This Annex builds on the work of IEA EBC Annexes 67, 81 and 82.  It will provide building owners and energy market participants with a framework of concepts, procedures, tools and evidence - that can enable trustworthy, automated, cost-effective trading of flexibility resources from buildings; at scale. 

The Annex will consider the technologies available for delivering flexibility from heating and cooling systems in individual buildings – with a focus on supporting adoption of simple, repeatability scalable solutions. The Annex will also consider the digital infrastructure necessary for coordinating and automating dispatch of large numbers of flexible load resources, in local and national energy markets/schemes. The Annex will also consider the ability of flexible energy resources to reduce carbon emissions, based on time-of-use grid carbon intensity.

The Annex will deliver a number of important outputs for a range of audiences. Energy infrastructure planners and government policy makers will be provided with information management concepts and platform design frameworks, to help coordinate flexibility in energy systems that have high levels of variable renewable energy resources. Building owners will be provided with independent guidelines, case studies and other knowledge sharing resources to help simplify and de-risk implementation. Flexibility product suppliers will be provided with performance metrics and independent guidelines that can help to increase trust in their products. The annex will actively disseminate findings, and engage with research and industry audiences, by publishing reports, convening webinars and through an online case-studies web portal.

Background and Justification

Background

At COP28, jurisdictions committed to double the global average annual rate of energy efficiency improvements. The IEA identifies ‘Leveraging digital innovation to enhance system-wide efficiency’ as one of its ten strategic principles for achieving this[1].

In addition to improving energy efficiency (reducing overall consumption), ‘system-wide efficiency’ includes the emerging need for load shifting (managing the time of energy consumption)[2].  This is required to improve the security of energy systems, as part of the transition to variable renewable energy resources.  In their Net Zero Emissions by 2050 Scenario, the IEA[3] is calling for a tenfold increase in demand response availability from buildings between 2020 and 2030.

In one jurisdictional example, the Australian Electricity Market Operator’s 2022 Integrated System Plan[4] modelled future requirements for flexibility in the Australian National Electricity Market.  AEMO found that, by 2050, “distributed storage including coordinated VPPs is forecast to represent almost three-quarters of dispatchable capacity (in MW terms)”.   

In addition to energy security benefits, flexibility enables buildings to reduce emissions by consuming energy when the instantaneous grid carbon intensity is lower.  ‘Time stamped’ carbon emissions accounting, will become progressively more important (compared with carbon accounting using average annual emissions factors) as the energy system transitions to variable renewable energy sources.  

Opportunities for sourcing demand response from ‘flexible demand assets’ in (or associated with) buildings include:

• Managing the diurnal operation of heating and cooling equipment to source either (i) active thermal storage (eg chilled or hot water) or (ii) passive thermal storage from the building fabric.
• Managing production and storage of domestic hot water.
• Managing the time of charge and discharge of electric batteries.
• Managing the time for charging electric vehicles.
• Calling on standby generators to reduce demand on the grid.

Some of these sources of flexibility are established (eg hot water, standby generators). Others are emerging (eg electric vehicles, electric batteries). Despite heating and cooling representing over 50% of peak demand, in many energy systems, the flexibility available from thermal storage associated with these loads is relatively underutilised.

IEA EBC Annex 67 “Energy Flexible Buildings” investigated the energy flexibility potential of heating and cooling systems in different building types.  They investigated both (i) the fit of demand profiles with the availability of various variable renewable energy resources, and (ii) the potential for heating and cooling control strategies to improve that fit; for individual buildings.  IEA EBC Annex 82 “Energy Flexible Buildings Towards Resilient Low Carbon Energy Systems” is extending this work, with a focus on clusters of buildings.  This includes simulating the potential impact of orchestrating demand by broadcasting penalty signals to flexible heating and cooling assets.    

Digitalisation is seen as one of the key tools for unlocking heating and cooling demand response resources.  Indeed, without the enabling connectivity and information exchange capability (provided by digitalisation), it would be impossible to achieve near real time coordination of large numbers of distributed energy assets.

IEA EBC Annex 81 “Data-Driven Smart Buildings” investigated the digital infrastructure and data management considerations that underpin scalable deployment of energy productivity software services in buildings.  They also investigated the potential for various emerging data-driven AI tools to automate traditional energy efficiency and flexibility applications. They produced a policy roadmap for accelerating adoption of digitalisation, with particular focus on enabling flexibility services.

