According to FERC’s most recent "Demand Response and Advanced Metering Assessment," 74 percent of the potential peak reduction in retail demand-management programs comes from C&I customers. That means that the biggest, most valuable energy customers are also the most likely allies in a demand response initiative.
So, is it better to take a traditional demand response (DR) approach with these customers, which treats every customer the same and is often disruptive to their businesses on the hottest days of the year? Or does it make more sense to enlist them as a partner in grid support through a customer-centric, non-disruptive demand-reduction approach?
Here are a few reasons why it is important to take the time to understand a utility customer’s business up-front and how non-disruptive demand response can best fit into their operations,
Want some impact with that DR program?
First, let’s clarify the difference between disruptive and non-disruptive demand management. Disruptive programs are the ones where companies agree to curtail load - often just a few times each year - but they have no say-so on when or how that curtailment will happen. In exchange for some kind of energy-bill savings, the company will shed a specified amount of load when requested by the utility or grid operator.
Granted, the power provider usually gives day-ahead or at least 12-hour notice of the upcoming load-shedding event, although in some cases, the notifications are just 10 to 15 minutes in advance. Regardless, it’s still up to the C&I customer to deal with a little less office comfort or a shift in work scheduling when that DR event gets called.
Note that programs like this frequently require a critical element that non-disruptive DR programs generally don’t have: human intervention. Often, these DR programs start with a phone call from the power provider to an operations manager at the customer site. From there, production teams may shift work; building managers might adjust temperature controls and lighting; grocers might wind up shutting down the antisweat heaters that keep freezer cases from fogging up - there’s a wide range of actions people can and must take to meet their obligation to the utility, ISO or energy service provider.
On the other hand, with non-disruptive DR tied to a distributed energy resource management system (DERMS), power providers can work closely with customers up-front to model a DR approach that is best for customer business operations and then automate that approach so that so that customers do not have to take any actions at all.
Easy savings on auto-pilot
Constraint-based, non-disruptive demand management reflects a collaboration with the customer rather than a deal that says, “You shut that off, and I’ll pay you this.”
Non-disruptive demand management begins with a detailed inventory of all the devices that could be connected to a DERMS, along with the electricity they consume and when they consume it. This involves examining process data from the building management system (BMS) or the programmable logic controller (PLC) that records electricity consumption of the site’s equipment. Both current and historic BMS or PLC data should be considered so that the program operators understand both overall and seasonal consumption patterns.
This information makes it possible to identify which devices can be used for load control, storage retrieval or on-premises generation. For example, a school in Eastern Canada that is connected to the Enbala platform has seven air handlers and 350 duct heaters under control, as well as 262 other devices. Some of those smaller devices, such as baseboard heaters, are rated for as little as one kilowatt in capacity. Still, taken collectively, those devices can be presented to a utility or grid operator as a single, significant dispatchable resource.
How? By adding even small resources to a network and drawing on Metcalfe’s law (which states that the value of a network corresponds to the square of the number of nodes within the network itself), even small resources can be used in a DR program. The more assets or nodes connected to the network, the greater the ability to mix and match devices and owner-specified constraints in a way that creates precisely the level of capacity that a utility or grid operator requires.
For customers, the network effect delivers more opportunity. All-or-nothing demand response programs mandate a certain number of hours during which customers must participate. Through constraint-based programs that aggregate many assets to create the required response, customers can have their assets bid into markets in fractions of hours, which means they usually can participate even more than they would under a traditional DR program. Most do.
Best yet, the right distributed energy resource management platform can leverage the flexibility of behind-the-meter load, solar and storage assets with no discernable interruption to industrial processes or HVAC comfort controls at a facility. This is because participation is programmed to happen in accordance to predefined customer constraints. As customer constraints and needs change, so can the constraints used to determine device set points. That flexibility makes it easier for C&I customers to stick with the program, which lowers the churn and cost for the utility or grid operator running it. It's a win win approach.
Want to know more? Here is a white paper that might interest you.