Monday 24 September 2018
How to optimise the value that DSR can deliver
Energy market and DSR expert Ben Spry shares some of his observations from the recent DSR Event organised by The Energyst, where he participated in the panel debate Follow the money: Where’s it going and how can you access best value?
What motivates businesses to look at Demand Side Response (DSR)? Here’s what some of the participants interviewed by the Energy Live News team at the recent Energyst DSR Event had to say:
“We’re likely to see a 10% increase in our energy prices over the next year… so we’re actively looking at DSR opportunities to generate revenue and savings.”
“We re-signed our electricity contract recently and have seen an increase of 40%, so if that trend continues, there’s more opportunity to do more DSR activity.”
“We are always looking at new technologies, so DSR will come into play… to reduce costs.”
Cost is clearly a key motivator. (And you can hear more from these businesses and others here).
But what Ben Spry, Head of Risk Management at Energy HQ and a panel member at this DSR Event, also finds is that many businesses are confused about how to really maximise the value from DSR.
“Successful DSR isn’t just about saving on peak energy charges or earning revenue from participating in National Grid products and services,” he says. “It’s about identifying all the appropriate benefits and then stacking them so that you really optimise the value that your flexibility can deliver.”
These include increasing resilience for any onsite generation assets. “There’s a common misconception that participating in DSR will somehow weaken a business’s ability to respond to an unforeseen situation requiring back-up generation to counter any interruption to normal supply,” says Ben. “But in fact by choosing the right partner and implementing DSR effectively, the opposite is true. Running your assets regularly and ensuring they are well maintained means they are in better shape to respond when you need them most.”
There are also new opportunities to benefit from peak prices in the wholesale energy market. “As well as the potential to earn revenue from National Grid contracts and save on costs associated with peak-time consumption, we have developed a product to offer businesses the option to sell back volume they can free up from DSR activity,” explains Ben.
“We believe we are one of the only suppliers to offer customers the opportunity to access the Day Ahead (N2EX) and Within Day (APX) markets via our Wholesale Market Access service,” continues Ben. “This can be used as part of a wider DSR strategy or as a stand-alone DSR activity for businesses looking to dip their toe in the water to start with.
“For customers utilising flexibility for Triad and other cost avoidance activities, they need to make sure they are monetising this in the wholesale market – which Wholesale Market Access does.”
Unlike other DSR schemes, Wholesale Market Access carries no obligation – so there’s no penalty if you decide not to participate. “And because we link DSR with a customer’s energy contract, you won’t be penalised by volume tolerance clauses either,” says Ben.
Depending on market conditions and your level of flexibility, businesses can expect to earn in the region of £30-60/MWh per year from Wholesale Market Access. “But as every customer is different, we assess the potential before we recommend participation and how best to balance it with other benefits,” says Ben. You can read more in Ben’s ‘A fail safe way to make DSR pay’ blog.
For more on the overall benefits of DSR, read our Business Benefits of DSR article.
And to find out how much DSR could save your business, please speak to a member of the Energy HQ team – you can contact them via EnergyHQ@npower.com or call 0800 994 9382.
This is a promoted article.
