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Report: Demand response is critical to enabling the energy transition and ensuring a reliable grid

September 11, 2023

Demand Response

Recently released research shows that mounting reliability risks make demand response (DR) increasingly important as the grid transforms. An aging grid dominated by solar and wind power, battered by storms and fires and struggling to supply new needs like EVs and electric heat pumps, needs the flexibility that DR provides.

“Paradigms for the generation and delivery of electricity are evolving away from a centralized network with predictable power flows toward a distributed and dynamic grid, creating many challenges and opportunities for utilities and other entities involved in the electricity value chain,” according to a new report about grid reliability challenges published by Wood Mackenzie and CPower. “At the heart of these changes is how reliability is assured when the grid is most stressed, like when customer demand peaks during heat waves, natural disasters or extreme weather events.”

Based on insights from analysts at Wood Mackenzie, the report shows that DR programs have proven to be an important resource for ensuring reliability amidst grid challenges in the past, but that such support may not always be available. Analysts explain how low capacity pricing and cumbersome rules on DR participation threaten the future of DR programs and the ability to use distributed energy resources (DERs) to help the grid.

If energy users were to stop participating in DR, analysts note, utilities and grid operators would lose their most reliable resource during emergencies as well as a resource that can provide much-needed flexibility year-round.

Such year-round flexibility is imperative because the proliferation of intermittent renewable resources, the retirement of fossil-fuel generators, and the electrification of vehicles, heating and other key energy needs are straining the grid, making it difficult to balance supply and demand.

“As the grid’s needs continue to evolve, particularly with the growth of other types of distributed energy resources (DERs) besides DR, such as solar generation, battery storage, and electric vehicles, DR is an increasingly important part of the resource stack in energy markets,” according to the report from Wood Mackenzie and CPower.

The North American Reliability Corp. recently issued a similar warning about the importance of flexibility in mitigating risks to grid reliability.

“System operators and planners should ensure that sufficiently flexible ramping/balancing capacity is available to meet the needs of changing patterns of variability and new characteristics of system performance. In future decades, growing storage and demand-side flexibility may help mitigate the concerns for flexibility and attention will turn to multi-day energy concerns, but intraday flexibility remains important during this transition,” according to NERC’s 2023 Electric Reliability Organization (ERO) Reliability Risks Priorities Report.

Today’s tech-enabled DR can play a key role in energy, ancillary services and other flexibility markets. But policymakers must eliminate barriers like unsustainably low pricing and unworkable administrative complexities to unlock the full flexibility of DERs, according to Wood Mackenzie and CPower’s report. To do so, the paper’s authors suggest market reforms such as revising compensation methods for DR resources, fixing capacity accreditation and introducing a price floor for DR.

If you would like to learn more about the research and recommendations from Wood Mackenzie and CPower, you can download a copy of the report here: Ensuring Grid Reliability with DERs.

 

Kenneth Schisler
Ken leads CPower’s regulatory and government affairs team, having previously served in similar roles at both Vicinity Energy and EnerNOC/Enel. He brings nearly three decades of policy leadership on innovation in clean and advanced energy technologies and collaborates with public officials, regulators, power exchange and system operators, academia and industry peers to unleash the potential of demand-side resources.

Contracting and Funding Projects with DER-Asset Optimization

August 08, 2023

Financing DER Projects

Securing funding and structuring a contract may be the hardest parts of developing new distributed energy resource (DER) projects.

Even with the Inflation Reduction Act set to catalyze billions of dollars of investment in renewable energy projects, financial viability – or the perceived lack thereof – has become a bigger barrier to deployment than technology. In a recent survey, microgrid developers ranked funding approval as the most challenging project stage, followed by project sizing and capturing upside monetization opportunities.

Getting DER projects greenlighted can be challenging because proformas often do not reflect the full value of the investment, or financiers discount project return projections because the tools utilized to estimate returns are not employed to realize value in live operations. Many times, DER owners and developers overlook opportunities to earn grid services revenue or reduce costs or do not realize projects can recognize both. Full visibility into a project’s value stack is essential to both funding and contracting DER projects.


Making DER Projects Pencil Financially

DERs are any assets that use, store, discharge, or generate electricity, like on-site generation, energy storage, electric vehicle chargers, solar panels, or load curtailment. Energy users are installing more DERs but only when they can make the projects pencil financially by connecting them to sufficient value.

Optimizing DERs involves choosing between all available value streams in each day or hour based on which would be most lucrative, and stream values can differ substantially depending on the details of the site and project. Successful DER projects justify investments by creating proformas that account for all possible revenue and savings based on the site and asset constraints and the available value opportunities.

