The expansion of renewable energies and the resulting gain in fluctuating power input are increasing the need for more flexibility in the electric power system. One option for providing more flexibility in the electric power system is to match electricity consumption more closely with electric power generation – so-called ‘demand side management’ (DSM) – by operating loads on the basis of price signals. This can help to integrate fluctuating renewable energies into the electric power system, balance production and demand fluctuations, provide balancing energy and relieve congested grid sections. At the same time, companies can tap new sources of income by actively marketing their flexible loads.
Today, China lags behind other countries in utilizing DSM. The power demand side is still adopting one-way regulation by administrative means. Institutional barriers such as a lack of competitive electricity markets and the absence of mature business models are preventing the commercialization of DSM.
Although China's DSM programs have high potential to succeed, they require substantial efforts in resolving key issues.
The German Energy Agency (dena) has recently published a background paper that provides insights into DSM market fields in Germany and shares experiences from two major DSM pilot projects in the south of Germany. The report demonstrates a joint collaboration between dena and CNREC.