Optimising the grid with heat pumps and demand response

An area of the energy transition sometimes overlooked is that of the heating and cooling of buildings. Fossil-fueled gas boilers are still by far the popular choice due to their efficiency and price, but they are simply not sustainable.

And getting consumers to buy into the flexible option presented by heat pumps, according to speakers at European Sustainable Energy Week (EUSEW), will be critical for driving home climate targets.

Heat pumps do have immediate benefits at a glance, however, they are more expensive and can place strain on the grid when used at scale.

“The whole point behind heat pumps is that they are energy efficient – they use twice as less, maybe more, than any other source of heating. That’s only if you consider heat pumps individually. There is a mystery about them in the context of the grid; when you switch all those boilers over to heat pumps, which use more electricity, one creates issues in the grid.”

So stated Pierre Bivas, founder and CEO of Voltalis and board member of SmartEn.

“The good thing though is that heat pumps are flexible. Heating is flexible. One can avoid heating during certain periods to avoid the issues in the grid. This is how it can help the grid.”

Voltalis is a heat pump aggregator, operating flexibility from heat pumps and other electrical appliances in several European countries, with a focus on buildings, whether for homes or businesses.

According to Bivas, the installation and set up is relatively simple.

An engineer installs a box next to electrical appliances, such as radiators, heat pumps, electric vehicles or water boilers, which can then become flexible without the consumer noticing.

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“They can be stopped for 13 minutes or so and the consumer isn’t affected. These flexible loads will be identified by the electrician and they install a small device connected to a remote platform.

“As soon as it’s installed – which in most cases takes between one and 1.5 hours – the consumer will also have direct access over the internet to the detailed data of their consumption across appliances. This is hoped to also raise awareness of where their energy costs comes from, providing insight and encouraging them to be more active with their energy use and management,” he explained.

Bivas detailed the case for heat pumps as a flexible asset where, when used within a demand response-driven scenario, they can provide an extreme level of alleviation for the grid, which many fear harming with heat pump uptake – a contradiction in terms.

“We operate demand response by monitoring interconnected heat pumps to deliver flexibility. We operate them in ways to avoid and alleviate grid issues. And what we have found is that consumers are very happy to participate, which they can do free of charge. Happy consumers mean flexibility and flexibility means a happy grid. This idea should be incorporated more often into utility business models.”

Heat pump participation

What this brings to the fore is the question of how to encourage consumers to partake in such programmes. Bivas stated that because their programme is free, consumers are encouraged to partake, but at the end of the day, this is not the main driver for their efforts.

Rather, a sense of empowerment and supporting the very real issues that have been coming onto everyone’s radar – support of an ailing grid – is what drives this participation.

“It’s the one thing they can do to help with the grid and reduce the use of fossil fuel gas. However, someone must pay for all these solutions we are providing, which is free of charge for consumers.”

And this is where demand response comes in.

“Allowing demand response to participate in the wholesale market as an alternative to generation is what [pays up]. Overall, it’s cheaper, takes the prices down and is a way to provide revenue to aggregators so that they deliver the service free of charge.

“When prices are high, reducing heating by a minimal amount [across an asset portfolio], means prices are reduced exponentially at our scale, which translates to major savings, [both financial and for energy efficiency]. The net benefits can thus be spread across consumers, who participate free of charge.”

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Heat pumps within the larger VPP scenario

The numbers for this type of effort really do add up. When an aggregator hosts a virtual power plant (VPP) – a cloud based system of connecting and utilising behind the meter (BTM) assets to coordinate flexibility – the results can be impressive.

Heat pumps are but one of these assets. And Voltalis has an extensive portfolio for this type of work – 150,000 subscribers, translating into millions of appliances being remotely controlled. Putting this together and thinking of the efficiency that is made possible is quite a picture.

“We’re all connected through a grid and a single market, which means that when some of us accept to be flexible – accepting that our heat pumps will be stopped for 15 minutes, translating to a drop in temperature by between 0.1 to 2 degrees Celsius, which can’t be felt and isn’t an inconvenience – all will be able to contribute to the energy transition.

“And the most important thing to note here is that it works. Technically speaking, it works perfectly. Economically speaking, it can work only in those countries that have opened their market to demand response as an alternative to generation.

“And this needs to be the case for all 27 European countries. Part of the Clean Energy Package is to open the market to demand response, yet some countries do not participate,” Bivas added.