If you are a DER owner/operator trying to fund a project, optimization starts at the proposal stage to enable an accurate view of all the on-bill and grid services value and ensure the asset is sized to optimize that value. Beginning at the proposal stage helps in sizing projects correctly and making even marginal projects pencil by considering all available value streams. Calculating the returns that a project would yield and demonstrating where they will come from and how they will be realized improves your chances of securing financing.


Getting Creative with Contracting Structures

In structuring your proposal and contracting structure for behind-the-meter projects, identifying the type of value and timing of realization of that value can be key to identifying creative contracting structures with the utility-account-holder. For example, monthly or annual lease payments from the utility-account-holder may be possible where on-bill value is the driving value source, or a split of grid service revenue may be a more reasonable approach where grid services are key to the project’s financial health. Identifying and executing on the ideal contract structures stems from a high degree of confidence in what sources of value will be realized post-contract.


Impacting Project Success

Overlooking opportunities at the outset can prevent a customer from accepting your proposal or limit the project’s eventual returns. Consider the returns from two DER projects in ISO New England (ISONE) as examples. One project used DER optimization but the other did not.


Project #1 (Not Optimized)

This customer developed a microgrid based on the energy user’s resiliency requirements and demand charge management expectations only. Although the project was approved and eventually met the customer’s requirements and expectations, it could have been more rewarding with a larger battery that would have provided incremental resiliency. The customer ultimately left money on the table because it did not consider the full stack of available value streams, and participation in other available programs such as ISONE capacity programs and Connected Solutions was suboptimal.

The participation of the generator was also limited by the lack of DER optimization. The customer invested in a generator that was permitted for emergency-use only and was specifically to address their resiliency requirements. With a DER optimization view and a full picture of all sources of potential value, the customer may have found that they could have contracted instead for a non-emergency-only generator and used that generator for both the resiliency requirements and to earn revenue by providing grid services. The revenue earned from grid services would have more than offset the added cost of a properly permitted non-emergency generator.


Project #2 (Optimized)

Conversely, another customer and benefited more from their project by considering all value streams and the full potential of DER optimization when designing, funding, and contracting their project. Beginning at the conceptual stage, they iterated on key aspects of the battery for a retrofit to a solar array in the PJM area.

Duration was one of the elements evaluated when modelling potential grid services values in PJM. After considering several duration iterations, the project developer decided that a one-hour battery would provide better returns than a multi-hour battery based on anticipated value streams, cost considerations, and warranty constraints. As a result of determining the right size for the battery upfront, the customer increased its projected return and is now set up to take advantage of all revenue streams.

Such potential to benefit from multiple revenue streams is always helpful given that the financiers of DER projects want as many revenue sources as possible. Diversification of project revenue sources and greater returns increase the chances of securing funding.

Securing funding for DER projects may be hard, but DER optimization makes it easier. Considering and pursuing all value streams from the beginning helps projects pencil and increases returns.

If you would like to learn more about why energy users and DER portfolio owners are turning to optimization solutions that evaluate site-specific performance data and energy market options to create project proformas that get projects greenlighted, watch our presentation from the 2023 Microgrid Knowledge conference: The Greatest Bang for Your Buck: Getting Projects Contracted and Funded with DER-Asset Optimization.

You can also call us at 844-276-9371 or visit CPowerEnergy.com/contact to find out how our EnerWise™ Site Optimization solution makes estimating and delivering the value of DER projects easier.


Rob Windle

As CPower’s Vice President, Strategy Planning & Business Development, Rob keeps a curious eye locked on the future. He leads the development and management of innovative solutions that support the proliferation and monetization of distributed energy resources (DERs) such as decentralized generation and energy storage. He has more than 20 years of experience in product development, direct and channel sales development, and management across the Energy, Enterprise Software, and Automation Controls industries. A Certified Energy Manager®, he holds a Bachelor of Science degree in industrial engineering from the University of Cincinnati and lives in Atlanta, Georgia.

DER Monetization the Key to Enabling the Energy Transition

April 18, 2023

DER Monetization

When the grid is stressed, would you rather turn on a fossil-fuel-powered peaker plant or tap into existing resources to reduce our electricity consumption? For us, it’s a simple choice for the community and our planet.

The Customer-Powered Grid™ is the answer. In aggregating customers’ distributed energy resources (DERs) and collectively using them to help the grid when and where it’s needed the most, we can create a flexible, clean and dependable future.

Peaker plants are major emitters of greenhouse gases and have a negative impact on air quality and public health. By leveraging DERs that are already available, like demand response, we can help reduce carbon emissions and other pollutants to help mitigate the impacts of climate change.

 

DERs Counter Climate Change Impact

Customers recognize the potential of DERs, which are assets or devices that consume, store or generate power and can respond to a signal, as well. Sustainability is the second-most-common reason for implementing DERs, with one in three customers citing it as a motivation, according to CPower’s 2023 Customer-Powered Grid Survey.

