What is the Potential Net Benefit of Demand-Side Management For a Co2 Free Electricity System?

This paper examines the potential net benefit of demand-side management for climate-friendly electricity production systems: how will alternative load profiles impact total system cost of electricity generation? To answer this question, we have constructed an electricity system for Europe where total system cost is minimized, subject to imposing no rationing of consumers and no CO2 emission from electricity generation. The constrained minimization problem is solved using hourly, spatial data for 23 European countries that covers 2702 grid cells for a period of 10 years.Two frameworks for manipulating the path of hourly load are developed. First, the load profile for each day is evened out for each country, but total daily consumption of electricity is imposed to be fixed. We find that even in the corner case of constant, hourly consumption of electricity within each day, system cost hardly changes. Second, hourly consumption is changed subject to alternative behavioral constraints that are combined with keeping total daily consumption of electricity constant. With the latter framework, which has more flexibility than the first one, investment in total renewable capacity is hardly changed, investment in energy storage capacity decreases radically, and total system cost drops significantly