Designing a Successful Demand Response Program: It's Not Your Grandfather's Load Control Program

Panel: Commercial Buildings: Program Design, Implementation, and Evaluation

Authors:
Carmen Henrikson, EnerNOC, Inc.
Kristin Brief, EnerNOC, Inc.

Abstract

As demand response (DR) resources are increasingly becoming recognized as a costeffective way to achieve reliable peak demand reductions, the question of how to design a successful program must be explored. Improved enabling technologies and the emergence of third-party DR providers for procuring DR resources affords the expansion from traditional industrial or residential peak load management programs to include significant demand reduction contributions from commercial and institutional buildings.

This paper discusses the DR program design elements that directly influence the success or failure of a commercial DR program and provides examples of both successful programs and barriers to DR program success. It is presented from the perspective of a DR provider (also known as a Curtailment Service Provider or Aggregator) with experience in working with utilities and ISOs to design and implement successful commercial, industrial, and institutional (C&I&I) DR programs throughout the United States and Canada. This paper covers key DR program design elements including the following: defining program goals and success factors, determining competitive program compensation and structure, measuring performance, selecting response timing and notification processes, defining program availability periods, determining appropriate program triggers, establishing penalty provisions, and deciding upon program administration.

Finally, this paper provides framework for planning DR programs that can be replicated to achieve significant cost-effective and reliable peak demand reductions in the C&I&I sectors.