The grid needs more clean energy, which DERs can supply reliably and affordably, and that need for flexibility is growing:

    • Annual additions of renewable power capacity globally must grow three times the current level by 2030 to limit global warming to 1.5°C or less per the Paris Agreement, according to the International Renewable Energy Agency (IRENA). This would require investing $35 trillion in energy transition technologies worldwide by 2030, IRENA estimates.
    • The clean energy transition must accelerate for the U.S. to avoid the worst climate impacts, according to the Business Council for Sustainable Energy (BCSE), which noted that 2022 was the third most costly climate disaster year on record with 18 climate-related disasters causing at least $1 billion in damage each. The country needs modernized and expanded infrastructure to accelerate the deployment of clean energy and energy efficiency solutions, BCSE says.
    • The U.S. is only halfway to its emissions reduction goal for 2025 and slightly more than a quarter to its target for 2030. It must double the share of electricity generated by non-carbon-emitting sources by 2030 to achieve net-zero carbon emissions by 2050.

We won’t be able to ensure grid stability through this rapid transition and beyond without DERs. DERs such as demand response and energy efficiency support greater deployments of clean, renewable energy resources by filling gaps in variable generation. Given their flexibility, DERs can quickly respond to changing grid needs at any time, like if renewable generation unexpectedly drops due to a decrease in the availability of sun, wind or gas.

DERs also reduce the need to build new generation capacity, which is crucial because we must quickly replace coal-fired power plants like the peaker plants that have historically provided flexibility to the grid. The U.S. is on track to close half of its coal generation capacity by 2026 and cut coal consumption by the power sector in half by 2030, all of which could affect the stability of the grid.



CPower envisions a flexible, clean and dependable energy future enabled by The Customer-Powered Grid™.

 

DER Monetization Supports Sustainability.

Energy users benefit from investing in DERs and by monetizing them through grid services. More than 88% of CPower customers say that DER Monetization has helped their business. In addition to saving money by curtailing their loads when the grid is stressed, these energy users can take the revenue generated from their participation in wholesale market or utility grid programs to improve or invest in operational or sustainability initiatives for their organization.

Energy users are also under significant pressure to reduce emissions, make ESG investments and counter the impacts of climate change. DER Monetization helps an organization achieve its clean energy goals by allowing it to use less electricity and reduce associated emissions.

We are proud to have helped our customers avoid more than 280,000 metric tons of CO2, equivalent to not burning more than 317 million pounds of coal, in a single year alone. We know that the work we do is essential in making our vision of a flexible, clean and dependable energy future enabled by The Customer-Powered Grid a reality.

This year, we are also supporting sustainability as an organization through our internal initiatives as well as by donating to EarthDay.org, whose mission is to diversify, educate and activate the environmental movement worldwide.

Clean energy commitments by companies — and the pressure others face to keep up — are becoming watershed moments for the energy transition. From technology and manufacturing companies to real estate and big-box retailers, companies are committing to decarbonization.

By investing in clean energy, using less electricity and participating in utility and energy market grid services, energy users can help fill the role now played by gas generators from central systems. That is, why burn fuel to power a peaker plant when you can use DERs to balance the grid when it’s stressed?

The answer is obvious to us. How about you?

Join us on the journey to the Customer-Powered Grid — and the flexible, clean and dependable energy future that it will enable. Call us at 844-276-9371 or visit CPowerEnergy.com/contact to learn how we can help you most effectively invest in DERs to support sustainability, improve grid reliability and increase energy resiliency.

 

Shelley Schopp
As Senior Vice President, Customer Fulfillment & Human Resources, Shelley leads CPower’s Operations team. With over 25 years of experience in the energy industry, she helps the company share its collective wisdom through every touchpoint CPower offers.

Three Reasons Why Your DER Strategy Isn’t Working

February 16, 2023

The next phase of a reliable and clean energy mix will center on deploying more distributed energy resources (DERs) and using them efficiently.

DERs have become increasingly prevalent, largely due to available market revenue streams, opportunities for demand charge mitigation, falling hardware prices for storage and renewable generation and deployment incentives like those in the Inflation Reduction Act. However, up until now, DERs have been mostly used through strategies centered solely on either tariff-based cost avoidance or confined to limited grid services program participation.

DER project owners and operators that only focus on cost avoidance or just participate in capacity programs, which require load reduction commitments ahead of time, often leave value on the table. To unlock the full value of DERs, owners and operators must balance priorities and make decisions based on changes in conditions like asset availability and market prices for energy resources. Only then will DERs fully contribute to a Customer-Powered Grid™ that enables a flexible, clean and dependable energy future.


Common Hurdles to Maximizing DER Value
 

Maximizing DER value requires a comprehensive strategy. If you do not earn as much grid services revenue as possible and achieve the on-bill savings that you could, your DER strategy may not be working for one or more of the following reasons.


