Power companies are training their customers to see electricity supply in a new way, with two-way flows of information and energy that can increase reliability and prevent the need for costly transmission building.
“Demand response is creating business intelligence” in which companies can understand their exposure to time of use as well as overall volume of use when it comes to electricity, Constellation Energy Senior Vice President for Demand Response Gary Fromer told Breaking Energy recently.
“We’re exposing building management to energy market stimuli that allows for more than transparency, more than visibility – this is actionable information,” Fromer said.
Demand response has traditionally been as simple a process as utilities calling up their largest customers when the grid is under strain because of demand spikes, like those during summer air conditioning use, and asking those customers to cut back use. Often customers have been able to share in the savings from the event, but the human-led interaction has limited usage to periods of truly extreme strain, so that demand response events have traditionally been called just a couple of times each year.
With automated demand response technology like that offered by Constellation and the increased automation of systems within buildings themselves, demand response can grow from an occasional emergency process to one designed to fit a customer’s individual needs. It also give utilities the ability to segment their customers into those who care most about reliability, like data center operators, and those more sensitive to price.
Demand response technology integrated into buildings can provide more than a one-to-one benefit when operational, Fromer said. The technology reliance of large institutions means that reliability is key, so that a customer requiring near-100% reliability would have a different approach and pricing model than one requiring 80% reliability of supply.
Breaking Energy had the opportunity to experience Constellation’s VirtuWatt technology. Read more about that technology platform here.
For the customer so obsessed with reliability or controlling their own energy supply that they purchase distributed generation, demand response also has a role to play, and Fromer said that institutions using demand response to better manage and “balance” their off-grid load is a growing segment for his business.
The host of new customers taking advantage of demand response means that providers of that service – like Constellation – have adapted by making their programs available on multiple existing technology platforms. Use of existing technology is one of the leading trends in demand response, Fromer said, as the need for more-frequent and more-targeted curtailment grows at the customer level now that the energy consumer can better chart their power cost exposure.
“Customers need to think in an integrated way, with energy use and energy procurement functions meeting each other strategically within the company,” Fromer said.
