Using Temperature Sensitivity to Estimate Shiftable Electricity Demand Implications for power system investments and climate change

Michael Roberts, Sisi Zhang, Eleanor Yuan, James Jones and Matthias Fripp
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Sisi Zhang: University of Hawai‘i at Manoa Department of Economics
Eleanor Yuan: University of Hawai‘i at Manoa Department of Economics
James Jones: Northern Virginia Electric Cooperative
Matthias Fripp: University of Hawai‘i Economic Research Organization, Department of Electrical Engineering, University of Hawai‘i

No 2021-3, Working Papers from University of Hawaii Economic Research Organization, University of Hawaii at Manoa

Abstract: Growth of intermittent renewable energy and climate change make it increasingly difficult to manage electricity demand variability. Transmission and centralized storage technologies can help, but are costly. An alternative to centralized storage is to make better use of shiftable demand, but it is unclear how much shiftable demand exists. A significant share of electricity demand is used for cooling and heating, and low-cost technologies exists to shift these loads. With sufficient insulation, energy used for air conditioning and space heating can be stored in ice or hot water from hours to days. In this study, we combine regional hourly demand with fine-grained weather data across the United States to estimate temperature-sensitive demand, and how much demand variability can be reduced by shifting temperature-sensitive loads within each day, with and without improved transmission. We find that approximately three quarters of within-day demand variability can be eliminated by shifting only half of temperature-sensitive demand. The variability-reducing benefits of employing available shiftable demand complement those gained from improved interregional transmission, and greatly mitigate the challenge of serving higher peaks under climate change.

Pages: 41 pages
Date: 2021-09
New Economics Papers: this item is included in nep-ene, nep-env and nep-isf
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https://uhero.hawaii.edu/wp-content/uploads/2021/09/UHEROwp2103.pdf First version, 2021 (application/pdf)

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Working Paper: Using Temperature Sensitivity to Estimate Shiftable Electricity Demand: Implications for power system investments and climate change (2022)
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