1. The strategy doesn’t consider all DERs.

DERs are any asset that consumes, generates or stores electricity. Or, to put it more simply: If it can reduce demand “behind the meter,” it can be considered and included in your DER strategy. These can be generation assets like generators, solar, co-gens and storage, but can also include energy curtailment and even energy efficiency.

The supply of flexible DERs, including load curtailment, onsite storage, electric vehicle (EV) fleets and other resources, is set for massive growth because the grid needs more flexibility to avoid failures caused by an aging infrastructure and the rising penetration of intermittent, renewable generation.

DERs that can be enrolled in demand response (DR) programs with short lead times, called on frequently, and be highly automated are particularly valuable. DR is the largest DER available in the market, and you don’t need anything other than the flexibility to curtail load to benefit from it.

As the need for flexibility increases even further, and existing and new DERs are incentivized to participate, including all your DERs in your strategy will become ever more important. Accounting for all your DERs is crucial because the more flexibility they collectively provide, the more valuable they are to the grid.


2. Underlying goals and the programs that will help achieve them haven’t been identified.

Unlocking latent DER value often begins with determining your goals. For example:

    • Are you pursuing all available financial benefits? Such as on-bill savings, grid service revenues and incentives? Optimizing returns requires considering all simultaneously.
    • How important is resiliency? Do you want to avoid business interruptions and associated revenue losses? Do you need back-up power? And, if so, what’s your non-emergency strategy for these assets? You may be able to earn revenue by supplying flexible capacity to the grid or to save money by using on-site generation and/or storage assets to reduce demand.
    • How can your DERs support your organizational objectives for sustainability? Customers and partners increasingly want to do business with organizations that share their concerns about helping the environment. You may also have to comply with regulations like limits on carbon emissions.

The best strategy for your facility will accomplish all your goals within a comprehensive framework of programs.


3. There is not an efficient plan for implementing DERs.

Unlocking the maximum earning potential of a suite of energy assets in complex markets requires creativity, focus and sophistication. Multiple DER projects, implementers and consultants can result in conflicting strategies.

Unfortunately, however, when it comes to problems that owners and operators face in optimizing their DERs, most solutions fall short in one or more areas. They:

    • Solve for grid services or on-bill savings – but not both.
    • Support only one type of DER asset – not multiple.
    • Depend on manual workflows and processes – instead of automation.

If a solution doesn’t solve for both grid services and on-bill savings, support multiple types of DERs and also automate workflows and processes, then your DER strategy doesn’t work. Therefore, you do not maximize the return on investment (ROI) in your DERs.


A Single Solution for DER Optimization

However, optimizing your DERs does not have to be complex. CPower’s EnerWise® Site Optimization solution can help you fully unlock the combined value of grid-services revenue and on-bill savings – in a single solution.

In automatically identifying and executing the most lucrative energy management strategies across on-bill savings and grid services programs and the different types of DERs, EnerWise addresses all the challenges around the optimization of DERs. A virtual energy manager, it maximizes the financial return, resiliency and sustainability benefits of energy storage, onsite and renewable generation and other DERs.

For example, in terms of financial benefits, EnerWise can help you:

    • Easily estimate and deliver the value from DER projects.
    • Justify DER investments and generate forecasted revenue and projected savings.
    • Shorten your DER project’s ROI horizon and maximize the financial return.

It also offers resiliency benefits such as:

    • Avoiding business interruptions by ensuring that back-up power is available.
    • Optimizing DERs’ usage according to resource and regulatory constraints.
    • Leveraging automated scheduling technology to manage your resources 24 hours a day.

And, when it comes to sustainability, EnerWise can:

    • Support organizational sustainability goals.
    • Redirect carbon-free power to help grid operators reduce reliance on fossil fuel resources.
    • Enable the transition to a cleaner and more reliable grid.

EnerWise has been named a finalist in the prestigious 2023 Edison Awards due to the energy optimization technology’s ability to help DER owners and operators get the most out of their assets. It is being honored in the Innovative Solutions and Services category for simplifying the approach to participation in multiple energy-market and utility programs.

Through its dynamic hourly scheduling customized for each site, EnerWise ensures each DER is allocated to the most lucrative available programs on an hourly basis, with one site averaging a 54% increase in grid revenues. It has expanded to 40 new sites across PJM and recently launched in ISO-New England.

EnerWise has drawn strong interest from DER owners and operators across crypto mining, government, education, manufacturing, retail and other commercial sectors who want to gain access to new value streams from their DERs.

If you would like to learn more about EnerWise or other ways to optimize your energy assets, call us at 844-276-9371 or visit CPowerEnergy.com/contact to find out how we can help you create and implement a DER strategy that works.

