One of the most effective and widely available ways to reduce electricity costs and consumption is participation in demand response programs; however, a large gap exists between interest levels and actual participation in such programs.
Demand response provides financial incentives for voluntarily reducing electricity usage during peak demand times when electricity prices are highest. A new report by the Energy Research Council (ERC), Best Practices: Demand Response, validates that 29 per cent of midsize companies are very interested in demand response participation, but only 9 per cent currently take advantage of demand response programs.
Peak demand occurs only a few times per year, mostly during afternoon hours in the summer. Business owners can reduce consumption during peak times by shutting down equipment, alternating production schedules, operating onsite generators, or adjusting lighting and HVAC settings.
Demand response participation
Several reasons explain the gap between interest levels and actual participation in demand response. A 2012 ERC survey of midsize businesses verifies that a significant barrier to demand response participation is lack of awareness and education. Only 20 per cent of survey respondents said they were very or mostly familiar with demand response. The majority reported they were only somewhat familiar (34 per cent) or not at all familiar (46 per cent) with demand response services.
Comprised of millions of individual meters and thousands of local networks, the U.S. electricity infrastructure is expensive, challenging to maintain, and rapidly aging. Trillions of dollars must be invested nationally in the next few decades to upgrade from the current infrastructure to a modernised, fully interactive Smart Grid. As utilities are required to rebuild transmission systems to ensure reliable delivery of electricity to homes and businesses, consumers will see electricity delivery costs rise to cover necessary expenditures.
Looking forward, Smart Grid technology will greatly improve demand response and its ability to better manage electricity costs. Smart Grids can automatically control electricity flow, and can identify, isolate, and resolve load problems. For a Smart Grid to be truly effective, it must interface with smart buildings and smart equipment. Connected to a Smart Grid, smart buildings can respond to peak demand events and real-time electricity pricing.
Reducing electricity usage during peak demand times is important because more Opeaker plantsO must go online to generate enough power to meet peak load. Peaker plants are old, dirty, and expensive to operate. Demand Response programs are becoming an increasingly important resource for grid operators during periods of system stress to help prevent blackouts, reduce demand on the grid, and benefit the environment.
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04 September 2017
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