Spain secures 609MW demand response capability for new year
Image courtesy Red Eléctrica
The mainland electricity system in Spain will have 609MW of demand response capability in 2024 from consumers and retailers who participate directly in the wholesale electricity market.
According to Spain’s TSO Red Eléctrica, the figure represents an increase of nearly 23% compared to the first auction, which came into force in 2022.
The demand response service is an energy-balancing mechanism within current regulations to guarantee the necessary balance between generation and demand. It can be applied in specific situations in which the system operator determines that there are not sufficient resources to maintain adequate reserves for the system.
The service is available to consumers and retailers with a demand of at least 1MW and, therefore, does not apply to domestic consumers or small companies. In this second auction, a total of 19 participants submitted their bids through the system operator’s online information system.
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Successful bidders will be remunerated with €40.82 ($44.09) per megawatt and per hour allocated in exchange for their availability to reduce their consumption in time periods established for the provision of the service.
On the other hand, the activation of the service will be remunerated at the then-current tertiary control price for the hour the service is requested.
Per the mechanism, the bidders awarded the service agree to reduce their demand, after being requested to do so with at least a 15-minute notice, for a maximum period of 3 hours per day.
The applicable period established for the activation of the service, in line with the auction terms and conditions, runs from 1 January to 31 December 2024.
Red Eléctrica in a release cites the potential of demand-side ancillary services in system operation to provide the system operator enhanced flexibility in system operations while promoting decarbonisation.
Countries such as France, Portugal and the United Kingdom also have different specific mechanisms for demand-side services that enable said countries to take advantage of such demand-side resources to help cover the flexibility needs that the electricity system operator may require.