Customer DERs Relieved Grid Strain and Reduced Electricity Demand During Winter Storm Elliott

January 17, 2023

CPower customers helped grid operators avoid blackouts by providing over 50 GWh of electricity reduction during Winter Storm Elliott. Customers responded to 197 unique dispatches across three demand response programs in PJM and ISO-NE alone, which together cover all or part of 19 states and Washington, D.C.

In quickly curtailing their loads, CPower customers helped the PJM and ISO-NE regions avoid grid failures as freezing weather caused widespread power outages elsewhere in the country over the two days before Christmas.

“This storm underscores the increasing frequency of significant extreme weather events (the fifth major winter event in the last 11 years) and underscores the need for the electric sector to change its planning scenarios and preparations for extreme events,” NERC President and CEO Jim Robb said, in announcing that FERC, NERC and NERC Regional Entities have launched a joint inquiry into the operations of the bulk power system during Winter Storm Elliott.

With extreme weather events occurring more often, in both winter and summer, regulators and grid operators increasingly look to customer DERs to keep the power on during times of high energy demand. CPower customers, for example, were dispatched a record 1,030 times in 2022.

 

Electricity Reduction was Key in Winter Storm Elliott Response

During Winter Storm Elliott, CPower customers responded to dispatched events in PJM’s Emergency Capacity and Synch Reserves DR programs as well as ISO-NE’s Active-Demand Capacity Reserves (ADCR) program. The PJM Emergency Capacity dispatches were the program’s first winter events since the 2014 Polar Vortex.

PJM dispatched roughly 4,000 MW of DR on Dec. 23 and another 7,000 MW on Dec. 24 as capacity dropped and demand rose. Power demand rose to a peak of 135,000 MW on the evening of Dec. 23 while forced outages reached as high as 34,500 MW. Demand then remained high overnight, thereby preventing some power plants from replenishing their fuel supplies. By the time the morning peak came on Dec. 24, which was the coldest day of the Christmas weekend, PJM was missing approximately 57,000 MW of its generation flee due to winter storm challenges.

Similarly, unexpected generator outages and reductions and lower-than-expected imports led to a shortfall in operating reserves in ISO-NE, prompting the grid operator to dispatch DR twice as part of its efforts to balance supply and demand and maintain reliability on the regional power system during the evening peak hours of Dec. 24. ISO-NE declared a capacity deficiency and implemented measures under Operating Procedure No. 4 (OP-4) after 2,150 MWs of resources scheduled to contribute power during the evening peak became unavailable. Measures included using reserve resources to balance supply and demand and requesting conservation at market participants’ facilities.

 

DER Participation Alleviates Grid Strain During Extreme Weather

Historically, grid operators have called upon customers for load relief in summer months when demand has typically been highest due to extreme heat. However, winter electricity demand has increased in recent years due to extreme cold and heating electrification. For example, industry leaders cited big growth in electric heat as a chief cause of blackouts during Winter Storm Elliott, noting that over the past decade the number of households heated with electricity had surged by about 20% in the hardest hit states of Tennessee, North Carolina and South Carolina.

With heat electrification expanding and severe cold becoming more common and spreading further across the country, customer DERs are important in providing load relief and preventing blackouts during extreme weather events year-round.

CPower is the national leader in unlocking the power of customer DERs, with 6.3 GW of capacity across more than 17,000 sites in the U.S, and its customers are vital in strengthening the grid where and when it’s needed the most, as evidenced by how they provided load relief and energy reduction during Winter Storm Elliott.

Furthermore, CPower has hosted a webinar to help businesses in PJM understand the increasing importance of DERs in providing grid resiliency during winter months and learn how they can get paid for providing load relief to the grid. To watch, please click here.

 

Dann Price

Dann has specialized in PJM Demand Response for more than 10 years. As CPower’s Executive Director of Market Development for the PJM market, he is responsible for keeping hundreds of customers with thousands of sites up-to-speed on market conditions, energy prices, program particulars, and regulatory issues in the ever-changing PJM demand response market.

 

Mike Hourihan

Mike is Market Development Director at CPower. He has extensive experience in analyzing and developing market rules in multiple energy markets across North America. His career has focused on advocating for demand side resources participation in the energy markets as a reliable low-cost option compared to traditional generation assets.

Data Centers Have the Grid’s Answer for the Fourth “D”

November 29, 2021

Much has been made in the energy industry during recent years of the “3 Ds,” the macro trends of digitization, decentralization, and decarbonization that have driven the electric grid’s transformation toward a cleaner, more dependable, and efficient future.  

The 3 Ds are generally considered to be positive trends rooted in good intentions for the grid and society.  

There is, however, a fourth “D” that has been nothing short of a costly troublemaker for the grid since its inception and threatens to undermine every good deed the original 3Ds seek to accomplish. 

