Go back forty years to the 1970's and coal was the dominant fuel used for electricity generation, nuclear power stations were beginning to come on line and there was a small amount of oil and hydro capacity. Many large power stations were sited close to the coal fields that supplied them. Visits to power stations were mandatory for engineering students and I went on two of these and at each one the importance of matching supply and demand was pointed out and illustrated with the same example, that of the Miss World Contest, at the end of this event, several million households all rushed to the kitchen to boil water in electric kettles with which to make tea, creating a massive spike in the demand for energy which had to be met from the "spinning reserve", maybe this was just a good story to amuse visitors, but it sounds credible. It probably would not amuse my wife and daughter, both of whom have feminist leanings and both of whom have travelled extensively to meet people, which seemed to by the principal aspiration of most Miss World contestants. To summarise, demand management appeared to be based on the weather, seasons and the TV schedules.
Move on forty years and electricity generation has become much more diverse with gas, wind and solar entering the mix. Wind is a discontinuous source, on a windy day, wind might account for 10 - 15% or more of the demand for electricity, on a calm day this can get close to zero. Looking at the supply of electricity, it appears that gas powered stations act as "back up" for the wind farms, this may not have been the role that investors in gas powered stations envisaged. In short, the management and economics of electricity generation appear to have become complex. Variations in strike price for different forms of generation and auctions to maintain capacity do not appear to contribute anything in the way of simplicity.
From the perspective of a naive observer it seems that we are doubling up on generating capacity because of the fickle wind and shifting sun, sustainable sources have to be backed up in some way. The critical technologies would seem to be demand management and storage both of which could ease the integration of sustainable energy sources and reduce the amount of doubling up.
The peak demand for electricity is during the day and early evening. The peak demand can either be met from bringing generating capacity on line, or reducing the demand. The internet of things can make a contribution to managing demand, the frequently quoted example is turning of the fridge in the early evening during evening when many families are cooking meals and doing things with electrical appliances. It's not beyond the imagination to imagine a system that prioritises the use of energy, turning some things off to free up resources and facilitating tasks that can't wait and then reconnecting them at a more convenient time for the electricity supplier.
There are many ways such a system could be configured. At one end of the continuum the system boundaries could be drawn at the household or office level, In this case the maximum load on the grid is defined and decisions about its use made by the people inhabiting the unit. At the other extreme, there could be centralised control.
My guess is that the technology is not the problem, instead it is making it acceptable to the energy consumers. A key element would be the design of the tariff which would make it attractive for users to stay within the maximum load restriction. Having discussed this with a few people, including one of my sons, the usual reaction is a lack of willingness to pass control of one's fridge to a third party. the "big ask" of this scheme is to forfeit autonomy for objectives which are remote from the average householder. These include investing in technology other than generating capacity and improving the management grid management. For this reason, I would suggest that politicians will be slow champion this concept.
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