Demand response programs are a contract between the utility and customer where the customer voluntarily curtails their load in response to a signal from the utility. The customer is credited for doing this. These programs allow utilities to incentivize commercial and industrial customers to voluntarily curtail their demand during certain peak periods. This allows the utility to meet overall demand without building expensive peaker plants that are used only in times of particularly high demand. The rapidly decreasing costs of energy storage are prompting more utilities to create demand response programs that both improve overall load management and keep costs reasonable for everyone.
The Smart Electric Power Alliance (SEPA), a trade group that helps utilities with the clean energy transition, reports that there were 155 demand response programs across the country in the year 2017. That number is growing as utilities search for less expensive alternatives to investments in new infrastructure and new ways to protect the stability of the grid during the transition to greater amounts of distributed energy.
HOMER Grid models financial savings from energy storage and load shifting, distributed generation systems that limit power consumption to critical loads when necessary, and the ability of self-generation generally to reduce electricity costs. The new HOMER Grid demand response feature allows users to explicitly model demand response events in their behind-the-meter renewable and storage systems, and determine the interplay between the costs of adding more storage and the credits available through the demand response program. Users can either specify how much they are willing to reduce their electric load, which may be set by their own internal needs, or they can let HOMER Grid determine what their best bid would be.
The newest version of HOMER Grid is available exclusively through the HOMER Energy website, and is available to use at no cost for 21 days. This is a free upgrade for existing licensees.