Demand Response – What is it?
Demand response is a means of transferring economic benefit to energy users able to respond to periods of peak energy demand by removing all or a portion of their energy consumption from the grid when called upon to do so.
How Does My Business Participate?
Removing energy consumption from the grid can be done by activating an emergency generator or by switching off lights and other energy-consuming equipment. These actions are taken whenever circumstances on the energy delivery grid dictate, for example at times of peak demand, or upon sudden loss of a generator due to unscheduled maintenance or the loss of a power line due to storm damage. The grid operator will contact a “energy curtailment specialist” such as Good Energy, and convey instructions regarding commencement time and duration of the required curtailment event. The energy curtailment specialist will then contact the customers it has under contract and pass these instructions on to the facility managers who are able to ensure that the curtailments actually occur.
How Is My Business Paid?
The electricity delivery grid operator collects fees from all energy users. A portion of these fees are made available to ensure there is adequate capacity available so that the energy continues to flow in times of peak demand or unforeseen event. The availability of this excess energy capacity helps prevent blackouts. Parties able to offer excess capacity can receive payments through a responsible interface provider in the event they meet their curtailment obligations.
How Much Would My Business Be Paid?
The payment amounts can be substantial, but will fluctuate from region to region, and from period to period. For the most part, payment amounts are determined at auctions hosted by the energy grid operators. Gross payments are split between the responsible interface parties and the participating energy users.
Demand Response – What’s Next?
There are many other ways to participate, and the details of each program vary significantly by region. The next step is to contact your Good Energy representative to learn more about the available programs in your utility territory.