Implementing Demand Response and Energy Efficiency

I have been reading a bit about Demand Response and Energy Efficiency. Utilities  both public and investor owned are trying to implement joint programs for energy efficiency and demand response. Few pertinent questions come to my mind.

What does this sync up mean for the end users.. commercial and large industrial end users of electricity and what does this partnership provide the utilities?  What are the resources and services available in the market for businesses to analyze and implement such a program?

EE and DR are kinds of demand side energy management techniques. EE is permanent while DR is temporary based on time, season, price and load conditions on the grid. Utilities benefit from EE as they are able to reduce their base load. Energy efficiency is a kind of permanent demand side energy management slightly different from temporary load based demand response. Utilities need both kinds of demand side energy management . They embrace EE for long term load curtailment and DR for active load management.

As for the business customer of the utility, demand response until now was an option which the Facilities/Operations/ Management decided to participate in or opt out under various kinds of programs offered by the utility. However, the stage is being set for automated demand response (ADR), due to the communication upgrade by the utility in terms of smart meter and automated servers (the whole AMI infrastructure). If utility’s infrastructure becomes capable of sending price signals to the business customer  via smart meter/server in near real time, demand response gets a higher value and attention as a demand side management tool. This is because of real time based pricing instead of negotiated flat rate, DR has the capability to provide potential monetization for the customer.

The big question is are businesses ready for that kind of scenario. Based on my experience, very few commercial/ industrial customers have the tools, resources or management approval for DR, leave aside ADR. DR impacts business operations and reliability in most energy intensive enterprises. Hence it has always been an item with pending decision.

What are the resources available for large business customers to analyze and explore the combination of EE and DR. EE is being implemented in almost all companies where the ROI is less than one year. In addition where incentives and subsidies bring ROI to a palatable level such as solar, the projects get funded. Most utilities provide DR programs. If the in-house demand side management resources are tight and a company needs outside help in analyzing and managing DR there is help in the marketplace.

Based on my research I have found consulting and DR service providers who offer help in understanding all the variables in EE/DR/ADR . Some firms are pure consulting firms that help the companies understand the energy market holistically from supply and demand side and optimize an energy strategy for them, which includes EE/DR planning and implementation. Such as KEMA (http://www.kema.com/services/consulting/utility-future/smart-grid/demand-response-market.aspx), Navigant Consulting (http://www.navigantconsulting.com/industries/energy/energy_efficiency/) and many more. Typically you would also need in house resources for implementation. There are others that operate as pure DR providers. They are regional or national aggregators who work with end users, utilities and RTO/ISO’s to solve the problem of oversized demand. Companies such as CPower http://www.cpowered.com/about.php; EnerNOC http://www.enernoc.com/index.php; Ziphany http://www.ziphany.com/drp.html; Eisenbach Consulting http://www.eisenbachconsulting.com/demand-response.php .

Below are few details on offerings from different providers.

EnerNOC: offers both DR and EE. EE uses Monitoring based commissioning for uncovering savings. They monitor all the systems of the building after integrating the systems with their central control panel. Based on monitoring and analysis they offer EE opportunities.

Ziphany: offers mainly DR along-with meter data management platform. They do not provide integration service with building systems and equipment such as EnerNOC.

Eisenbach Consulting: offers mainly DR along-with energy procurement services.

CPower: offers both DR and EE. However, the target market for EE is Utilities and not business owners.

I am not advocating any provider over the other. I am sure there are more DR providers that provide load management solutions and consulting firms that can help companies analyze their business needs and align the energy strategy with the company’s goals. My aim to let the business managers, operation managers know that if DR is getting ignored due to other priorities they can seek help. The best way to address EE and DR is to define a comprehensive energy strategy for the company- both from the supply and demand side. If the supply side is the constant, then they can focus their resources on demand side management. Defining overall strategy should be the first goal and action plans & resource allocation should be developed later. This is crucial since in the future companies will have to factor in cost of carbon in their energy strategy from procurement to end use.

This article is not intended as a technical  resource but my attempt at defining the constraints, barriers for widespread adoption of demand response by end users. Hope you enjoy reading.

