Ukrainians to be paid for shifting electricity consumption away from peak hours

Cash compensation for changing electricity usage schedules

Ukrainian consumers will be able to receive compensation for shifting their electricity consumption from peak hours to periods when the load on the power grid is lower. This mechanism is provided for in a draft amendment to the Rules of the Retail Electricity Market, which was approved by the NRECU.

The essence of the demand-side management mechanism

This refers to so-called demand-side management. Consumers will voluntarily change the time or volume of their electricity use in accordance with the terms of a contract, and in return, they will be able to receive compensation.

For example, an enterprise could shift part of its production processes to hours of lower load. Households could change the operating times of specific electrical appliances.

The role of aggregators and contractual relations

Aggregators will act as intermediaries between consumers and the energy market. They will combine the capabilities of many users and help manage electricity consumption.

At the same time, there is no need to change one’s electricity supplier.

The consumer will have two separate contracts:

• with the electricity supplier — for the supply of electricity;
• with the aggregator — for participation in demand-side management and receipt of compensation.

The amount and terms of payments will depend on the contract with the aggregator and the actual change in the schedule or volumes of consumption.

Impact on the power grid

For the power grid, this mechanism is intended to help reduce load during peak hours, use existing capacities more efficiently, and maintain the balance between electricity generation and consumption.

The draft resolution also defines the rules for aggregators’ work with consumers, the terms for concluding contracts, settlements, and information provision.