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Barriers to Electricity Load Shift in Companies, a Survey-Based Exploration of the End-User Perspective

Mark Olsthoorn, professor and researcher at Grenoble Ecole de Mangement
Publié le
07 Avril 2015

Overcoming the barriers to renewable energy systems is a key challenge. In shifting from centralized fossil-fuel energy production to decentralized solar and wind energy production, countries are being forced to act on multiple fronts : flexible backup solutions, improved storage technology, smart grids and active load management.

This article by Mark Olsthoorn is the subject of the 13th GEM LAB Executive Summaries.

While significant research exists on the implementation of energy efficiency measures, the authors of this study have, for the first time, empirically explored the barriers to load shift practices. Despite the use of load shift for emergency situations, this practice has not been adopted on a wide scale. To better understand this blockage, the study surveyed manufacturing companies located primarily in Southern Germany where the question of load shift adoption is pertinent due to the increase in solar power and phasing out of nuclear power by 2022.

Cheaper, more reliable energy...

From the Article

Barriers to electricity load shift in companies : A survey-based exploration of the end-users perspective Energy Policy 76 (2015) 32 - 42 - http:// dx.doi.org/10.1016/j.enpol.2014.11.015 Mark Olsthoorn, Joachim Schleich, Marian Klobasa, 2014

The advantages of load shifting are many: increased energy capacity, less demand for new energy sources, improved grid reliability, lower network congestion, stabler prices and even lower prices for the end-user. In other words, this practice fits perfectly with the goal of secure, affordable and clean electricity. In the face of such obvious benefits, why has load management not been implemented in companies around the world ?

Fear of operational disruptions is clearly the pre-dominating barrier. Participating companies showed concerns about the interruption of production processes and the impact on product quality. However, as few of the participants had previous experience in load shift practices, the authors suggest that these reservations are based on priorities rather than experience.

A cloudy vision of finance and regulation

Without a clear vision of the financial impact of load shift practices, respondents feared low cost savings, additional operating costs and other unknown expenditures. In addition, the regulatory framework of energy production is in constant evolution. Concerns of regulatory uncertainty underline the importance of understanding when and how regulatory conditions will affect load shift practices.

Surprisingly, an analysis of company characteristics did not determine size to be a significant factor for company perception of barriers. However, companies that place higher strategic value on electricity had greater concerns about technical, financial and regulatory risks, and companies with continuous production processes reported lower barriers to load shift adoption. This analysis offers guidance for future energy management research and policy-making.

Key points

  • Widespread adoption of load shift practices is hindered by three key concerns: disruption of operations, impact on product quality and uncertainty of cost savings
  • To achieve the best outcome in energy management, research and policy-making must simultaneously address energy efficiency and load shift practices.