As more households and businesses install rooftop solar and begin tracking their energy production, an increasing number of solar hosts are diving into a variety demand response opportunities —some at the behest of the utilities — to reduce their electricity bills.
Whether the demand response activities involve air conditioning use or EV charging management, the potential is now enormous for customer management of how and when to use electricity. Over 58 gigawatts of solar capacity is already installed in the country, enough to power more than 11 million homes, according to the Solar Energy Industries Association (SEIA).
A new study by the Smart Electric Power Alliance (SEPA), Navigant, and Peak Load Management Alliance (PLMA) shows that a new record of 18.3 gigawatts of electricity use was avoided, deferred, or otherwise managed through demand response activities last year, involving 155 utilities across the country. The study, “The 2018 Utility Demand Response Market Snapshot,” captured demand response among a respondent universe of close to 90 million customers.
“This new or renewed focus on electricity demand, commercialization and deployment of new sensing and control technologies, and new insights from the wealth of consumer and operational data is bridging gaps between grid operations and consumers in exciting ways,” says Tanuj Deora, the chief strategy officer at SEPA.
While only 6% of the utility respondents indicated that they currently use solar or energy storage in conjunction with demand response, nearly 54% of the respondents indicated an interest in more actively pairing demand response with solar or energy storage systems. this suggests that the number of households that will become involved in demand response will mushroom over the near future.
Air Conditioner Switching
Air conditioning management represented the greatest functional use of demand response during 2017, with a cumulative energy avoidance, if not savings, of 3.4 GW last year, the report indicates. Air conditioner switch programs allow a grid operator to shed air conditioning load by using a control switch that can remotely interrupt or cycle AC compressors.
The use of smart thermostats to help manage heating and cooling more efficiently is one key way that demand response is being integrated into US households, and in businesses and industry. The cumulative impact of smart thermostat control during 2017 amounted to 1.2 GW of energy savings, according to the study. Much of the progress is being driven by utility programs that encourage customer participation.
For example, Baltimore Gas & Electric launched its PeakRewards Smart Thermostat program in 2017, in which customers in the direct install program get a free thermostat installed in their homes. Participating customers can receive a bill credit of between $50 and $200 for AC control from June through September, and customers can choose their participation level from 50%, to 75%, or 100%. The program has enrolled 11,200 customers, representing 14,000 thermostats, and delivering 21 MW of demand reduction, BG&E reports.
The potential for energy savings on any given day also was demonstrated decisively last year. During the solar eclipse on Aug. 21, 2017, many grid operators feared that solar energy production would be reduced, by as much as 9 GW, the report says. Leading up to the eclipse, smart thermostat maker Nest launched a wide- reaching marketing campaign to recruit hundreds of thousands of its customers in an initiative to reduce their cooling energy use during the eclipse by opting into a special Rush Hour Rewards event with one click on their Nest thermostat. As a result, 700 MW of energy was saved across the country, the report says.
Automated Demand Response
Smart home energy management systems are making a major dent in appliance energy use, automatically controlling when washing machines go on, how much air conditioning is used during the day when no one is home, and when EV charging is done to take advantage of the lowest rates of electricity over a 24-hour period.
Automated systems, now a common offering at big box stores, cumulatively contributed to 3.7 GW of demand response management of electricity last year, the study shows.
Water heater management showed a breakout energy management total of 300 megawatts last year, the study notes. Water heater programs restrict customers’ electric water heaters from running for a set time during the day. Water heater programs may also incorporate other demand response strategies, such as storing hot water by shifting the electricity load from on-peak to off-peak periods, when the cost of electricity can range widely.
Business Deferred Usage
Not surprisingly, businesses involved in demand response curtailed a total of 7.2 GW of electricity last year, managing their production timing, process planning, lighting, heating and air conditioning controls, and pump usages the report indicates. This represented about two-thirds of all US demand response activity, with residential activity representing one-third.