The keys to boost demand flexibility through Energy Communities

Conclusions of the workshop 'The Role of Energy Communities in Advancing Flexibility and Demand Management', led by olivoENERGY as part of the III European Congress of Energy Communities, organised by the Goverment of Navarra.

Energy Communities are growing at a national level, as the many success stories and innovative initiatives that have been discussed at the III European Congress of Energy Communities, organised by the Government of Navarra.

We at olivoENERGY are grateful for the invitation to participate as technical support in Workshop 2: The Role of Energy Communities in the advancement of flexibility and demand management.

Our colleague Ernesto Santos Vallejo, together with Micaela Villaverde from ePlural, were in charge of conducting the workshop, which achieved the objectives it was designed for: to identify barriers and provide solutions as to why demand-side flexibility is not being implemented in energy communities and among their members.

In the first activity we proposed, we worked in small groups where the barriers to applying implicit flexibility (changes in consumption due to external signals such as the electricity tariff) were discussed among the participants, divided into social, technological, economic and legal barriers.

Question 1: Why do users in energy communities not apply implicit flexibility?

Social barriers
  • Lack of knowledge and energy culture among community members.
  • Disengagement or lack of involvement in climate change and how to contribute individually and collectively.
  • Lack of reliable sources on consumption for decision making.
  • Complicated designs that prevent a clear understanding of how dynamic fares work in order to make the best use of them.
  • Difficulty in adapting consumption routines to cheaper price schedules.
  • Influence on comfort and convenience.
  • Difficulty in accessing information in a clear and transparent manner.
  • Mistrust in the energy sector due to the fact that many marketers try to take advantage of people’s lack of knowledge to sell complex and uneconomical tariffs.
  • Cheating with low energy prices, but very high power in supply contracts.
  • Fear of unexpected increases in energy prices (uncertainty) as happened in the 2022 energy crisis.
  • Limited clear and transparent information programmes.
  • Mixed messages on design, do I follow solar renewable generation or hourly charge?
Technological barriers
  • Appliances without time scheduling and without interoperable communication between different sources of consumption and generation to manage it in a simple way.
  • Distrust and lack of knowledge about the technologies that would facilitate its implementation.
  • Technical complexity to interpret data to facilitate decision-making.
  • High cost of home automation and difficulty in adapting it to traditional households with outdated appliances.
  • Lack of knowledge of the use of smart meters and difficulty in visualising their data.
  • Difficult for some people without access to internet or mobile technologies.
  • Difficulty in obtaining storage technologies or self-consumption generators to take full advantage of the cheap hourly price bands.
  • If you have an electric vehicle, have a private smart charger to be able to charge the vehicle during cheap charging hours.
Economic barriers
  • High cost of home automation systems.
  • Economic incentives of small cheap time slots that do not make it attractive to shift consumption and generation.
  • There is no clear and immediate benefit after installing the necessary devices to monitor consumption and generation.
  • Attractive flat rates that provide security against the volatility and low savings of time-of-use tariffs.
  • Flat rates that do not encourage flexibility.
  • In case of energy crisis, very high time-of-use tariff prices.
Legal barriers
  • Oligopoly of electricity companies.
    Difficulty for distributors to apply dynamic coefficients.
  • No real-time access to smart meter information (lax regulation, high economic cost).
  • Over-regulation of the energy sector, generating uncertainty and distrust among community members.
  • In the free market, marketers use non-transparent and misleading commercial practices.
  • Risk of volatility in the electricity market, and the lack of stable prices discourages people from opting for time-of-use tariffs.
  • Tariff design not adapted to renewable generation: in solar hours very high grid access tariff (peak period).
  • Partial transposition of European regulations that require access to information at all times in a clear and transparent manner, which marketers are not doing, generating mistrust among consumer

Question 2: How can ECs incentivise their clients to be increasingly flexible by applying implicit flexibility?

To do this, we identified three groups of responses in advance: Communication, energy community services, partnerships.

Communication

  • Educate and raise awareness through workshops/ seminars/ educational programmes and resources on issues of implicit flexibility, consumption changes, cheaper tariffs, energy efficiency, etc.
  • Explain concrete actions to adjust and optimise consumption in a simple way.
  • Promote implicit flexibility and its benefits.
  • Provide information in a didactic way and understandable reports for decision making.
  • Enhancing environmental information and the positive impact of flexibility to increase consumer awareness and encourage change.
  • To publicise real-life examples of ECs that are already applying it and to serve as inspiration and good practice.
Energy community services
  • Facilitate access to batteries and home automation.
  • Facilitate the monitoring and interpretation of consumption and manage it to send signals to consumers.
  • Grouping consumption among consumers to have more flexibility collectively.
  • Apply the dynamic coefficients.
  • Integrating storage as an EC service.
  • Offering shared electric mobility and vehicle charging services.
  • Bringing together in a simple way the regulations and technological solutions to promote flexibility towards EC consumers.
Partnerships
  • Network to generate joint advocacy with other ECs and ecosystem entities for regulatory changes and funding facilities.
  • Alliances with demand aggregators.
  • Alliances with commercialisation companies to have special tariffs for EC members.
Others
  • Increase and manage access to grants to manage and obtain real-time data for ECs.
  • Applying tax incentives to producers and consumers of the ECs.
  • Invest in innovation for aggregation at EC level.
  • Improve regulation for energy distribution, allowing ECs to be grid operators.

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