“Disruption” has been the grid’s ever nemesis since Thomas Edison fired up electricity’s first electric grid in 1882 at Pearl Street Station in lower Manhattan. Like any arch-villain, disruption has a knack of showing up at the most inconvenient of times, particularly when the grid is already vulnerable. 

Consider the most disruptive grid events of the last decade. Most were weather-related and resulted in blackouts.

Actually, we don’t have to flip too far in the history book for evidence of weather-related disruption pushing the grid to the brink of total failure. The tragedy this past February in Texas when record winter temperatures forced the ERCOT grid to suffer its first blackouts in a decade is a prime example of disruption’s wicked handiwork. 

The California blackouts in August of 2020 that took place during an extreme heatwave in the western US are another example and prove that disruption doesn’t partake in an offseason.

Unfortunately for the grid, disruption is a devil that takes many forms. The COVID pandemic is a prime example. 

The lockdowns during 2020 led to electric loads shifting from commercial buildings to residential, which caused grids across the US to work overtime to ensure electric supply and demand remained in balance.

Like death and taxes, disruption may very well be an inevitable fate for the grid. Yet throughout history, fate has had a way of swinging favor back toward the good guys. 

Demand response, the practice by which organizations are financially rewarded for shifting load from the grid during times of stress, is a case in point. 

We’ve previously written how demand response has been in the US electric grid’s defense arsenal for decades. Today, with the proliferation of distributed energy resources (DERs) adding to that arsenal, demand response has proven to be an even greater thwart to grid disruption than ever before. 

Data Centers, with their penchant for owning on-site DERs such as backup generators and energy storage, are in a prime position to participate in demand response and help the grid fend off disruption when the last (or any) of the 4 Ds rears its ugly head.   

Across the country, an increasing number of data center organizations are realizing how helping the grid pays immeasurable dividends for their local communities. 

During February’s grid collapse in Texas–which tragically resulted in hundreds of citizens losing their lives–data centers proved to be the local heroes. 

Data centers participating in demand response programs provided flexible energy resources at the critical times when the ERCOT grid needed them. These resources played an integral role in keeping the grid from a total collapse, which ERCOT has stated was minutes away and would have kept much of the Lone Star State in the dark and freezing for weeks.  

For their helping the ERCOT grid, these Texas data centers earned a substantial demand response revenue payment. But it’s their stewardship of community sustainability that should be noted and applauded. Fortunately for data centers,  sustainability recognition for demand response participation is starting to garner measurable notice

Demand response and all forms of demand-side energy management allow the grid to continue its transition from a fossil-fuel-dominated past to a renewable energy future. 

Disruption, be it of the foul weather variety or some other adversarial pill will be waiting in lie around every bend of our journey to energy’s future. Within their sophisticated suite of behind-the-meter energy assets, data centers have the antidote to disruption’s poison. 

The modern world relies on data centers’ megabytes. The grid and local communities nationwide are counting on data centers megawatts

To learn more about how data centers can help the grid, reduce their carbon footprint, and improve their local communities’ sustainability, download CPower’s latest ebook: “A New Age of Demand-Side Energy Management.”

 

 

 

Three Reasons Your DER Strategy Isn’t Working Like You Planned (and how you can be creating more value)

September 07, 2021



The electric grid is amidst a transition to a cleaner more dependable and sustainable future. Today, the grid needs flexible resources many organizations currently possesses to complete that transition. These Distributed Energy Resources (DERs) include: energy storage, generation, demand response, energy efficiency and many more. The solution sounds simple, implement DERs, help the grid, improve sustainability and lower energy costs. But for most, this far more complex that it sounds. Join us for this 30-minute webinar to learn the four reasons that your DER strategy may not be working like you planned. It’s never too late to create or adjust a strategy that saves resources, drives better resilience and grid reliability, more cost savings and a predictable revenue stream.

Watch now to learn these four common errors and what you can do to get your strategy on track for success through site-level optimization, automation, and holistic energy management.

Key Takeaways/Learning Objectives:
What is driving the Grid and DER evolution
The four most common reasons DER strategies don’t deliver
How to start improving your DER and Energy Management strategy today
How to maximize the value of your assets

Presenters:
Rob Windle, Executive Director, Distributed Resources

Mr. Windle directs his energies to expanding the monetization of distributed energy resources (DERs) such as decentralized energy generation and battery storage. DERs allow energy consumers to generate financial cost offsets and revenue benefits from increased energy markets participation while leveraging existing and planned systems infrastructure and assets. Previously, He has more than 20 years of experience in direct and channel sales, channel program development, and management within the Energy, Enterprise Software, and Automation Controls industries. Mr. Windle is a Certified Energy Manager and serves as a board member of the Technology Association of Georgia’s Smart Energy Solutions group. He received his Bachelor of Science degree in Industrial
Engineering from the University of Cincinnati. Mr. Windle and his wife live in Atlanta, Georgia.

