How demand management supports security of supply

Site resilience and Demand Side Response are often seen in opposition. But the reverse is true – and can in fact be mutually advantageous, especially if your business could benefit from improving security of supply.

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Site resilience and Demand Side Response are often seen in opposition. But the reverse is true – and can in fact be mutually advantageous, especially if your business could benefit from improving security of supply.

For many businesses, suffering an interruption to your power supply can be costly as well as inconvenient.

“We have been working on an on-site battery solution with a customer who manufactures precision-made components,” says Richard Spencer, Head of Site Services at npower Business Solutions’ Energy HQ. “This is because each time they experience a ‘Brown out’ – that is a momentary interruption in grid voltage or capacity – the resulting loss of machine accuracy and subsequent waste of materials can cost them in excess of £200k.”

Brown outs are far more common but have a lower public profile than Black outs, where multiple consumers across an area are deprived of power for a period of time.

“Brown outs are intentionally or unintentionally produced by the grid as an emergency measure to prevent the electricity distribution system from failing completely, causing a Black out,” explains Richard. “They may not involve a full loss of power – more often fluctuations in voltage or capacity. However, this can damage equipment – especially motors or sensitive technology – and can even cause a whole site’s plant to shut down, which then creates a far longer time delay while it’s all powered up again.”

The frequency of Brown outs can depend on location – for example, they are more common in built-up industrial areas, or areas where there are sustained high-energy requirements at peak times. Other causes are unplanned power station outages, producing further stress to the distribution network.

The solution is investing in Uninterruptable Power Supply (UPS) assets. “This involves a business installing on-site battery and/or generation assets, along with the technology that can sense any tiny changes in the grid’s supply and then react in milliseconds, triggering immediate standby power,” explains Richard.

But understandably, creating what’s known as ‘island mode’ capability is often costly. “This is where Demand Side Response (DSR) comes in, as by using those same on-site assets to generate or release power at opportune times, you can also reduce peak charges and even earn revenue – for example, by selling unused volume during market peaks or by participating in National Grid balancing schemes,” explains Richard. “This obviously brings the overall cost down, and often provides a net benefit.”

However, despite the potential financial advantages, some businesses still have concerns that using these key assets at other times may impede their ability to respond when they are really needed.

“There’s a common misconception that participating in DSR somehow depletes on-site resilience,” says Energy Manager Maxwell Evans, who oversees DSR participation across the npower portfolio, including at key customer call centre sites. “But for me, the opposite is actually true. It’s certainly one of the key benefits of DSR that appeals to me, as if you regularly exercise an on-site generation asset, you minimise the risk of operational issues and reduce the likelihood of fault or failure. The generator engine also benefits from operating regularly at full load.”

This is a benefit that also appeals to Phil Downing, Senior Business Resilience and Crisis Management Expert from innogy’s Group Security and Business Continuity Team, part of npower’s parent company. “If done correctly and with the proper planning, DSR can really enhance the Disaster Recovery position of a site by regularly testing the generators under genuine load conditions,” says Phil.

Ensuring security of supply is an essential part of juggling the modern-day energy trilemma – balancing what at times seem like opposing needs for energy affordability, security and environmental sustainability.

“DSR plays a key role in the energy trilemma,” says Richard. “It touches all three corners of the triangle. It also impacts and supports our low-carbon future, as greater volumes of decentralised and often renewable energy come on line. DSR provides an ideal tool to help balance more diverse generation and ensures consumers become part of the solution.”

For more on how DSR contributes to the UK’s low-carbon future, see our article here.

And for more on how DSR can make your energy more affordable, see our article here.

Check out the DSR Clinic from Energy HQ here.

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