FLEXCoop is a great opportunity for cooperatives to explore demand-side flexibility business models. Being able to use consumers-flexibility opens the field to a whole range of new roles, from the more conventional use of flexibility as an aggregator-retailer, to aggregation for providing grid services or to support to self-consumption.
Flexibility services by a retailer-aggregator
Electricity may be sourced on the market or directly from the retailer generation portfolio. In both cases consumer flexibility is an important tool to use electricity when it is the most abundant and therefore the cheapest.
The retailer is the intermediate between the end-user and the production of electricity. In its supply offer, the retailer may propose the automation of appliances to facilitate consumption at time of generation. This is the role fulfilled by Som Energia as FLEXCoop pilot.
Aggregation for system operation services
An aggregator is a market actor who combines multiple customer loads or generated electricity in order to sell them as one single resource on electricity markets. The aggregator may be different from the retailer.
The (independent) aggregator’s role in this case is to use New communication technologies to pilot a set of small connected units (generation, storage, consumption) to act as one pooled resource to support the grid. This can take place at local level, supporting DSO in managing congestion management, or at the overall system level, providing helping the TSO to balance the grid.
This role is taken on by Energie Samen and Endona as FLEXCoop pilot where they intend to provide secondary reserves to the Dutch TSO.
Self-consumption is the ability to consume electricity generated on-site, or in close proximity. It involves the capability to generate electricity locally (e.g. solar photovoltaic) and to consume this electricity either by consuming at time of generation or using storage. Self-consumption can take place at individual level (single house), or at collective level in multi-tenant building, or through “virtual connection” to a remote generation facility.
An Energy Service Company (ESCO), can facilitate self-consumption by automating appliances, installing metering equipment, and making sure electricity is consumed when generation is available, e.g. heating water during the day when the rooftop PV installation generates instead of at night. Adopting this scenario, an ESCO can extend its role by installing generation equipment and maintaining it.
This role is taken on by Som Energia as FLEXCoop pilot where the co-op intend to support their members with roof-top PV to consume most of their self-generated electricity.
More information demand-side flexibility business models is available in our report D2.7 Emerging Business Models, Associated DR Strategies and Standard Contracts Templates – Final Version