Readiness of demand response technology for Spanish Energy Communities

Demand response (DR) and Energy Communities are highlighted as two key means to facilitate the energy transition in Europe by providing flexibility to the grid in a decentralized way. This paper uses a theoretical framework, the balanced readiness level assessment, to review five social and techno-economic dimensions regarding the status of demand response technology, emphasizing key challenges and opportunities. Focusing specifically on Energy Communities in Spain, issues such as the split-incentive problem in technology investments, market rules favouring large generators, and the imperative for improved coordination in the electricity market and network operations are identified as significant hurdles to further DR development. A balanced readiness level score of 7.25 is assessed for Spanish energy communities, composed of a 9 for the technological, a 7 for the regulatory and the acceptance, and a 5 for explicit and 7 for implicit market readiness level. The application of the balanced readiness level assessment methodology is novel to the energy industry and does not only prove the value it can create in this sector, but also provides insights for policymakers and stakeholders navigating the dynamic landscape of Demand Response for Spanish Energy Communities.