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Best Practice Guide |
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Commercial Office Buildings |
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Demand ResponseCommercial
Demand response programs are an easy way for businesses to ensure their own reliable and affordable electricity. Administered by local utilities or third-parties, these conservation programs notify participating businesses when to use less electricity in order to prevent electricity shortages or high spot market prices. Some demand response programs provide financial incentives or other benefits to customers who agree to reduce peak consumption or shift electricity use to off-peak hours. Peak hours are those times when electricity use is at its highest, typically between noon and 7 p.m. The California Independent System Operator (ISO) triggers demand response programs when operating reserves are expected to drop below seven percent, meaning that blackouts are more likely to occur. Low operating reserves occur because of high peak demand, unplanned generation outages, transmission problems, or adverse weather. If reserves drop, California ISO will notify program administrators, who then alert program participants. There are two basic types of demand response programs: reliability and pricing. Reliability programs are triggered the day of an electrical event to prevent or offset an impending emergency. Some are voluntary programs, meaning that there is no penalty should a business be unable to reduce its load. Other reliability programs are binding and invoke penalties for non-action. However, these programs are designed so that penalties are wholly or partially offset by financial incentives, such as lower overall rates. Pricing programs, on the other hand, are tied, in theory, to the spot market price of electricity. On critical days, pricing programs invoke higher rates for electricity used during peak hours. These higher rates are only put into effect for a maximum of 12 days a year. Participants in either program type (reliability or pricing) receive advance notification when electricity conservation is needed or new rates are put into effect. This extra response time allows businesses to prepare building occupants and work processes, greatly reducing the cost and inconvenience of power interruptions. Participation in demand response programs also helps avoid costly involuntary interruptions. Businesses interested in demand response programs should contact their local utilities to ask for a no obligation demand response audit. Similar to an energy audit, a demand response audit examines building equipment systems and operations to determine what opportunities exist for load curtailment. Your utility representative can then help you choose among the many programs available, matching your building's profile to the best-suited incentive packages. Demand Response Tips for Office Buildings
California ISO
Business ExamplesWhen the energy crisis hit California in 2001, Hewlett Packard Company (HP) looked for ways it could help avert rolling blackouts in their community. With partial funding provided by the California Energy Commission, HP installed an enhanced automation system at its Roseville facility that could work with its existing energy management system to increase automation. With the new system, HP can automatically control all lighting and HVAC equipment via direct digital controls. This allows HP to shed up to 1.5 MW of peak load without disrupting occupants or processes. Through its energy conservation efforts over the past eight years, including enhanced automation, HP Roseville has saved $1.5 million in energy costs each year. Besides working with the City of Roseville on voluntary load curtailment, HP also participates in PG&E's Optional Binding Mandatory Curtailment Program and another demand response program administered through the City of Palo Alto. HP has made similar automation enhancements at these campuses to facilitate quick response and accumulate significant energy savings. Although Qualcomm, Incorporated, does not participate in contractual demand reduction programs, it does voluntarily reduce loads when notified by the California ISO or its local utility, San Diego Gas & Electric (SDG&E). Reductions are managed through an internal web based process and depend upon the alert stage. Strategies include reducing lighting, building equipment services, and HVAC; increasing distributed generation; and preparing for emergency backup generation. SDG&E recognized Qualcomm in 2004 for their voluntary reductions. In order to meet its load curtailment requirements under Pacific Gas & Electric's Critical Peak Pricing program and California Power Authority's Demand Reserves Partnership program, Cushman & Wakefield installed new controls to the lighting system at Adobe Towers. First, conference rooms and perimeter offices were rewired for enhanced lighting zone control and General Electric (GE) Lighting relay controls were reprogrammed. This measure saves Adobe $93,000 and repays investment costs in less than 11 months. Second, Cushman & Wakefield installed a corridor lighting override switch, tied overhead lighting in the break areas to the emergency lighting circuit, and then set up the GE lighting relay control program with a normal daytime schedule. Previously, it ran 168 hours per week; the new schedule runs 7 AM to 6 PM or 55 hours per week with a one-hour interval override capability. Savings from this second measure are estimated to be $23,000 per year, paying back investment in less than three months. Neither of the estimated energy cost savings include incentive payments resulting from Adobe's participation in the demand response programs.
Resources California Demand Response Partnership. California Energy Commission, Information on Demand Response. California ISO, Information on Demand Response Programs Flex Your Power NOW! Demand Response Program. Pacific Gas and Electric, Information on Demand Response information. San Diego Gas and Electric, Information on Demand Response. Southern California Edison, Information on Demand Response Information Page. BPG Appendix 4: Demand Response Strategies (PDF download, 56 KB) |