Long stretches of hot summer days or extremely cold winter weather sometimes force electric utilities to buy additional power when it costs the most or bring older, less efficient power plants online to meet demand they couldn't otherwise fulfill. Either way, it's expensive for the utility—and for its customers. Energy efficiency programs work well in reducing energy use under normal circumstances, but they weren't designed to quickly manage power supplies for periods of extremely high demand.
That's where demand response (DR) comes in. Basically it's an agreement where consumers agree to temporarily reduce the amount of energy they use in return for a rate reduction or other financial incentive. Our story below offers an example of how a subsidiary of Council Global Lead Partner Enel is helping a commercial real estate company increase its bottom line while at the same time helping the local electric utility manage its grid. If it's an option your city hasn't yet considered, now would be a good time. The hot summer months are coming soon. — Doug Peeples
Demand for energy is expected to increase 40% by 2030. While clean, green renewable energy is expected to meet much of that growing demand, energy management programs will be essential to help manage electric grid growth and stability and maintain reasonable power prices for consumers.
New York City's Glenwood Management is one of the city's largest owners, managers and developers of luxury residential rental properties. It also has a reputation for sustainability based on its 6.3 MWh of battery storage and 2 MW of solar + storage installed across its real estate holdings.
Now the company is taking it one step further. Earlier this month Glenwood signed on with Enel's advanced energy services division Enel X to provide DR services for many of Glenwood's buildings through U.S. subsidiary EnerNOC. The companies have a history of working together because EnerNOC has worked with the company since its first battery storage system was installed in 2012 and more systems will be installed this year.
"We are expanding our partnership with Enel X by adding demand response to the portfolio of solutikons that we are leveraging to reduce our energy costs, improve the resiliency of our buildings for our tenants, and support the stability of the power grid," said Josh London, management VP for Glenwood. As a member of local utility Con Ed's Smart Usage Rewards program, will receive financial incentives in return for temporarily cutting energy use during peak summer hours and contributing to grid reliability.
Cities, schools and others can take advantage of DR, too…
DR isn't new. Large energy users like manufacturing plants, data centers and commercial real estate companies have been using it in various forms for several years. But it's not limited to big companies. EnerNOC and other DR service companies work directly with electric companies, cities and others. Here are a few examples:
Knox County Schools in Knoxville, Tennessee is a Tennessee Valley Authority electric customer. Before joining the TVA-EnerNOC Demand Response program the district was struggling with increasing energy costs, which were second only behind personnel costs. As Knox County Schools Energy Manager Zane Foraker explained, "Energy was the largest expense after personnel and we were facing unsustainable cost increases." During the time the district has been participating in the program it has earned about $70,000 annually, money that can be used to support other school programs.
Southern California's Eastern Municipal Water District serves a population of more than 630,000 and pays more than $10 million in energy costs to do it. As a participant in EnerNOC's DR program it now receives about $100,000 annually for voluntarily reducing its electricity use. Because the utility has several sources of water and stored water, short-term outages have little effect on its operations.
Doug Peeples is a Portland, Oregon-based writer specializing in technology and energy. Follow @smartccouncil on Twitter.