Peak Pay-Off
Meeting peak demand for power can cost utilities plenty. With demand-response programs, they’ll pay you to help cap the peak by trimming power use.
Reprinted article (pdf) from Building Operations Management, July 2008.
Article Excerpt:
Some power customers are getting paid to use less electricity — not just once, through a grant or rebate, but every time they deliver requested cuts in their demand. In a few cases, this extra revenue stream has reduced electric bills more
than permanent efficiency upgrades, such as lighting. One industrial customer claims to have cut the annual electric bill by 13 percent.
If facility executives are interested in achieving similar savings, then it’s time to join a demand-response program. When utilities and some state agencies offer customers money to install more efficient equipment, doing so helps control the peak electric loads that drive up the cost of power — for everybody. Assisting customer upgrades costs less than building new power plants that would be needed to keep up with the electricity demanded by their customers’ inefficient equipment. But many loads cannot be permanently reduced in a cost-effective or acceptable manner
Fortunately, some of those loads may be reduced temporarily without impacting comfort or business. Such reductions are sought when the power grid is stressed or when wholesale power prices rise beyond a certain level. Demand-response programs pay for kilowatts (or kilowatt-hours, depending on the program) avoided when a call is received to cut load. Under some demand-response programs, a customer owning a qualifying backup generator may be paid for agreeing to run it if called upon. Doing so has the same impact on the grid as a load reduction. In other cases, customers may have the option to bid load reductions in advance, just as an operator of a central power plant offers capacity. When wholesale prices rise far enough, those customers are first in line to get paid for their demand reductions.
Reprinted article (pdf) from Building Operations Management, July 2008.
Posted on Monday, August 18th, 2008 - Industry Articles