Demand Response


What is Demand Response?

  • Demand Response is a change in elec­tric usage by con­sumers in response of incen­tive pay­ments
  • The nation’s elec­tric trans­mis­sion grid oper­a­tors will pay you quar­ter­ly pre­mi­ums for your com­mit­ment that you will be able to tem­porar­i­ly reduce the amount of ener­gy that you con­sume if the grid ever needs your help

How Does Demand Response Work?

Con­sumers who can tem­porar­i­ly reduce elec­tric usage off the grid:

  • Usage Reduc­tion by turn­ing off cap­i­tal equip­ment, large HP motors and rais­ing AC tem­per­a­ture set points and reduc­ing a % of light­ing.
  • Gen­er­a­tors can be used but need to be in Com­pli­ance with  EPA Stan­dards (revised in 2016)
  • Pro­gram Peri­od: June 1 through May 31
  • June — Octo­ber, May: 10:00 a.m. thru 10:00 p.m.
  • Novem­ber — April: 6:00 a.m. thru 9:00 p.m.
  • EVENTS = any day (NO HOLIDAYS) Unlim­it­ed
  • Inter­rup­tion Dura­tion: 10 hours (His­to­ry = 4 hour dura­tion)
  • Response to an “EVENT”: Vol­un­tary, how­ev­er, no com­pli­ant vol­umes will equal pay­ment reduc­tion
  • 30 minute to 2 hours Event notice giv­en to par­tic­i­pants
  • Non-com­pli­ance dur­ing an “event” = reduc­tion in pay­ments (but nev­er out of pock­et)
  • 1 hour manda­to­ry test each year, if no events are called
  • Day and time of test announced in advance

Program Sponsor — PJM Interconnection (transmission grid operator):

An inde­pen­dent enti­ty, reg­u­lat­ed by the Fed­er­al Ener­gy Reg­u­la­to­ry Com­mis­sion.

  • PJM: Ensures the reli­a­bil­i­ty of the elec­tric pow­er grid across parts of Ohio and 12 oth­er states.
  • Pays you from mon­ey col­lect­ed by your local elec­tric util­i­ty com­pa­ny (when you pay your elec­tric bill)
  • Pay­ments per 100 KW of elec­tric reduc­tion

Why is demand response important?

  • PJM’s demand response pro­gram enables busi­ness­es to receive a rev­enue stream for reduc­ing elec­tric­i­ty con­sump­tion when the reli­a­bil­i­ty of the elec­tric grid is in jeop­ardy.
  • More than 8,000 com­mer­cial and indus­tri­al facil­i­ties par­tic­i­pate in a an area of 13 states

Why should I participate?

  • Gen­er­ates a rev­enue stream which can be eas­i­ly man­aged in dai­ly oper­a­tions.
  • You con­trol the shutdown/transfer to on-site gen­er­a­tion ver­sus a brownout!
  • Helps the com­mu­ni­ty and your neigh­bors
  • Enhances sus­tain­abil­i­ty
  • Mon­ey can be used to off­set gen­er­a­tor main­te­nance costs or to low­er util­i­ty bud­get
  • Avoids the need to build expen­sive peak­ing pow­er plants


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