• Demand Response
  • Distributed Energy Resources
  • Distributed Energy Technology
  • Climate Change

Residential Demand Response: Coming to a Region Near You

Jessie Mehrhoff
Apr 02, 2019

Solar 10

As a student of North American environmental policy and economics, one of the questions I find most challenging is whether the developing world should be asked to restrain fossil-fueled economic growth as a means to help stave off the worst effects of global climate change. The US’ $19+ trillion GDP was founded upon the use of fossil fuels, and only in the past few decades has the transition to clean distributed energy truly taken off.

Is it fair to ask the same of countries who are beginning to industrialize in the early 21st century? While that question likely can’t be answered in a short blog (or long book for that matter), Navigant Research’s recent report, Market Data: Residential Demand Response, indicates that every region of the world is expected to promote grid stability through residential demand-side management programs in the coming decade.

Residential demand response (RDR) programs are designed to reduce electricity loads from aggregated households by giving grid operators or systems aggregators access to the home’s grid-connected technologies. While residential electricity loads pale in comparison to those of commercial and industrial companies, the development of RDR programs symbolizes a global understanding of the need for responsible electricity consumption.

Global RDR Growth

In 2019, RDR programs are present in North America, Europe, and the Asia Pacific. Navigant Research predicts RDR will next come online in the Middle East & Africa by 2020, followed by Latin America in 2022. By 2028, over 47.4 GW of RDR capacity will be available worldwide.

Realistically, the new report forecasts that regions of the world without RDR programs in 2019 will make up less than 1% of total RDR capacity by 2028. Several reasons for this delayed growth include:

  • Programs will be newer and operating in the proof of concept phase
  • The presence of RDR programs typically follows that of commercial and industrial demand response (CIDR)
  • Global RDR might target electricity-consuming technologies other than HVAC

As technology and program developers around the world integrate a variety of grid-connectable devices such as water heaters, battery storage, and EV supply equipment into RDR, programs might become more useful in other regions of the world. While there is a general understanding that access to electricity improves quality of life, it might also be possible to leapfrog directly to programs that reduce excess electricity consumption and improve grid reliability in industrializing regions.

A Glimpse Into the Future

Speculation exists as to what future RDR programs will look like worldwide, let alone in regions like the Middle East & Africa and Latin America. Policymakers, innovators, and academics worldwide provide a vote of confidence that these programs are being actively explored.

Dubai’s Integrated Energy Strategy 2030 explicitly contains a DSM component that includes DR. The city hopes to become a role model in a region of the world where many electricity rates are relatively low due to proximate fossil fuel production. In Latin America, the Brazil Electricity Regulatory Agency approved the restructuring of tariffs to support a dynamic-pricing mechanism partially in preparation to advance RDR programs.

While RDR programs in the Middle East & Africa and Latin America might develop sporadically, successful measures that increase residential customer savings and provide evolving grids with excess capacity will likely be seen in a favorable light. I look forward to the use of RDR as a sustainability tool to be implemented as countries worldwide help to fuel their residents’ increasingly device-connected lives.