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The Future of Demand Response

June 17, 2014 - Power & Communication

Demand response programs reward on the micro level by reducing energy cost, as well as the macro level by helping to preserve the nation's failing infrastructure. The first priority for ensuring successful participation in a demand response program is to test and verify that the facility is operating the way it was intended. This goal provides an immediate benefit in reducing long-term energy use.

Utilities have long administered load-management programs for large institutional and commercial customers. Most of these programs targeted customers using more than 1 megawatt of power, but, building automation systems and smart meters are rapidly growing in popularity and utilities are rewarding customers who have committed to curtail their energy use during peak times.

Having the facilities' systems connected to a networked system allows for immediate response to real time data, as well as additional data to interpret the performance of buildings.

ISOs and utilities in more than 30 states offer demand response programs. One factor to the success of participation in these programs is the difference in the cost of electricity from state to state, which could be up to 30 cents. Customers who face higher costs for electricity are more likely to enroll in a demand response program.

Demand response is even being written into building code in some states. For example, California has made great strides towards energy efficiency and conservation. The state's Title 24 requires new commercial buildings or major renovations to install occupant-controlled smart thermostats. These thermostats must be capable of responding to demand response signs from utility companies over the Internet through automatic set-point adjustments during periods of high electrical demand.

One additional resource will arrive in 2015 with the publication of the revised version of ASHRAE Handbook — HVAC Applications. The book will include a section on demand response and will provide facility operators the tools and guidelines on ways to best leverage their facilities' systems during a demand response event.


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