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

27 Pages Posted: 17 Jan 2020

See all articles by Jan Stede

Jan Stede

German Institute for Economic Research (DIW Berlin)

Karin Arnold

Science Centre North Rhine-Westphalia - Wuppertal Institute for Climate, Environment & Energy

Christa Dufter

Research Center for Energy Management

Georg Holtz

Science Centre North Rhine-Westphalia - Wuppertal Institute for Climate, Environment & Energy

Serafin von Roon

Research Center for Energy Management

Joern Constantin Richstein

German Institute for Economic Research (DIW Berlin)

Date Written: January 2020

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.

Keywords: aggregator, demand response, barriers, function, roles, industry, interview

JEL Classification: D22, L23, Q40, Q41

Suggested Citation

Stede, Jan and Arnold, Karin and Dufter, Christa and Holtz, Georg and von Roon, Serafin and Richstein, Joern Constantin, The Role of Aggregators in Facilitating Industrial Demand Response: Evidence from Germany (January 2020). DIW Berlin Discussion Paper No. 1840 (2020). Available at SSRN: https://ssrn.com/abstract=3520592 or http://dx.doi.org/10.2139/ssrn.3520592

Jan Stede (Contact Author)

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstraße 58
Berlin, 10117
Germany

Karin Arnold

Science Centre North Rhine-Westphalia - Wuppertal Institute for Climate, Environment & Energy ( email )

Döppersberg 19
Gelsenkirchen, D-45886
Germany

Christa Dufter

Research Center for Energy Management ( email )

Germany

Georg Holtz

Science Centre North Rhine-Westphalia - Wuppertal Institute for Climate, Environment & Energy ( email )

Döppersberg 19
Gelsenkirchen, D-45886
Germany

Serafin Von Roon

Research Center for Energy Management ( email )

Germany

Joern Constantin Richstein

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstraße 58
Berlin, 10117
Germany

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