Millie Knowlton, Sr. Manager, Strategy & Business Development

Millie is the senior manager of strategy and business development at CPower Energy Management, a leading national energy solutions provider. In her role, Knowlton leads new product development and commercialization. Prior to CPower, Knowlton spent four years at Tesla working in commercial energy storage, grid services, and project development. Knowlton has a master’s degree in Environmental Change and Management from the University of Oxford.

ERCOT’S Roadmap to the Future Includes Distributed Energy Resources

August 24, 2021

On July 13, 2021, ERCOT announced the delivery of its “Roadmap to Improving Grid Reliability,” a 60-item plan that addresses needed improvements to ERCOT’s electric grid with the aim of avoiding future failures like the one experienced this past February when much of the state was left without power and over 200 people died amidst record-setting winter temperatures.  

In an official press release announcing the Roadmap’s delivery, ERCOT Board member and Texas Public Utility Chairman claimed the map “puts a clear focus on protecting customers while also ensuring that Texas maintains free-market incentives to bring new generation to the state.”

The notion of the free market is one we at CPower have often discussed in explaining how the ERCOT market differs from others around the country. From its very founding, ERCOT’s energy-only market was designed to let economics, not legislation, drive the action within its marketplace. 

In the wake of February’s tragedy–and the harrowing death toll certainly qualifies the event as such–there has been a wealth of debate in Texas and throughout the US on whether ERCOT’s economically driven approach to grid reliability is the best way to avoid future grid failure.

There is one curious item in ERCOT’s 60-item roadmap that is worth pointing out to large consumer and industrial organizations in Texas.

Item 19 concerning the future of distributed generation, energy storage, and demand response speaks to both legislative and financial methods of exacting change on a grid seeking to cross the bridge to energy’s future. 

Item 19 of the roadmap reads as follows: 

“Eliminate barriers to distributed generation, energy storage, and demand response/ flexibility to allow more resources to participate in the ERCOT market while also maintaining adequate reliability”

With this item, which is “on track” according to the roadmap, we see ERCOT is well on its way to implementing an improvement to its market that is rather similar to the intent of the Federal Energy Regulatory Commission’s Order 2222, which states:

“Order No. 2222 will help usher in the electric grid of the future and promote competition in electric markets by removing the barriers preventing distributed energy resources (DERs) from competing on a level playing field in the organized capacity, energy, and ancillary services markets run by regional grid operators.”

Language like what ERCOT submitted in its roadmap with item 19 wouldn’t raise an eyebrow had it come from any other deregulated US energy market outside of Texas. 

ERCOT Grid Control center in Texas.

That’s because other state and regional energy markets must comply with Order 2222 within FERC’s mandated period of time. ERCOT does not.

Here’s why:

Because its grid is isolated from the surrounding states, ERCOT’s market does not engage in interstate commerce and is therefore not under FERC’s jurisdiction. 

Yet ERCOT appears to be on the road to creating a future marketplace that allows its grid to integrate the flexible DERs CPower and other demand-side energy management companies have been touting for years are necessary to maintain a balanced, dependable grid that is evolving to a cleaner future.  

Here we have an example of ERCOT agreeing with Federal legislation despite the truth that they are under no legal obligation to do so. 

Why? 

In the simplest of terms, Order 2222 is a piece of legislation aimed at fostering just and reasonable competition in the wholesale marketplace. 

ERCOT’s market is and always has been designed with competition in mind. Look no further than item 19’s language for proof that the future of ERCOT’s grid involves allowing more energy resources to enter the marketplace and compete, not fewer. 

ERCOT is expressly stating that it believes more distributed generation, energy storage, and demand response in its marketplace is the best way to ensure a more reliable grid for Texas and more value for its market participants. 

As the Supreme Court is fond of saying, it is written. As Texans like to say, let’s get to work and take care of business.

 

 

 

Demand Response Has Been Part of America’s Energy Plan for 40 Years. Why Should the next 40 be any Different?

April 22, 2021

The idea that reducing a watt of energy on the demand side can be just as valuable as generating one on the supply side in a time of grid stress is hardly new. Nor is the idea that such a solution helps thwart both energy-related and environmental crises. 

The origin of demand response can be traced to roughly forty years ago when both the US and the world grappled with many of the same energy and environmental issues we are still trying to solve today. 

Let’s take a trip back to the mid-late 1970s and see if a few things don’t look and sound familiar.  

The oil crisis of 1973 sent shockwaves throughout the world, raising concerns on the security of electricity supply in the US while pointing to a need to diversify the nation’s power generation mix away from a fossil fuel dependency and toward a mix with a greater share of renewable and clean energy sources. 

