Many words refer to what seems to be an action, a management of the demand for electricity: flexibility, demand management, peak shaving, load shedding.
Do they refer to the same actions? Are these actions complementary or antagonistic? Or are they the evolution in time of the same concept?
To clarify the issue, it is necessary to consider the state of maturity or development of a national (in most cases) energy system.
When a country’s electricity production capacity is undersized and only part of its needs are met, the country is often in a shortage situation: it is therefore necessary to arbitrate between consumers and define those who must benefit primarily from the available electricity. This decision is eminently political, always favors industry and sensitive sites (hospitals). The way to adapt demand in this case is to shed non-priority customers. It is brutal but unambiguous.
The situation can occur in the case of a large consumer, since the energy available to him is limited, either by contract or by lack of production capacity.
The first mode of action used is to shed non-priority loads, even if they suffer from the minor consequences of their shedding. This action mode concerns emerging countries, developed countries during the post-war period and the least mature actors in terms of energy demand management.
When the shortage situation mentioned above has been solved, only a few periods in the year show a deficit between production and consumption. These “peaks” of consumption correspond very often to peaks of activity of the thermal applications (heating in winter period, air conditioning in periods of very high heat).
Preferred modes of action to manage these periods are based on an incentive for consumers to decrease their consumption in exchange for economic advantages. Either a specific tariff is designed for this purpose (like the former EDF’s EJP tariff in France), or energy companies design an incentive program to which consumers can subscribe.
The “decision to act and participate” is therefore often left to consumers to shed loads. It is referred to as load shedding or shifting, to designate the action itself or peak shaving to describe its effect.
This mode of action concerns the developing countries, the most developed countries until the yeas 2000 and the actors in the childhood of the demand side management.
For many reasons, a country’s generation capacities may become oversized even during peak periods. Electricity now has a variable cost, depending on production technologies or period. The challenge, in this context, is to match, at any time, production with consumption. The means of action, available to adjust production are fewer than before: some sources of production are not easily adjustable (solar, wind), others operate only intermittently. Consumers are therefore increasingly being asked to participate in the balancing mechanisms and to adjust their level of consumption.
This adjustment activity must be permanent, upward or downward. It is no longer linked to consumption peaks; it is an integrated part of network management and balancing mechanisms. In particular, all water, gas or heat distribution networks have a strong capacity to participate in these balancing mechanisms, offering a high level of flexibility in electricity consumption. The same applies to large heat pumps or co-generation facilities. Thus, all the components of an energy system, being linked, participate in its own balance and proper operation.
This mode of “total” flexibility concerns the industrial countries, the countries that have developed strong renewable energies and the most advanced actors.
Observing existing demand side management activities can be an indicator of a country’s sizing of electricity generation capacities, as well as an indicator of the demand-side maturity of an energy player. It is important not to stay at the word level. I am surprised to hear large famous energy players speak today of flexibility to mean load shedding activities valued with difficulties!