Why transforming consumer engagement with demand response is key for utilities’ net-zero plans

The consumer’s position within the broader energy mix has been coming up frequently as a point of debate. Heretofore relatively static, with their energy consumption a given, consumer engagement is now becoming more of a priority as their flexible potential to save on MWh is more readily recognised by utilities.

This was the first theme of discussion during the Smart Energy Consumer Collaborative, hosted during GridTECH Connect in San Diego, California.

The discussion saw Darren Brady of Smart Energy Water (SEW), Scott Engstrom from GridX, Michael Sanders from Salt River Project and Nick Tumilowicz from Itron touch on different demand response initiatives that illustrate the necessity of such projects in transforming customer engagement and enabling them to play a more proactive role in a net zero future.

Demand side’s transforming role

For GridX’ Engstrom, who is the chief customer officer, there is already a fundamental understanding of how to change the supply side for a net zero future. The issue is that the demand side is still relatively unclear.

“When we look at utility websites and they describe how they’re going to [advance net zero by 2050]…what they focus on is how they’re going to change their supply… from carbon-based generation to non-carbon. As an industry, we have a pretty clear understanding of how that can be done. Decommissioning coal plants and gas plants; replacing them with renewable and distributed generation. Which is great.

“However, that really does fundamentally change the supply curve that we know today, which is significantly less dispatchable. And what that means is customers, the demand side, has to change radically.

“As an industry, we know less about how we’re going to make that happen. How do we really support the net zero carbon supply that looks very different than what the traditional demand curve looks like today?”

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Rate-based engagement

For Engstrom, a key way to do that is through TOU (Time of Use) rate-based consumer engagement.

Engstrom cited the TOU findings for GridX’s work with Southern California Edison (SCE).

During peak hours in August 2022, their residential TOU provided up to 75MW load reduction from enrolled customers, “which is pretty remarkable given that each customer is only doing half a kW or kW in reduction,” making it the utility’s third largest demand response programme.

And for consumers with tech such as EVs, heat pumps and battery storage, the demand response potential only increases.

Edison’s TOU-Prime, targeted at consumers with such tech, demonstrated a shift in 20% of energy usage away from peak times, enabling more renewable energy to come online during the day.

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Taking advantage of the potential from demand response

And with a proliferation of distributed energy resources (DERs) only continuing to come online, the value proposition offered by demand response is immense.

So how do we enable these programmes to be as successful as possible?

According to Tumilowicz – Itron’s DER director – who spoke on the engagement experience for EV owners, the consumer has a significant role to play in these programmes, and so they need to be educated on why such programmes are needed.

“I can’t tell you how many conversations I’ve had with families, where they say ‘I’m hearing on the news that we’re going to melt the grid…it’s a national concern’…which is why it’s so important to…really get visibility to see how these things are done.”

Whether grid-utility challenges, consumer data rights or the value of electrification, the consumer needs to be educated throughout.

The inaugural GridTECH Connect event is co-located with DISTRIBUTECH International in San Diego, California.