Achieving Demand Response Optimization During COVID-19
Since the start of the COVID-19 pandemic, we’ve seen how the crisis has heavily impacted both energy usage and the efforts to reduce it. While residential and commercial energy users look for ways to keep energy costs low, they’re also faced in many cases with tighter budgets. Instead of abandoning ambitious energy efficiency goals, commercial and industrial energy users should look to demand response optimization to maximize energy efficiency – without breaking the bank.
How the pandemic has impacted energy usage
As our day-to-day activities shifted, so did our energy usage. With more people spending time at home, residential energy usage has changed drastically, resulting in electric bills increasing by 10 to 15 percent over the summer. In contrast, a portion of commercial and industrial electricity usage has dipped as businesses dial back or halt their in-person operations.
Residential energy usage has changed drastically, resulting in electric bills increasing by 10-15%.
Although the pandemic has exposed some vulnerabilities across the commercial industry, it’s also revealed opportunities to improve operations, maintain business continuity, and better withstand the effects of the current economic climate. Some of the measures businesses can take include:
- Investing in profitable energy-efficient solutions
- Modernizing technologies
- Making data-backed investments
- Optimizing operations to drive asset value
Better understanding energy costs
With the decline in energy consumption and wholesale prices comes the expectation that costs will follow suit, but that hasn’t been the case. Many businesses and facility owners have been surprised to see that while their kWh usage might have decreased by anywhere from 20 to 30 percent from last year, their energy costs reduced by only half of that. That’s because there are often static charges on both the bill’s delivery and energy side that are determined only during a few hours of the month or year.
Many businesses saw their kWh usage decrease by anywhere from 20-30% from last year, while their energy costs reduced by only half of that.
Demand response can fill in the missing puzzle piece to help energy and facility managers better understand the precise areas of usage that drive up costs. And a little bit goes a long way: between 15 to 30 percent of total annual electricity costs can be traced back to less than one percent of the year’s usage.
So, why the hesitation to embrace demand response?
Typically, the most common obstacle in demand response adoption is that it isn’t a “consistent activity.” This means that facility managers often prioritize more traditional energy efficiency initiatives because they’re carried out in the course of normal business: reducing total kWh, making permanent behavioral adjustments, or investing in more efficient assets.
While demand response is a temporary adjustment made to the “normal” profile of a customer’s electricity usage, these programs don’t have to be a one-time thing. Demand response can play a significant role in helping energy users to lower static charges over time, ultimately decreasing their overall cost per kWh. In addition to helping customers reduce costs, many demand response programs can also produce revenue.
Demand response can play a significant role in helping energy users to lower static charges over time, ultimately decreasing their overall cost per kWh.
Utilities or markets will often work with demand response aggregators or curtailment service providers, like THG Energy Solutions, to help them organize their demand response strategy into standard bids and portfolios based on location, size, and availability. By running a successful demand response program, facility managers can reap ongoing benefits like decreased energy demand, cost savings, and other financial incentives.
Leverage technology to tackle demand response optimization
To take on the tough task of demand response optimization, you need the right technology under your belt. THG Energy Solutions provides a host of forecasting features and alerts for active load management. The fully automated demand response (ADR) system can help energy users prioritize specific metrics and stay on top of changes in the grid.
Ready to learn more about how Urjanet and THG can help you take demand response optimization to the next level? Contact our data experts today.
You might also be interested in:
- The Tools You Need to Support Facilities Management Benchmarking
- eBook: Beyond the Bill: Refining Your Energy Management Program with Interval Data
- How to Ensure a Successful Energy Management Program
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About Ma-Keba Frye
Ma-Keba Frye is a Content Marketing Associate at Urjanet, assisting with content development and execution. When she's not writing, she enjoys reading, listening to music, and volunteering.