Global environmental awareness had grown to a movement large enough to be seized upon by newly-elected American president Jimmy Carter who, within a month of taking office, donned a cardigan sweater, sat before a roaring White House fire, and urged Americans to join him in conserving energy in a nationally-televised fireside chat.

During that broadcast on February 2, 1977, the president related how a particularly harsh winter had depleted the domestic supply of natural gas and fuel oil. He warned of dark consequences that awaited the most powerful country on earth if we as a nation failed to devise a sound energy plan for the future. 

Sound familiar?

The 39th POTUS didn’t outright cite demand response as a means to a profitable and sustainable end that night in 1977, but he did allude to the Public Utility Regulatory Policies Act (PURPA), a piece of legislation that would be enacted in 1978 to promote more competitive energy markets in the US by allowing “non-utility generators” to participate in them. 

The act would prove to be a landmark piece of legislation, setting the country on the road to conservation and the development of clean and renewable energy sources. It would also open the door to demand response as a viable solution to keeping both the electric grid and the environment in balance. 

That open door paved the way for the deregulated, competitive energy markets we have today to replace the vertically-dominated regulatory ones that had existed for most of the 20th century. It also would prove to be the seed that would soon mature and bear the lucrative fruit of modern demand response. 

Fast forward back to the present. Federal legislation is still working to ensure energy markets remain competitive with clean and renewable energy sources securing a just and reasonable position place in them. 

Order 2222 from the Federal Energy Regulatory Commission (FERC) is a case-in-point. The Order is the latest in a series of directives aimed to create a fair balance between traditional generators on the supply-side and distributed energy resources seeking to enter markets on the demand side.   

Issued in September 2020, Order 2222 calls for the removal of barriers preventing distributed energy resources (DERs) from competing on a level playing field in the organized capacity, energy, and ancillary services markets run by regional grid operators.”

Order 2222, widely hailed as a landmark achievement in the history of the energy industry is about more than just creating more competitive markets. By allowing DERs, including demand response, their just seat in the marketplace, Order 2222 enables the US electric grid to take a giant leap toward a cleaner future. 

Consider this recent data on demand response performance in the US:

In 2019, the most recent year for which the data is available, the combined wholesale demand response capacity of all regional system operators in the US grew to 27,000 MW. 

How much environmental pollution did all that demand response save the country in 2019 by providing a resource that would have otherwise been supplied by a traditional “peaker” plant?

According to the EPA, the 27,000 MW of capacity from all commercial DR participation in the US in 2019 prevented the greenhouse gas emission equivalent of what an average passenger vehicle would produce were it to drive a little more than 142 million miles.

That same total of reduced load roughly converts to the carbon dioxide emission equivalent of 63 million pounds of coal being burned. 

In 2020, CPower’s more than 1,700 customers contributed more than 4,000 MWs of capacity to demand response,  effectively reducing the energy equivalent of 7 million pounds of coal that would otherwise have been burned and released into the environment. 

Helping the grid stay balanced and keeping the air clean aren’t the only benefits to demand response. 

The global demand response market is projected to value at USD $24.71 billion by 2022, an increase from the $5.7 billion valuation of the same market in 2014,  according to a recent report published by Million Insights market research firm.

Much has been made in this publication and others in the energy industry about the evolving electric grid and demand response’s role in helping to bridge past, present, and future. 

As you read these words, energy markets and electric utilities across America are refining their demand response programs and introducing new ones, providing organizations with a lucrative and socially responsible way to use their energy assets to support grid reliability in this critical time of transition. 

America opened the door for demand response nearly forty years ago. Closing it now (even just a little bit) would be a step toward the past in a time when the country should be crossing the bridge to energy’s future.

Power Shift: How DERs are Creating a New Balance of Power (Webinar)

November 11, 2020



What will electrical power consumption in North America look like in 2050? Will centralized power generation still dominate, or will distributed energy resources–DERs–shift the balance of power generation to the energy end consumer? Our presentation takes “a look back” from the future to show how expanding DER implementation is laying the groundwork for a new balance of power, freeing organizations to independently pursue sustainability and reliability goals, and how monetizing DER energy assets is accelerating that shift. Our case study reveals how one university monetizes solar, battery storage, and demand-side energy management strategies to power its future, today.

Learning Objectives:

  • Examine How the “balance of power” will shift from generators and utilities to the end energy consumer over the next decade.
  • Explore the ways in which flexible demand and aggregation at the consumer level will change the grid infrastructure.
  • Investigate the impact that distributed energy resources (DER) and microgrids will have on the state of grid modernization.
  • Identify additional renewable resources, beyond solar and wind, that will see the greatest increase in adoption for both supply and demand of electricity.
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