How to Respond
There are
several ways to adjust energy usage in order to
cooperate with a demand response program. Some
examples are:
- A manufacturer rescheduling
a shift to off-peak hours.
- Switching off
non-essential equipment.
- Using onsite
backup generation to replace the power normally
supplied by the utility company.
There are
practical and sometimes legal restrictions on
demand response participants. For example a
hospital must meet "human needs" and maintain a
redundant source of supply.
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Your
Energy Manager
Topic:
Demand Response
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Welcome, 
Independent
Energy Consultants, Inc. is committed to helping
its clients make well-informed
and cost-effective decisions regarding
their energy supply and consumption. We are
sending you this newsletter to help you understand
how decisions made, or not made, affect your
company's bottom line.
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Demand
Response
Demand
response programs are available in many areas of
the country and provide a means for energy users
to earn revenue by curtailing some or all of their
electric load during times when the local grid is
flowing at maximum capacity. Demand response also
allows the utility companies to defray building
new power plants if enough customers are prepared
to reduce load when needed. Demand
response relies on those who can quickly reduce
their energy usage to ensure that the entirety of
the grid can have uninterrupted power.
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Curtailment
Service Provider
In
order to participate in a demand response program
a customer must retain a certified Curtailment
Service Provider (CSP) to coordinate activities
with the grid operators. A CSP will help a
client identify non-essential loads that can be
turned off or turned down for brief periods of
time when called upon. The CSP will also
provide advanced notice of when a curtailment
request is likely to be made. Following the
curtailment, the CSP works with the grid operator
to identify how much power was reduced by the
customer, what the prevailing rates for
electricity were during that time and how much of
a check they are owed.
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Program
Types
There are
different kinds of demand response programs and
all involve revenue paid to clients who can
control their energy consumption. However it is
important to choose the one that best fits your
energy needs and curtailment capabilities.
The two major categories are: 
Emergency Demand
Response - This is considered a mandatory
commitment to reduce or cap energy usage by an
agreed upon amount when the grid reports a supply
shortage or emergency conditions. Under this
arrangement the client agrees to answer when
called up or will be charged penalties for failing
to do so.
Economic Demand
Response - This is considered a voluntary
commitment to reduce load when wholesale electric
prices reach a certain level. At this point it is
more cost effective for the grid to call on demand
response clients and pay them for their service
than to turn on higher-priced power plants.
Participants in demand
response must be able to make a sufficient
reduction in their load (typically at least 300
kW) in order to earn revenue from the grid.
The best candidates are those who can shift the
time of their usage or those with backup or
co-generation (for example a combined heat and
power systems (CHP)). Those who are able to
participate in demand response programs provide a
great service by helping minimize outages and
maintaining the reliability of our energy grid.
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As a Certified CSP in the PJM
marketplace, Independent
Energy Consultants
is proud to offer demand response as yet another
way to help our clients save or earn money from
their energy consumption. If you would like
to participate in a demand response program in
2014 the deadline to do so is fast
approaching. Call us at 1-888-862-6060 to
learn more.
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