Finding and Being Green With Demand Response

by William Grove, Rodan Energy

Demand response (DR) is designed to manage consumption during peak electricity demand through shedding or shifting of electrical load for short times. DR participants earn an additional revenue stream through their participation in the program. A growing number of companies in the U.S. and Canada are seeing DR success.

DR participants-whether commercial, industrial, institutional or municipality-are finding the program easy to implement and are reaping the benefits without affecting operating processes. The program puts money in participants’ pockets and allows them to help the environment and reduce their carbon footprints. There is no participant cost or capital investment required, and they can increase their program commitment usually at anytime.

Under DR3, the main DR program in Ontario, energy reduction is called for when demand and prices are high. Participants are paid for being available during the scheduled hours and receive additional payments for shedding or shifting their agreed-upon load. In the event of a possible activation to reduce load, program participants receive a standby notice the day before or morning of possible activation. In the event of an actual DR3 activation, participants receive an activation notice at least an hour and a half before activation.

Finding and Being Green With Demand Response

Many opportunities exist in most organizations to participate in local programs and earn substantial revenue. Adding an additional revenue stream is a desired component of program participation, but the benefits are more than financial. In Ontario, DR3 also strengthens electric grid stability and reduces the likelihood of blackouts during peak demand. It also addresses a common concern: reducing the need for carbon-emitting natural gas or coal-fired generation plants that many municipalities find undesirable.

If properly administered and promoted, a DR program can demonstrate to stakeholders, employees and customers a commitment to the environment.

DR strategies vary by business type, but generally reductions can be found in nonessential load of between 5 and 25 percent. A significant revenue stream can be earned without affecting product quality or quantity. Reducing the speed of variable speed drives on motors, for example, by as little as 10 percent can cut power consumption as much as 27 percent.

Another option is a diesel or natural gas standby generator. These can be used to take power offline from the grid, provided Ontario Ministry of Environment standards are met. For those facilities with generators already in place, an upgrade might be required to participate. In many cases, upgrading a generator pays for itself in the DR revenue earned.

Office buildings can get involved in DR by using their building automation systems or control systems to control building equipment. In high-rises for example, one elevator in a bank of three could be turned off or the down escalator could be shut off during a called DR event. Adjusting lighting by turning off every third light in common areas is also a standard strategy. Air conditioners can be turned off or temperatures adjusted while leaving only fans operating to circulate building air. Municipalities in Ontario with community housing buildings have participated in similar ways, or, if they have combined heat and power (CHP) generators, they may use the CHP as a route into DR. Organizations with a campus of buildings also have found DR success. Most of these DR participants have central power plants and have used absorption or steam chillers to facilitate their participation.

Experienced DR aggregators can find ways for all business types to participate. Professionally administered DR programs involve a site evaluation by qualified staff to identify opportunities and provide another view and opinion on how organizations can be more energy efficient and find DR success. A proof of performance test determines actual load available for shedding or shifting. Sometimes two tests are conducted to give staff the confidence needed to enter their chosen DR program and provide a full understanding of its program commitments. In Ontario, a reputable aggregator will enroll a program participant in four easy steps:

“- DR assessment. Energy managers work with participants to assess DR capabilities and develop strategies.

“- Performance test. As mentioned, metering and verification specialists guide participants through tests to determine DR capabilities to confirm DR value and identify challenges or additional opportunities.

“- Training on monitoring platform. Aggregators usually offer program participants some sort of Web-based monitoring system where they can view their program success in near real time.

“- Operation. Aggregators provide ongoing support to DR participants and manage all aspects of program participation.

Ideal loads for DR include equipment such as lighting, elevators, refrigeration, mechanical loads and dehumidification equipment.

Organizations across Ontario are using the tactics to find DR success, specifically DR3.

These companies are committed to the environment and have found a substantial new revenue stream.


William “Willie” Grove is director of business development at Rodan Energy, where he manages its demand response program in the Ontario market. He has experience in energy conservation, procurement, consulting and demand response in all industry types and market segments. Reach him at 905-625-9900 Ext. 236 or

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