The Impact of Substituting Production Technologies on the Economic Demand Response Potential in Industrial Processes

Michael Schoepf, Martin Weibelzahl and Lisa Nowka
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Michael Schoepf: FIM Research Center, University of Bayreuth, 95444 Bayreuth, Germany
Martin Weibelzahl: FIM Research Center, University of Bayreuth, 95444 Bayreuth, Germany
Lisa Nowka: FIM Research Center, University of Bayreuth, 95444 Bayreuth, Germany

Energies, 2018, vol. 11, issue 9, 1-13

Abstract: Given the low carbon transformation of our energy systems, demand response has the potential to increase the adaptability of electricity demand to a volatile electricity supply. In this article, we investigate the demand response potential for the case where substituting technologies are available in an energy-intensive industrial production process. The available production technologies may not only differ in their technical characteristics, but also vary by the necessary input materials. We present a generic linear optimization model for such a production process and apply it to a real-world example in the paper industry. The results show that the question of which substituting technologies are used in an optimal production schedule to which degree, is highly influenced by the combination of current input parameters such as prices. In direct consequence, the corresponding demand response potential is not a fixed number. From an operational perspective, this input dependency implies that the price relation of raw input materials used in substituting technologies can be a crucial driving force for the ability and willingness of industrial enterprises to provide demand response. In addition, from a strategic perspective, long-run investments in demand response potentials may rely on expected price development of major input factors.

Keywords: demand response; demand response potential; load shifting; smart grid; load management; energy markets; decision support systems (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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