Flexible futures: The potential for electrical energy demand response in New Zealand

Abstract

Demand response (DR) is the shifting of electricity demand to align with generation or other constraints, which can extend the lifetime of network components and increase the use of renewable energy. DR implementation depends on technical, economic, and behavioural factors, alongside country-specific factors. In this work, the existing and emerging DR potential in New Zealand is calculated, based on technological capacities. New Zealand is shown to have abundant DR potential, equivalent to 69% of national electrical energy demand, which can be harnessed through retrofitting and incentivisation. The residential, commercial, industrial, and agricultural sectors each offer considerable DR potential, with water heating, refrigeration systems, and electric motors key candidates. Electric vehicles and the electrification of industrial process heat in line with New Zealand's decarbonisation goals will offer additional DR potential, equivalent to 23% of existing electricity demand. Specific policy recommendations are provided, including the incorporation of controllability into emerging electrification projects to facilitate their use for DR. These findings suggest DR can be a solution for electricity load management in New Zealand and other countries, and provide a framework for policy makers, network operators, and electricity companies to target DR implementation, enhancing energy system resilience and sustainability.