As part of Germany’s ambitious Energiewende, or energy transition, policymakers are mapping out an economically efficient path to accommodate a steadily increasing supply of renewable energy resources. With stakeholders proposing competing pathways to reliably incorporate renewable energy, senior associate Andreas Jahn injected a dose of reality into the debate. In the German newspaper Tagesspiegel, he points out that, while customer loads can be modulated up or down in real time in response to wholesale market conditions, Germany does not yet recognize or value the contribution of demand response to system reliability. Mr. Jahn warns that ignoring the potential of demand response could be an expensive oversight, no matter which pathway to integrating renewables is ultimately taken. “If the market rules were applied on an equal basis to all participants, then end-users could also deliver a meaningful contribution to the system” he said, calling attention to the ability of demand response to balance the variability of renewable resources.

Klaus Töpfer, Head of the Institute for Advanced Sustainability Studies (IASS), agrees. He emphasized that there are other options for lowering the cost of the Energiewende — aligning demand with the fluctuating generation from wind and solar, would require lower amounts of more expensive conventional balancing energy. For more information, see RAP’s Nachfragesteuerung im deutschen Stromsystem: die unerschlossene Ressource für die Versorgungssicherheit, which highlights international experience with demand response as a power system resource, and makes recommendations for market reforms in Germany.