Demand Response- Potential, challenges & solutions in

Indian context

Introduction
The power sector in India has seen significant advancements in the areas of generation and
transmission in last few years, but further growth is limited due to inefficiencies in distribution. Rising
costs and constraints on tariff chargeable to consumers, and high AT&C losses have crippled the
finances of distribution utilities, which is why the gap between ACS and ARR is around Rs. 0.58/unit.
There are many schemes like R-APDRP, IPDS and UDAY has been launched by MOP for the improvement
of utilities finances, however the utilities condition is still deteriorating.
Innovative measures to curtail costs while benefitting consumers can be implemented with the help of
new technologies and methods such as advanced metering, monitoring and optimisation of load and
dynamic power pricing. Demand Response can be one such solution which can be implemented in the
short term and provide benefits to utilities as well as consumers in a sustainable manner.
Demand response is in its nascent stages in India. Its benefits can be seen in Western countries, such as
reduced electricity blackouts, reduced electricity costs, offsetting the need to build supply resource and
the ability to integrate electric vehicles, energy storage, renewable energy and other smart grid
elements. Regulatory framework also needs to be in place for implementation of Demand Response
strategies.

DR Potential in India:-
There is large diversity in the consumers to be served in India, it is necessary to identify the appropriate
consumers to be roped in for Demand Response to ensure the success of the program. Consumer
awareness and maintaining transparency with them must be a priority to win their confidence and
ensure acceptance of the Demand Response program. The electrical distribution network must be
strengthened to ensure reliability in operations. Also, to cater to the diverse needs of the consumers, a
variety of DR modules need to be prepared. Average demand for Power in India is around 130,000 MW
and the load distribution is as follows:-

Demand Response: - Potential, Challenges and solutions in Indian Context Page 1

 Power Comsuption( %) Distribution of Loads
Industrial
Motor Load: - 60%; Furnace: - 25%
10 Residential Chemical Process: - 10%; Lighting: - 5%
25
Commercial
20 Commercial
Industrial
10 HVAC: - 60%; Lighting: - 20%; Others:- 20%
Agriculture
35 Other Residential
Air-conditioner:- 60%
Other:- 40%

Fig. 1:- Load distribution in India

Curtailable load with Trigger time

S.No. Total Load (MW) %age Load curtailable Curtailable Load (MW) Trigger time (Hr) Event Period (Min)
Industrial (35%)
1 Furnace (25%) 11375 5 569 2 60
2 Motor (60%) 27300 2 546 2 30
3 Chemical Process (10%) 4550 5 228 2 60
4 Lighting (5%) 2275 10 228 2 120
Commercial (10%)
5 HVAC (60%) 7800 25 1950 1 30
6 Lighting (20%) 2600 5 130 1 30
7 Others (20%) 2600 0 0 0 0
Residential (25%)
8 AC(60%) 19500 25 4875 1 120
9 Others (40%) 13000 10 1300 1 120
Total Curtailable Load 9825

Fig.2:- DR Potential in India

Hence, there is around 10,000 MW of DR Potential in India with average trigger time of 2 hours
and average event period of 1 Hr.

DR could be carried out in various ways in India with open access consumers on DSM Bidding
model wherein OA Consumers can bid their DR Potential to Power Exchange through DR
Aggregator. There are around 3500 Open Access consumers in India who purchase power
through Power Exchange and average of 4500 MW power is traded daily through IEX. DR could
also be used as tool to tackle the wind generation variation through better forecasting.

Demand Response: - Potential, Challenges and solutions in Indian Context Page 2

DR Challenges in India:-
Poor Financial health of utilities: - Utilities in India are suffering from poor financial
conditions and they are focusing more towards the AT&C loss reduction, implementing basic
infrastructure, Quality of supply and other issues. DR is not the low hanging fruit for them
hence; they are not ready to focus on them.

Need to pay higher incentives to participants: - As per current situation, Utility need to
pay higher incentives to the participants to make them participate in regular manner which is
not a viable option for Discoms.

Basic infrastructure in not ready: - Most of the utilities are struggling with basic
infrastructure deployment for metering, billing and load monitoring. This infrastructure will
become the backbone for DR Program.

Consumers paying cross subsidy have more potential :- The consumers who can
participate easily in DR and also provide decent response are basically the industrial consumers
which are high paying consumers hence, reduction of demand from them and additional
payment of incentive does not seems viable for Utility.

Demand Forecasting: - For DR event to call, the utility need to forecast its demand in short
term, which is not the case for most of the utilities. In India, most of the utilities does not have
any full proof Demand forecasting tool through which they can forecast the demand in short
term and hence could call the DR Event.

Solutions:-
Infrastructure Development: - Infrastructure development is going on through various
schemes in India i.e. NSGM, R-APRDP, IPDS and UDAY. Although the infrastructure is not the
only constraint as far as DR in India is concerned but it also plays a very vital role for DR to
smoothly and successfully implement. For Example:- Electric Vehicle is a component of Smart
Grid and it can play a important role in DR through the capability of V2G( vehicle to grid i.e.
discharging) and G2V (grid to vehicle i.e. charging).

Demand Forecasting: - Demand forecasting is also a important factor for Demand Response,
it also helps to manage the variation of wind resources through DR if short term demand
forecasted accurately.

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 Integration of other resources: - Integration of other resources like Energy storage will
also be help full in DR due to their ability to work as on site generation as and when required.

DR Enabled devices:- For residential consumers to participate in Demand Response

program, the DR Enabled devices will play a crucial role and help in moving a step ahead toward
the automated DR. Few companies like LG, Panasonic are coming up with the DR enabled
devices like refrigerators.

Load Management System:- Remote load management system for industrial consumers
already deployed in few industries. This will also help control the load by desired amount by
industrial consumers without loosing much of the production cost. Industrial consumers can
also go for load shifting to other hours if it has the cushion for the same.

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