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The Energy Code (article L271-1) defines demand response as an action intended to temporarily reduce, in response to a one-time request sent to one or more consumers by a demand response operator or electricity supplier, the electricity effectively withdrawn from the public transmission or distribution network at one or more consumption sites, relative to a consumption plan or consumption estimate.

Market players can use demand response to optimise their own portfolios or to sell energy directly to other players or to RTE. There are two main categories of demand response that contribute to the supply-demand balance:

  • Industrial demand response, when consumption is reduced at one or more industrial sites (either by shutting down processes or by switching over to own consumption). This type of demand response can be proposed either directly by the industrial user or through an aggregator or supplier.
  • Distributed demand response, or the aggregation through an aggregator or supplier of individual demand response actions involving smaller volumes, all carried out at the same time by residential or professional customers.

Learn more about demand response in our magazine Mag RTE & Vous

Demand response is remunerated through a variety of mechanisms


  • France was the first country in Europe to open all parts of its national market to all consumers, including those connected to the distribution networks:
    • Since 2003, it has been possible to offer industrial demand response on the balancing mechanism.
    • Since 2008, RTE has been contracting with BRPs for demand response capacity to guarantee the availability of their capacity to the balancing mechanism.
    • Since 2011, RTE has been contracting demand response capacity that can be activated on very short notice for the mFRR (manual frequency restoration reserves). In 2018, demand response capacity made up more than half of the rapid reserve.
    • Since January 2014, it has been possible to sell demand response energy directly on energy markets through the NEBEF mechanism.
    • Since July 2014, industrial customers have been able to participate in frequency ancillary services by offering demand response (1 MW minimum). These reserves, which can be automatically activated in timeframes ranging from a few seconds to a few minutes, are critical to keeping supply and demand balanced. Previously, only generation facilities could participate. In 2018, demand response capacity contributed 10% of the FCR (frequency containment reserve).

    In 2018, demand response tenders became a support mechanism for the demand response sector. Organised by the Ministry of Energy, the tenders encourage the creation of demand response capacity to meet the targets set forth in the multiannual energy programme.

 

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Demand response on the balancing mechanism


The average demand response volume offered on the balancing mechanism was 727 MW, in line with 2017.

A total of 22 GWh of demand response was activated on the balancing mechanism, primarily in the winter, during the cold spell in week 9. The 1st of March alone accounted for 6 GWh, a record for a single day.

On the 1st of March, more than 1,000 MW of demand response was requested on the balancing mechanism, the highest value ever.

Demand response capacity activated exceeded 100 MW on 15 days in 2018.

 

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The NEBEF mechanism


The NEBEF mechanism (Demand Response Block Exchange Notification) allows market actors to realise value on demand response directly through the market. They inform RTE of the demand response they plan to activate the next day and can now re-declare schedules at the intraday scale. RTE verifies afterward that the volumes correspond to the schedules submitted by participants.
To date, 23 demand response operators have signed contracts with RTE to participate in the mechanism.

Demand response volumes selected reached 27 GWh, which was lower than in 2017 but higher than in 2016. A significant gap was notably observed between January 2018 and the same month in 2017, when supply was tighter and prices were higher. There were few instances of significant demand response volumes being activated (more than 100 MW) but distributed demand response volumes increased.

 

Note: Final demand response figures for November and December are not yet available.

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