Putting security of supply on the market

In power markets, the demand is relatively insensitive to short-term price fluctuations. At the same time it is well understood that short-term demand response is necessary in order to make the power market work efficiently on the investment side. Therefore, demand response is the most important tool in order to handle Security of Supply (SoS) in a market-based way. One possible way to achieve this is to let the consumers take responsibility in determining the level of SoS they want. The project will analyse technical, economic and responsibility issues of putting Security of Supply on the market. The method is a combination of literature study and a study of incentives and roles based on relevant blackout cases. Additionally, a catalogue of technologies and a model will be developed in order to calculate the socioeconomic benefit of utilising consumer resources efficiently. The project includes three main phases: 1. Literature study and conceptual definitions. 2. Calculating the socioeconomic value of demand response as a tool for SoS. 3. Roles and drivers in a power market where SoS is market-determined. The findings in this project will be used as input in the concurrent debate about development of the power market