Demand flexibility – best practices from a Colorado utility

The 43,000 member Colorado electricity cooperative Holy Cross Energy has introduced a choice of innovative customer energy savings programmes.

One of these is the Peak Time Payback programme that rewards members for reducing electricity usage over a two-four hour period when the forecast need is higher than usual.

Participants can gain as much as a $1/kW, depending on the critical level, and members as a whole can save up to $15/kW in avoided demand charges, said Lisa Reed, Energy Programmes Manager at Holy Cross, in a presentation at SEPA’s Grid Evolution Summit.

One of the biggest participants of the programme, Eagle River Water & Sanitation District, simply changed their water treatment and pumping runs, she said.

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“It saves them money and it saves the membership money in regards to power supply and creating more demand flexibility.”

Another is distribution flexibility bill credit, in which Holy Cross purchases a capacity call option from participants. They receive a set bill credit in exchange for the utility managing their flexible resources and making a call when needed.

A third under test is Green-up, which enables participants to take advantage of lower prices during periods of renewable over-supply.

“These programmes are providing clear evidence that demand flexibility is key on the journey to 100% renewables,” said Reed, pointing to best practices such as making programme enrolment and participation as painless and simple as possible.

With this in mind, a ‘programme with products’ platform is being developed to educate and engage customers and enable them to participate in programmes with the needed products.

Programme incentives

Tyler Rogers, Director of Utilities Sales at Energy Hub, agreed that flexibility programme engagement needs to be easy and ‘single-click’ to participate. He adds other opportunities including stacking benefits and the need for incentives, both upfront and ongoing, but cautions against linking incentives to performance due to the complexities in understanding that can arise.

He also cautions against over-communication.

“There is a need for balance for event and end of season communications,” he said, adding that other utility programmes such as energy reports and home audits should interconnect to the demand flexibility offerings.

Natalie Mims Frick, Energy Efficiency Programme Manager at Lawrence Berkeley National Laboratory, said their research had shown that customer propositions and acceptance are still challenges to the deployment of demand flexibility.

“We need more understanding of consumer preferences and motivations to inform programmes,” she said. Pilots under way at Portland Gas & Electric and Xcel Energy among others are expected to throw light on these issues.