An Assessment of the CO$_2$ Emission Reduction Potential of Residential Load Management in Developing and Developed Countries

Alona Zharova and Felix Creutzig

Papers from arXiv.org

Abstract: Intermittent renewable energies are increasingly dominating electricity grids and are forecasted to be the main force driving out fossil fuels from the grid in most major economies until 2040. However, grids based on intermittent renewables are challenged by diurnal and seasonal mismatch between supply of sun and wind and demand for electricity, including for heat pumps and electric two and four wheelers. Load management and demand response measures promise to adjust for this mismatch, utilizing information- and price-based approaches to steer demand towards times with high supply of intermittent renewables. Here, we systematically review the literature estimating CO$_2$ savings from residential load management in developing and developed nations. We find that load management holds high potential, locally differentiated with energy mix (including the respective share of renewables and fossils), climate zone, and the regulatory environment and price mechanism. Most identified studies suggest a mitigation potential between 1 and 20%. Load management becomes more relevant with higher shares of intermittent renewables, and when electricity prices are high. Importantly, load management aligns consumers' financial incentives with climate change mitigation, thus rendering accompanying strategies politically feasible. We summarize key regulatory steps to facilitate load management in economies and to realize relevant consumer surplus and mitigation potential.

Date: 2025-04
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