Consistent with IEA recommendations, this new Annex aims to combine the learnings of Annex 81 and Annex 82 to unlock the availability of flexible loads, from heating and cooling resources in buildings. This is expected to be achieved by focussing on (i) the digitalisation framework necessary for automating asset dispatch and resource quantification, and (ii) by improving the TRL/CRL of flexible heating and cooling products and services.        

Key research questions that this Annex will address include:

• What heating and cooling flexibility products and services are the most widely useable, predictable and cost-effective (achieve a target cost of <$200/kVA)?
• How can energy flexibility be characterised and communicated, in operational settings, to continuously inform markets of the forecast availability of heating and cooling systems to be able to provide demand flexibility services? How can this be automated and certified?
• How can flexibility resources be managed (in aggregate) to both improve the certainty that outcomes will be delivered, and avoid rebound effects when flexible resources return to service?
• What measurement and verification methodologies and algorithms can account for uncertainty, to fairly and cost-effectively determine delivered flexibility after a demand response event?      
• Can semantic web technologies enhance ‘machine-readability’ in a way that can automate flexibility services in buildings and/or energy trading processes, and support innovative business models?  
• How can data-driven approaches be used (i) to reduce the various technical and commercial barriers to sourcing flexibility services from buildings, and (ii) to package flexibility resources in a way that is attractive in various energy markets and regulatory environments?

Justification

The Annex has evolved from expert discussions under the auspices of the Mission Innovation (MI) ‘Affordable Heating and Cooling’ Innovation Community, and through combined meetings of experts from IEA EBC Annexes 81 and 82. 

The Annex responds to Objectives Theme#5 ‘Holistic Solution Sets on a District Level’ and Theme#3 ‘Low-Tech, Robust and Affordable Technology’ in the 2019-2024 EBC Strategic Plan.   The theory-of-change for scaling adoption of demand response services follows the Means Theme#2 ‘Living labs to provide experience and barriers of adoption of energy efficiency measures’, Theme#3 ‘Smart control of building services technical installations, including occupant and operator interfaces’, and Theme#4 ‘Data issues in buildings, non-intrusive and secure data collection’.     

The Annex will conduct research on a number of the identified EBC strategic topics, including:

• Design and utilisation of data platforms (for orchestrating clusters of flexible demand assets, and providing information to markets and industry decision makers).
• Use of smart controls to ensure robust provision of flexibility services, while simplifying participation in markets for building owners.
• Linking the operational performance of individual buildings to community systems and related infrastructure.
• Use of living labs to examine robustness, occupant comfort and satisfaction with flexibility products and services.
• Use of AI to (i) reduce the cost of deploying data management systems and (ii) improve the aggregate load profiles of fleets of flexible demand assets.   

2. Objectives and Scope

Annex Vision

The vision of the proposed Annex is to provide building owners and energy market participants with a framework of concepts, procedures, tools and evidence - that can enable trustworthy, automated, cost-effective trading of flexibility resources from buildings at scale. 

Annex Scope

The focus of the proposed Annex is on unlocking flexibility from heating and cooling systems in both residential and commercial buildings.

The scope relating to ‘concepts, procedures and tools for unlocking flexibility’ relate to

• The automation, controls and digitalisation infrastructure required, in buildings, to enable heating, cooling and metering equipment to (i) receive information (eg price signals or load shift requests) from external markets, (ii) optimise energy consumption in response to the information and (iii) advise external markets of the outcomes of demand response actions.
• The standard information and data structures, that need to be exchanged between actors in energy markets, to enable trustworthy trading of flexibility resources from buildings, and to drive relevant business models.

Annex scope also includes:

• Reporting on real world buildings and communities that are demonstrating flexibility services. 
• Development and stress testing of flexibility scenarios and flexibility resource orchestration algorithms in virtual digital twin benchmarking environments.
• Investigating the impact of shifting to time of use carbon accounting, and the potential of this to encourage adoption of flexibility in buildings.      

 Annex Objectives

The Annex objectives are to

• Advance the TRL/CRL of flexible load technologies available in buildings, 
• Develop the digital framework(s) for exposing flexible load resources to energy markets/schemes,
• Demonstrate the potential for automating flexibility aggregation and orchestration processes through modern digitalisation technologies,
• Assess the potential to use flexible loads to reduce emissions in building, by better matching demand with grid time-of-use emissions, and

• Drive adoption of Annex results through case studies, business model innovation and results dissemination.