The flexibility deployment of the service sector - a demand response modelling approach coupled with evidence from a market research survey

The flexible use of energy is seen as a key option to facilitate the integration of volatile renewable energy sources (RES) into the electricity sector. In this study, we focus on flexibility in the service sector, in terms of flexible technologies, experiences and willingness to participate in demand response (DR) actions. We analyse the technically possible future deployment of flexibility, the practically possible deployment of flexibility and also take the reduction of RES surplus electricity into account. Our results are based on survey data from over 1.500 service sector companies (offices, trade, hospitality) and modelling results with a time resolved DR model (eLOAD). The data show that service sector companies have few experiences in DR so far, which is among others caused by the unfavourable regulatory conditions to participate in flexibility markets. The currently most common forms of DR are load shedding and flexible tariffs and optimized purchase of electricity. Participation in DR varies between subsectors and company sizes, but on average all subsectors are interested in extending (automated) DR measures in the future. Our projections result in a possible technical deployment of flexible electricity of 7.74 TWh of which about 510 GWh can be used to reduce renewable surplus electricity (in case of a 50% RES share). In case of a 80% RES share, this can reach 1.63 TWh. Integrating the willingness of companies to participate in DR, the practical possible deployment results in 131 GWh reduction of renewable surplus electricity. This can be interpreted as a first-mover potential for DR. Future increased need for flexible demand could raise the profit for the companies and their willingness in participating in DR. Further analyses on most promising target groups of companies would help to tap the potentials and to create market offers as well as policies to incentivise participation.