Preferences for curtailable electricity contracts: Can they benefit consumers and the electricity system?
Growth in electricity demand together with the expansion of variable renewable energy will have significant implications for the future electricity system. One main concern is how the system can maintain balance between supply and demand to avoid blackouts from potential intermittent supply shortages. At present, this balance relies primarily upon traditional sources of flexibility on the supply side i.e. from the conventional power plants. With the transition underway to a more decarbonised system, new sources of flexibility are required including on the demand side. End-use specific curtailable electricity contracts are an instrument that could help increase demand flexibility, whereby utilities compensate a consumer to get access to their load to either interrupt it entirely or to curtail it to some degree during periods of system instability. It is end-use specific in that the load curtailed is directly related to the final energy service provided, for example, a remotely operated power button on a washing machine. In this context, this research examined consumer preferences for these types of contracts on household appliances in Ireland during the peak load hours between 5pm and 8pm.