resolution:

[The European Parliament]

  • Welcomes the political agreement reached by EU institutions on all dossiers of the Clean Energy for All European package which aim at putting consumers at the heart of the energy system, at promoting the uptake of cleaner and more decentralized flexibility solutions, and at shaping a decentralised, decarbonised energy system based on large shares of renewables where the interaction of demand and supply are digitally enabled and efficiently optimised; highlights that going climate neutral is both feasible and beneficial if the potential of digital decentralised energy solutions is fully grasped and if consumers are empowered to become active players in the flexible energy system;
  • Considers that none of the proposed pathways fully reflect the potential of digitalisation, demand response and energy storage and their contribution to empower consumers of all sizes to interact with the energy system and to participate in the energy markets through flexible demand, storage, renewable and highly efficient self-generation, while giving them control of their energy data;
  • Stresses the need to reflect in any pathway the role of demand-side flexibility, including an in-depth investigation of how to make the optimal use of all flexibility solutions, for which interoperability is key, and innovative decentralized business models.

Signatories:

  • AIE, European Association of Electrical Contractors
  • APPLiA, Home Appliance Europe
  • COGEN Europe, the European Association for the Promotion of Cogeneration
  • EER, Network of Independent Energy & Solution Providers
  • EHI, association of the European Heating Industry
  • EHPA, European Heat Pump Association
  • ESMIG, European Smart Meters Industry Group
  • OSGP Alliance, association dedicated to promoting the adoption of the Open Smart Grid Protocol (OSGP)
  • SmartEN, European business association for digital and decentralised energy solutions
  • Solar Power Europe, the association for solar electricity
  • T&D Europe, the European association of the electricity transmission and distribution equipment and services industry
  • Wind Europe, the voice of the wind energy industry

Contact at EHI Secretariat: Paolo Basso, Regulatory Affairs Manager, paolo.basso[at]ehi.eu

 

29.01.2019