Application of multilevel demand subscription pricing for mobilizing residential demand response in Belgium

The large-scale integration of renewable energy is progressing at an unprecedented pace. The highly variable, non-controllable and unpredictable variation of renewable energy supply requires fast-response generators for balancing, which results in increased operating costs and emissions. This ultimately undermines the economic and environmental benefits of renewable energy integration. These adverse effects can be mitigated by mobilizing the flexibility on the demand side. In this paper, we revisit a multilevel demand subscription pricing policy for electric power, in which a menu of service contracts for assigning different reliability combined with a non-linear energy price schedule is offered. The motivation of this paradigm is to provide differentiated products that can mobilize massive residential demand response resources while respecting the requirement of consumers for simplicity, privacy and control. In this paper, we apply multilevel demand subscription pricing on Belgium to design such a contract for residential consumers.