The Role of Aggregators in Facilitating Industrial Demand Response: Evidence from Germany

Abstract

Industrial demand response can play an important part in balancing the intermittent production from a growing share of renewable energies in electricity markets. This paper analyses the role of aggregators-intermediaries between participants and the electricity market-in facilitating industrial demand response. Based on the results from semi-structured interviews with German demand response aggregators, as well as a wider stakeholder online survey, we examine the role of aggregators in overcoming barriers to industrial demand response. We find that a central role for aggregators is to raise awareness for the potentials of demand response, as well as to support implementation by engaging key actors in industrial companies. Moreover, we develop a taxonomy that helps analyse how the different functional roles of aggregators create economic value. We find that there is considerable heterogeneity in the kind of services that aggregators offer, many of which do create significant economic value. However, some of the functional roles that aggregators currently fill may become obsolete once market barriers to demand response are reduced or knowledge on demand response becomes more diffused.

Optimal sizing of energy communities with fair revenue sharing and exit clauses: Value, role and business model of aggregators and users

“…Traditionally, aggregators are private operators that act on the energy market on behalf of a set of consumers and prosumers [41] to provide benefits by bidding/hedging on the market to achieve a lower energy purchase price, properly operating generation and storage systems, and/or implementing demandside management or demand response policies [45,25,8]. Given this purpose, most studies have traditionally focused on techniques to optimally operate the aggregate [20,3,17], usually focusing on economic indicators.…”

“…Since each user solves its own problem, the total number of problems solved is |I|. The problem of the No-Assets (NA) configuration corresponds to solving the NC problem in (45) where users cannot install any asset, i.e., x a,U j = 0, ∀a ∈ A j , j ∈ I.…”

“…The Aggregated Non-Cooperative (ANC) configuration is based on the technical solution and optimal scheduling of the |I| NC problems in (45), but also accounts for the total reward obtained by the mutual energy sharing that would have occurred in the NC configuration anyway. The reward is calculated by definition as in ( 25) and the corresponding total social welfare is defined in (52).…”

Prosumer Community Portfolio Optimization via Aggregator: The Case of the Iberian Electricity Market and Portuguese Retail Market

“…Participation in the wholesale market via Aggregator is not a new concept [16,[18][19][20][21][22][23][24]] however they usually only consider one asset. Works [16,21] use the well-known DR asset to participate in the market.…”

“…In [20], an aggregated model of RES is used to participate in a real-time market. At industrial level the aggregator can also perform some services, such as this approach [23] where its services are used to facilitate industrial demand response. In reference [24], the authors propose a framework for comprehensive market participation of DER Aggregators.…”