BOMA Silicon Valley Energy workshop

I recently attended an energy workshop, a lecture series, hosted at IBEW Union hall in San Jose, CA. I expected a good return on my invested money. And I actually did. The workshop had some very interesting and cutting edge topics on energy management.

1. EPA’s Energy Star Portfolio manager tool: The Speaker was a seasoned property manager (Cushman and Wakefield) who had worked on several high profile projects such as Adobe and Ebay. The presenter walked the audience through the basics of Portfolio Manager. (If my audience remembers-I had blogged about Portfolio Manager in my carbon footprint post!) I liked the walk through of the tool, what data to enter, key tips about data such as plug load( no of computers). They actually did a physical inventory of the computer by counting them to get the no of computers input.

Energy star Portfolio Manager score needs to be updated every month and the Energy Star Label is valid only for one year. There are some automation tools for entering the energy use data (time consuming otherwise). One is from PG&E and the other is through third party energy services providers who automate the data from your bills into formats that can be exported into the Portfolio Manager tool.

Another piece of knowledge I gained was about California Assembly Bill 1103. This Bill requires commercial property owners to disclose to lessee/lessor/ tenants Energy Star benchmarking data on or after 2010.

http://www.leginfo.ca.gov/pub/07-08/bill/asm/ab_1101-1150/ab_1103_bill_20071012_chaptered.pdf

2. Energy Audit by PG&E. PG&E offers free energy survey to customers. Call your rep and find out more. This survey is done free by PG&E, or through its other contracted firms on site. This program is funded through the PG&E customers bills. PG&E will send a customized report about possible areas of energy savings. Check out the link below and call your rep.

http://www.pge.com/mybusiness/energysavingsrebates/analyzer/onsite/

3. Retro-commissioning: PECI is a non profit energy efficiency firm that is contracted firm with PG&E. They administer retro commissioning services and incentives program. This program is eligible to facilities >100K sft, energy use >15KWH/sft annually, have some DDC( direct digital control) in place, condition of equipment- not in need of major retrofit. If you are interested in checking the eligibility of your property for this program, please check the website. I liked the idea that this program helps companies retro-commission their buildings and find savings. Similar programs are offered through San Diego Gas and Electric, Southern Edison utility companies.

http://www.peci.org/CxTechnical/Incentive_Programs/pgercx.html

4. PG&E rebate programs: One of the oldest rebate program managers spoke about PG&E automated benchmarking program. The tool helps you upload energy use data from PG&E bills into the Energy Star Portfolio Manager tool. They also offer a free training seminar on Energy Star benchmarking tool Portfolio Manager. The only requirement is homework before the class. The homework includes readying all data required for Energy Star Portfolio Manager. This is a great opportunity for property/facility managers and engineers to learn the basics of the tool in a hand on class with computers for each participant. One important tip from this presentation was: contact your PG&E and have his support through all the rebates and savings initiatives for higher success rates.

5. Load Management presentation from the President of Integrated Building Solutions. They make interface for building management solutions. He talked about demand response after the 2000 energy crisis in California. Property/Facility manager need to look at their load distribution using software that can show potentially controllable loads suitable for demand response. People might think what is demand response? I am not in a position to give an accurate explanation. I understand this as: measures that businesses/households can take to reduce electricity demand during peak hours thereby reducing the peak demand for electricity as whole for the grid. Hence not causing breakdowns, power outages and need for capital expenditure in new plants. If you want to read more, check wiki below.

http://en.wikipedia.org/wiki/Demand_response

PG&E offers incentives for business owners that cut down their facility’s energy use during peak demand times (typically 12pm-7pm). There are several programs at PG&E to choose from. Business need to implement certain changes to their metering system to be able to participate in these programs and most of the cost are covered through incentives. Check out the details if you need more info on P&E programs and requirements. There are many vendors in the market that provide technical consulting

http://www.pge.com/demandresponse/

http://www.ibs-cal.com/default.asp?path=Home

I wanted to emphasize that BOMA has some good educational programs. This one was worth the money for me. I would suggest attending upcoming ones. Keep a watch and check the BOMA-SV website for upcoming workshops.