Which Electricity Market Design to Encourage the Development of Demand Response?

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dc.contributor.author RIOUS, Vincent
dc.contributor.author ROQUES, Fabien A.
dc.contributor.author PEREZ, Yannick
dc.date.accessioned 2012-02-24T17:01:08Z
dc.date.available 2012-02-24T17:01:08Z
dc.date.issued 2012
dc.identifier.issn 1028-3625
dc.identifier.uri http://hdl.handle.net/1814/20622
dc.description.abstract Demand response is a cornerstone problem in electricity markets under climate change constraint. Most liberalized electricity markets have a poor track record at encouraging the deployment of smart meters and the development of demand response. In Europe, different models are considered for demand response, from a development under a regulated regime to a development under competitive perspectives. In this paper, focusing on demand response and smart metering for mid-size and small consumers, we investigate which types of market signals should be sent to demand manager to see demand response emerge as a competitive activity. Using data from the French power system over the last 8 years, we compare the possible market design options to allow demand response to develop. Our simulations demonstrate that with the current market rules, demand response is not a profitable activity in the French electricity industry. Introducing a reserve and/or capacity remuneration could bring additional revenues to demand response providers and improve incentives to put in place demand response programs in a market environment. en
dc.language.iso en en
dc.relation.ispartofseries EUI RSCAS en
dc.relation.ispartofseries 2012/12 en
dc.relation.ispartofseries Loyola de Palacio Programme on Energy Policy en
dc.subject Market Design en
dc.subject Demand Response en
dc.subject Capacity Market en
dc.title Which Electricity Market Design to Encourage the Development of Demand Response? en
dc.type Working Paper en


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