Experiences and Lessons Learned From DR Resources Participating in the US and UK Capacity Markets: Mechanisms, Status, Dilemmas and Recommendations

Abstract

The role of demand response resources is particularly important under the new-type power system with new energy as the main source. Demand response resources are important for generation adequacy and can provide electricity capacity value for power system. The United States and the UK are the only countries in the world that offer capacity services from demand response resources as generation resources. Their experiences and lessons learned are of great significance to other countries and regions. This paper first analyzes the significance of DR resource participating in the capacity market from two perspectives: the development of demand response resources and system generation capacity. Secondly, a detailed analysis of the mechanism design of demand response resources in the US capacity market is presented and the development status of demand response resources since 2007 is provided, so as to provide meaningful reference for other countries and regions. Thirdly, this study introduces the current situation and dilemma of demand response resources in the capacity market of the UK, and provides corresponding suggestions so that demand response resources in other countries and regions can avoid repeating the pace of the UK in the capacity market. Finally, suggestions for demand response resources to participate in the capacity market are given from four aspects.

Keywords

• Demand response
• capacity market
• market mechanism
• status
• dilemmas
• recommendations