They let small consumers form a Virtual Power Plant which can regulate demand downwards and thus make offers on the spot market: “We hope to show that even these small customers can help balance the grid, based on actual need within the hour,”

"Through the four-year, €21 million (US $28 million) EcoGrid project, about 2000 households there will be connected to an island-spanning network that will enable homeowners to cut back their electricity usage at times of peak demand and sell that unused wattage back to the grid at market rates."

I wonder if no-one considers the game-theoretic strategy of turning things on before an expected price peak, so that turning it off leads to un-deserved profits. In effect, a Virtual Power Plant is colluding to drive up prices on the spot market. We are on the track to involve more and more capacity in real-time markets and we have to be wary of speculative effects during peaks, also from small players who aggregate.

I believe some ahead-planning (e.g. bidding to reserve electricity, which has to be paid in full if not used for balancing) would lead to a solution with less speculations, even if it requires better planning software within the homes.

13 Jul 2012 - 7:33
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