Are Demand Response Programs Worth it?

Demand Response (DR) programs, while not new, are now gaining in popularity due to their value as an impactful measure to support grid stability. Traditionally, DR has been highly manual and most prevalent in the industrial and manufacturing sectors. However, now that Automated DR (ADR) technology is available, the commercial sector can easily participate and earn new revenue streams while supporting their local grid and utility programs. Read more on how DR works here.

GridPoint has deployed ADR technology across thousands of commercial customers nationwide through its smart buildings platform, and as an aggregator, GridPoint provides DR program management for many of them. GridPoint’s platform enables buildings to act as grid-interactive resources and can be integrated with other distributed energy resources, like solar or storage, to combine the benefits of these distributed technologies, create greater value, and help decarbonize and stabilize the grid. Because demand response has evolved so quickly through ADR technology, we often find customers that could benefit the most from DR participation are unwilling to participate due to previous or outdated misconceptions. Here are a few myths we’ve come across and the truth to set the record straight:

Myth 1: My building will be uncomfortable during a DR event

GridPoint works with customers to develop strategies that fit their specific needs. During DR events, which could last between 15 minutes and four hours, zone temperatures could be increased to achieve energy reduction during the event. However, the extent to which temperature is raised follows a pre-set limit decided by the customer. On average, a zone temperature is increased by 1.8 degrees for 1.8 hours. GridPoint ensures that zone temperatures remain at or below customer-specified limits in three ways:

  1. GridPoint pre-cools your location. For 90-120 minutes before an event, zone temperatures are reduced by 2-4 degrees depending upon customer specification and building condition requirements. Throughout the event, the store is permitted to ‘drift’ up to set point temperature. By pre-cooling, the store remains comfortable while conserving energy.
  2. GridPoint’s DR team works with each customer to develop curtailment strategies that provide both comfort to store occupants and reduces energy consumption. The set points can be as small as a 1-degree Fahrenheit difference in zone temp, or as large as a 4-degree Fahrenheit difference depending on customer specification.
  3. The curtailment strategy is highly customizable based on site-specific requirements. Specific zones can be entirely left out of demand response events if necessary.

Myth 2: I’m locked in for the whole demand response season and can’t make changes to my site.

Customers gain more control when they participate in an event when they work with aggregators.  GridPoint’s demand response programs permit customers to change the level of participation, strategy for participation, and choice to participate at any time during demand response season if necessary. The only exception to this is during a demand response event. During an event, curtailment strategies in effect are generally unable to be changed; however, at any other time, customers can modify participation levels – although, in GridPoint’s experience, the desire to modify participation rates and curtailment strategies is rare.

While some DR programs require nomination across an entire season, many programs enable customers to enroll every month, allowing adequate time for a site to experience DR and opt out the next month if participation results are not a good fit. These programs are a great way to “test” how demand response participation may or may not impact your site.

Myth 3: Potential DR revenue is not worth the time & effort required to participate.

Bundling ADR technology rebates and demand response participation payments provide a strong incentive (think thousands of dollars per site) with very little effort for small to medium business customers.

One GridPoint customer earned an additional $50,000 through demand response rebates and incentives alone in 2019. GridPoint provides a turnkey, fully automated, demand response program for customers. Aside from signing enrollment paperwork, there is very little customers need to do to participate. GridPoint’s demand response team manages all aspects of DR enrollment and participation. Through the GridPoint smart building platform, DR can provide a passive revenue stream for customers willing to change zone temperatures by as little as one degree for one hour.

GridPoint is focused on saving you energy and money so you can focus on what matters: your business. Demand response is a way to unlock additional revenue for your business with minimal impact on your business operations. Please contact us to learn more about whether your sites qualify for demand response programs.