The impact of demand side management strategies in the penetration of renewable electricity

High fuel costs, increasing energy security and concerns with reducing emissions have pushed governments to invest in the use of renewable energies for electricity generation. However, the intermittence of most renewable resources when renewable energy provides a significant share of the energy mix can create problems to electricity grids, which can be minimized by energy storage systems that are usually not available or expensive. An alternative solution consists on the use of demand side management strategies, which can have the double effect of reducing electricity consumption and allowing greater efficiency and flexibility in the grid management, namely by enabling a better match between supply and demand. This work analyzes the impact of demand side management strategies in the evolution of the electricity mix of Flores Island in the Azores archipelago which is characterized by high shares of renewable energy and therefore the introduction of more renewable energy sources makes it an interesting case study for testing innovative solutions. The electricity generation system is modeled in TIMES, a software which optimizes the investment and operation of wind and hydro plants until 2020 based on scenarios for demand growth, deployment of demand response technologies in the domestic sector and promotion of behavioral changes to eliminate standby power. The results show that demand side management strategies can lead to a significant delay in the investment on new generation capacity from renewable resources and improve the operation of the existing installed capacity. (C) 2011 Elsevier Ltd. All rights reserved.