Assessment of advanced demand response value streams for water heaters in renewable-rich electricity markets

Water heating is a significant domestic load, representing ∼25% of total household energy consumption in developed countries. This study considers domestic electric storage water heaters as both thermal storage and controllable loads that respond to electrical network conditions in real-time, participating in demand response (DR) schemes. The studied electrical market leads the world in PV generation at 960 W/capita, and is demonstrating increasingly volatile energy prices and supply quality due to a lack of energy storage and DR. Existing literature in water heater demand management, considers oversimplified water heating models, a tendency to lack real-time financial modelling, and omits a combination of network frequency and DR considerations. This research has proposed a framework of advanced DR value streams for water heaters, leading to advanced water heater design and controls that critically determine the urgency of heating, and intelligently vary the location of thermal energy injection to minimise heat losses and emergency/sanitation heating. The results have demonstrated significant annual financial savings from 113% to 217% with DR representing up to 92% of annual energy consumption. At a national level, a new demand management load of 10.8 GW and 5.94 TWh/annum is identified, representing 2% of Australia's annual electricity consumption. [Display omitted] •Advanced demand management of domestic hot water heaters.•Grid energy storage priority based on real-time price and state of charge.•Quantification of frequency reserve potential in electric storage water heaters.•Converting energy expense to income using electric storage water heaters.