Global Demand Response Management Systems (DRMS) Market Outlook to 2028

Drivers:

• Supporting government funding, policies, utility programs, corporate goals
• Customer incentives by the utilities
• Rising number of Distributed Energy Resources (DER) making it easier to join the DR programs
• Emerging Smart Grid technology and transformation
• Increasing adoption of smart meters
• Growing adoption of demand response management system (DRMS) due to its benefits to utilities and customers

Definition and Benefits:

Before the concept of energy storage, utilities have historically balanced demand and supply by limiting power plant output, turning generating units on or off, or importing power from other utilities.

But practically, these solutions are expensive and time-consuming on the supply side as certain generating units take a long time to reach full power. In addition, some units are expensive to operate, and demand can sometimes exceed the capacity of all existing power plants combined.

The grid becomes unstable if there is not enough power supply to meet the demand for electricity from all customers damaging essential equipment within the grid, risking larger numbers of customers being without power for longer periods if load shedding were not used. Therefore, load shedding is used as a last resort measure to balance the demand and supply of electricity across the electricity market.

Demand response allows the modification of the power demand rather than the supply. Demand response (DR) is defined as deviations from standard consumption patterns by demand-side resources when the power grid is near its capacity limits. DR typically involves paying some energy consumers to voluntarily or involuntarily cut or shift their use of power to better match supply.

Utilities can transmit demand requests to their customers in various methods, including simple off-peak metering, in which power is cheaper at specific times of the day, and smart metering, in which customers can make explicit requests or receive pricing changes.

The consumer can adjust their power demand by deferring some actions that need a lot of electricity or using alternative energy resources such as solar panels and batteries on-site.

Benefits:

• Fewer power outages
• It helps reduce energy consumption and electricity bills
• It helps utilities for peak load management
• These programs can lower the cost of electricity in wholesale markets, leading to lower retail rates.
• Decrease in energy load across many participating businesses provides significant grid reliability services, reducing stress and stabilizing cost
• Gives consumers the ability to see wholesale prices and react when prices are high. This helps minimize the impact of price spikes, reduce the need for expensive peaking generating capacity and help hold down energy prices overall
• Demand response solutions eliminate the need for new, expensive power units by lowering peak energy demand
• For customers- Utility bill savings, easier programme participation, more resource and service alternatives, and better customer satisfaction
• For grid operators and utilities - reduced system costs, greater dependability, and optimal grid performance

Emerging Smart Grid transformation.

• Traditional power grids are undergoing significant changes due to the need to integrate renewable energy, enhance the energy efficiency, and provide customers more control over their energy usage
• The smart grid will integrate established power technology with advanced analytics, smart devices, and automation technologies to support the two-way interchange of energy and information. As a result, a smart grid can respond to consumer electrical demand and any potential incidents. Demand Response (DR) is a key attribute to enhance the operation of smart grid
• Covid-19 has impacted the global electricity networks investments in 2020 compared to the previous year with USD 270 billion. However, they have been on rise in 2021 reaching ~USD 290 billion with some large investments in China and Europe

Some Global Policies and Schemes towards Smart Grids:

• India, 2021- Revamped Distribution Sector Scheme
• Canada, 2021 - Smart Renewables and Electrification Pathways Program
• The United Kingdom, 2021 - Smart technologies and data to future proof UK energy
• Spain, 2021 - Recovery, transformation, and resilience plan / Inclusive and fair energy transition
• Italy, 2021 - National Recovery and Resilience Plan / M2C2: Renewable energy, hydrogen, grid, and sustainable mobility
• Hungary, 2021 - Recovery and adaptation plan / Energy / Network Development

Restraints:

• Effects of the COVID-19 (change in load patterns affecting the availability of demand response resources)
• Due to perceived cybersecurity risk, customers are hesitant to install hardware or integrate SCADA
• Customer awareness
• For many smaller sites, the cost of hardware and installation is unaffordable
• Retrofitting existing meter connections with smart technology
• Concerns for the appliance/electronics longevity that are cycled on/off by demand response programs

Recent Trends & Developments:

• In Sep 2021, Sunnova Energy International Inc. partnered with AutoGrid to provide reliable demand response resources to Clean Power Alliance’s (CPA) Power Response Program.
• In Sep 2021, Johnson Controls and Apollo Infrastructure announced a strategic partnership to pursue innovative sustainability and energy efficiency services for commercial buildings
• In Oct 2021, AutoGrid Announced $85M in Funding to Accelerate Deployment of Virtual Power Plants towards energy transition through adoption of electric vehicles, battery storage and renewables generation.

Regional Analysis:

North America: United States

• Globally and among the North American regions, the United States is leading the demand response management system market. One of the main drivers is the intensive rollout of smart electric meters and advanced metering infrastructure (AMI). In addition, advanced metering infrastructure expands the range of time-based rate programs offered to consumers
• Along with the generation and transmission infrastructure, the United States electric grid is a complex ecosystem of asset owners, manufacturers, service providers, and federal, state, and local government officials working together to operate one of the world's most reliable power grids
• The Office of Electricity (OE) is joining forces with public and private sector partners to intensify, modify, and enhance energy infrastructure to ensure access to reliable, secure, and environmentally friendly energy sources
• By the end of 2020, 732,818 thousand customers were enrolled in the demand response program which was 38 % less compared to previous year which had 1.1 million customers enrolled
• On November 15, 2021, President Biden signed the Infrastructure Investment and Jobs Act (the Act), which includes amendments to existing energy laws and investments in energy infrastructure, including demand response resources and advanced metering
• The Act amends the Federal Energy Management Program to encourage the adoption of demand response technologies and practices in federal facilities
• In addition, as part of the Components of Zero-Net-Energy Commercial Buildings Initiative, the Act amends the Energy Independence and Security Act of 2007 to incorporate demand response technologies, practices, and policies

Total Number of Customers Enrolled in DR Program by Sector (in million) from 2013 - 2020

Demand Response Program Cost (in USD million) from 2013 - 2020

Opportunities:

• Advance Metering Infrastructure (AMI) rollouts - The United States., Sweden, Italy, France, Netherlands, Japan, the United Kingdom, New Zealand

The publisher's Demand Response Management System market report provides insights into the current global and regional Global market demand scenario and its outlook.

This study offers a detailed analysis of various factors instrumental in affecting the Demand Response Management System market's growth. The study also comprehensively analyses the market based on geography (North America, Europe, Asia-Pacific, and the Rest of the world).

This report also includes the latest market trends, drivers and restraints, present and future opportunities, new projects, the global impact of Covid-19 on the Demand Response Management System market, and significant developments.

Further, the report will also provide DRMS market size, demand forecast, and key competitors in the market.


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