Dr. Paddy Finn:

On behalf of the Demand Response Association of Ireland, DRAI, I thank the committee for the invitation to join the meeting today and for the opportunity to shine a light on the increasingly important role that demand response has been silently playing in the operation of Ireland's electricity system. The electricity system can be represented by the analogy of a seesaw, finely balancing customers on one side with generation on the other. The objective is to ensure a perfect balance between the two. Otherwise, there is a loss of equilibrium, which risks a blackout.

With customers being unconstrained in their use of electricity, balance has traditionally been managed by controlling the fuel supply to power plants in real time to match generation to demand. As we increasingly turn to the wind and sun as our sources of fuel, the availability of which is dictated by nature rather than by pipelines and financial contracts, we must look to supplement our ability to balance the grid by other means. The raison d'êtreof any electricity system is to deliver power to electricity customers reliably and cost-effectively. We must achieve this with minimum impact on our environment and natural resources.

Through the use of enabling technologies, demand response unlocks flexibility in how, when and where customers use electricity to turn consumption into a tool in the operation of the power system. After all, when balancing the grid, reducing electricity consumption has the same net effect as increasing generation, but uses the latent underlying capability of existing resources, minimising the need for additional infrastructure.

DRAI represents Ireland’s leading demand response aggregators, which, between them, enable 700 MW of electricity customers’ resources to provide services to the electricity system operators, with 200 MW being made available on average over the past 12 months, according to EirGrid's outturn availability data. Ireland’s electricity system requires the top 200 MW of peak demand for approximately eight hours in a typical year. Building an open-cycle gas turbine peaking plant to meet this final 200 MW of annual demand would cost in excess of €120 million and, with no such generator manufacturer in Ireland, the majority of this value will leave the Irish economy.

Furthermore, according to data from the National Renewable Energy Laboratory, the construction alone of such a plant would result in the order of 100,000 tonnes of greenhouse gas emissions. This is significant in the life cycle of carbon emissions of a peaking plant that will only operate for a few hours per year and is often overlooked when considering the carbon intensity of our electricity supply.

Demand response leverages the latent capability of existing assets to minimise the considerable costs, resource depletion, and carbon emissions associated with building new infrastructure, and retains value in Ireland’s economy. Unlike other technology types with characteristics that remain static over their lifetimes, demand response is flexible and responsive. Through technology enablement and portfolio management our members have evolved the characteristics that participating customers provide as the power system has evolved.

Among our members’ portfolios are customer groups that are capable of: reducing consumption within 150 milliseconds to compensate for the tripping of other generation plant on the grid; reducing consumption on short-notice instruction to balance the power required by other customers at times of peak demand; increasing consumption to minimise the need to curtail renewable energy at times of abundance; and reducing consumption for long periods, in excess of 24 hours, if needed. These capabilities are typically sought from peaking power plants or energy storage systems but can be reliably and efficiently delivered by demand response also.

DRAI members’ portfolios delivered time and time again throughout the past winter and were heavily utilised to mitigate the widely publicised generation constraints that Ireland experienced. We are being called upon to grow our portfolios and increase our availability in anticipation of further challenges next winter. However, current limitations on electricity market incentives for demand response remain an obstacle to growth. I will now hand over to Ms McHugh.