Using Temperature Sensitivity to Estimate Shiftable Electricity Demand: Implications for power system investments and climate change

Abstract: Growth of intermittent renewable energy and climate change make it increasingly difficult to manage electricity demand variability. Centralized storage can help but is costly. An alternative is to shift demand. Cooling and heating demands are substantial and can be economically shifted using thermal storage. To estimate what thermal storage, employed at scale, might do to reshape electricity loads, we pair fine-scale weather data with hourly electricity use to estimate the share of temperature-sensitive demand across 31 regions that span the continental United States. We then show how much variability can be reduced by shifting temperature-sensitive loads, with and without improved transmission between regions. We find that approximately three quarters of within-day, within-region demand variability can be eliminated by shifting just half of temperature-sensitive demand. The variability-reducing benefits of shifting temperature-sensitive demand complement those gained from improved interregional transmission, and greatly mitigate the challenge of serving higher peaks under climate change.