BYOD
Customer Engagement
Demand Response
EV Charging
Incentive Processing
Program Design
Program Management Automation
Flexible Dispatch
Virtual Power Plants
Platform
Grid-Edge DERMS
Customer Engagement
Demand Forecasting
Last week, the incoming administration declared a national energy emergency, the first time a president has called for this type of emergency. By enacting the National Emergencies Act, the President can activate special powers at the executive level to rapidly address a crisis. In this case, a declaration of a national energy emergency is intended to address increases of demand, while cutting through regulatory issues. Several energy industry emergencies need addressing, from demand on the rise to erratic weather patterns and beyond. Fortunately, utilities can address many of these concerns through available and abundant technologies—distributed energy resources (DERs) like solar, battery energy storage systems, electric vehicles (EVs) and EVSE chargers, and smart devices like thermostats and water heaters—to provide load shifting and energy arbitrage opportunities through demand flexibility programs like demand response, EV charging, or BYOD programs.
What’s the Emergency?
While the idea that the U.S. is experiencing a shortage of fossil fuels may be debatable, there are indeed numerous challenges facing grid operators including an increase in demand driven in part by electrification efforts, climate change, and extreme weather events damaging already costly and needed infrastructure; supply, and demand issues; and the continued proliferation of energy-hungry data centers. Furthermore, utilities have an enormous responsibility juggling regulatory and customer needs, the energy market, and more, so minimizing these challenges now can pay off dividends down the line. For example,
Demand is Rising
According to the Department of Energy (DOE), electricity demand is expected to grow between 15-20% in the next decade, doubling that figure by 2050. To meet this demand, the DOE supports increasing virtual power plant capacity from the available 30-60 GWh of available capacity to 80-160 GWh by 2030. The same DOE report identifies demand response as the largest current contributor to aggregate national virtual power plant capacity. As such, more demand flexibility initiatives are needed to meet this estimate, which requires renewable energy technologies to realize. Fortunately, these programs decrease costs for utility operations by minimizing usage during peak periods of consumption, decreasing the high costs associated with peak energy market purchases, and defraying extremely costly grid infrastructure upgrades.
Grid Interconnection Queue
As of 2023, the already long U.S. grid interconnection queue grew by 30%. This queue indicates a particularly keen interest in solar, battery energy storage systems, and other renewable energy technologies, which account for the majority of the projects waiting in the queue. Since the grid interconnection queue is so backed up, more than 80% of projects ultimately withdraw their application before the project reaches fruition. This troubling trend underscores the very real threat of high demand and not enough grid infrastructure, a challenge that utilities are struggling to keep up with. Demand flexibility initiatives cannot resolve these infrastructural challenges, nor can they decrease the length of the interconnection queue, but they can offer support during the energy transition to meet demand using existing behind-the-meter DER assets that are increasingly common.
Supply Shortage
Material shortages present a tangible threat to utility providers, who have struggled to keep up with the need for increased infrastructure including power transformers. According to the National Infrastructure Advisory Council (NIAC), the transformer industry was disrupted by the COVID-19 pandemic, which has resulted in a 2-4 year wait time for receipt of delivery. These technologies are critical to grid support, as a stop stopgap to ensure both safety and proper distribution along the grid. As with the grid interconnection queue, demand flexibility initiatives support these challenges by leveraging existing (and increasingly common) DER technologies to shift load and mitigate usage during peak periods of consumption.
Program Marketing
For more than a century, the paradigm between utility operation and ratepayer has remained relatively consistent: as a naturalized monopoly, the utility provides power to customers who pay for services rendered. As such, marketing wasn’t a concern, since regulated energy markets do not typically have any type of competition. With a growing distributed energy resource (DER) market, prosumer culture has taken off with customers invested in energy independence. The result is more behind-the-meter DER assets adopted by an eager public and electrification efforts that add encumbrance to the grid; connecting with those customers to enroll and engage them to participate is critical to getting the most from your demand flexibility initiatives.
– Syd Bishop, Sr. Content Specialist, Virtual Peaker
Demand flexibility leverages these encumbrances through aggregate load shifting and distribution, but is only as successful as the amount of people enrolled and participating in the program. While program marketing may not seem like an emergency in the same way that previous entries have, it does represent a missed opportunity for utilities eager to grow their customer programs. Fortunately, customer engagement software and program automation serve as outstanding customer management tools for engaging and communicating with customers, who according to polls are statistically likely to have an interest in green energy programs.
Demand Flexibility & The National Energy Emergency Conclusion
There are numerous challenges that utilities face, and likely more that remain undocumented here. Still, there are more behind-the-meter DER assets on the market today than ever before and more on the way, presenting an opportunity for utilities to leverage these assets through a Grid-Edge distributed energy resource management system (DERMS), which aggregates these resources for use in customer programs. Fortunately, demand flexibility initiatives address these concerns, both as a stopgap during the energy transition to help meet rising demand by leveraging available resources and as an economic opportunity to defray peak energy market costs.
Subscribe & Learn More About the Evolving Energy Landscape
