Girding the Grid: How EnerNOC Sold Utilities and Big Electricity Users on Demand Reduction
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graphs comparing sites’ baseline and actual electrical usage, along with critical contextual data such as oil prices and temperatures in various regions of the country.
When utilities are looking for ways to prepare for periods of peak demand, they’re beginning to treat demand reduction exactly the same way they’d treat peaking power plants—by signing contracts with companies like EnerNOC and Comverge, who guarantee they will deliver a certain number of negawatts within a certain time frame. Of course, convincing utilities that demand-response technology would work and that such contracts could be fulfilled was another long battle for the company. “Electric power managers are not allowed be risk takers, because their job is keep the lights on for all of us,” Brewster says. “So we’ve always known that the burden is on us to prove that this is as good or better than the traditional modes of meeting peak power demand. But as we’ve grown, we’ve had hundreds of demand response events in our history, so now we have a body of work that we can point to that really makes knocking down that barrier much easier. Instead of PowerPoint presentations, we now have reams of actual data to demonstrate how quickly we are able to respond to grid emergencies.”
In fact, in California, the state public utility commission now requires utilities to look for ways to meet energy needs through efficiency and demand reduction before it will hand out permission to build new generating plants. That, plus concerns over greenhouse gas emissions, has created what Brewster calls “strong tailwinds” for EnerNOC. “Coal-fired power plants all over the country have been getting rejected based on environmental concerns, while demand for electricity is continuing to skyrocket,” says Brewster. “So demand reduction is getting more and more positive attention than ever before, in terms of being a real solution to our energy problems.”
Sooner or later, investors may realize that demand reduction and other efficiency measures made possible through advances in information technology aren’t options to be tossed away at the first sign of dropping fossil-fuel prices. Indeed, they’re the only way we’re likely to get a real handle on energy consumption and greenhouse-gas emissions— while still somehow managing to keep the lights on.
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