Ceem research seminar on the issue of consumer participation in the electricity markets…

Abstract

PROGRAMME AND PRESENTATIONS
15h30 Registration

16h00 Welcome of Participants and Introduction by Dominique Finon (Scientific Counsellor, CEEM and CIRED-CNRS)

16h00 – 17h00
Laura-Lucia Richter (NERA Consulting, PhD from Cambridge University)
Which Smart Electricity Service Contracts Will Consumers Accept? The Demand for Compensation in a Platform Market
Presentation
This paper considers the heterogeneity of household consumer preferences for electricity service contracts in a smart grid context. The analysis is based on original data from a discrete choice experiment on smart electricity service contracts concerning 1,900 UK electricity consumers in 2015. The results suggest that while customers are willing to pay for technical support services, they are likely to demand significant compensation to share their usage and personally identifying data and to participate in automated demand response programs.
Based on these findings, potential platform pricing strategies that could incentivise consumers to participate in a smart electricity platform market, are discussed. By combining appropriate participation payments with sharing of bill savings, service providers could attract the number of customers required to provide the optimal level of demand response. We also examine the significant heterogeneity among customers to suggest how, by targeting customers with specific characteristics, smart electricity service providers could significantly reduce their customer acquisition costs.

17h15 – 18h15
Antoine Verrier (PhD Student, Chaire EEM)
Viability of the Business Model of Demand Response Aggregator: Spot Energy Market Based Revenues for an Aggregator under Uncertainty and Contractual Limitation
Presentation
Economic viability of enabling technologies is often considered as a barrier to large-scale deployment and use of Demand Response resources in power systems. Compared to investment costs in such technologies, we carry out a quantification of expected annual revenues that a Demand Response aggregator might earn from a real-time energy market. We tackle this business case in the context of the French power system. Our contribution especially highlights the opportunity cost that the Demand Response aggregator might face given market uncertainty and consumer-based contractual limitations.