Electricity Companies

Making the connection to residential users

Demand response can involve a utility actively managing residential users’ energy consumption. This requires more infrastructure than just a smart thermostat. Here’s how it works.


As more Wiser home energy management systems are installed in individual residences, each of these represents a point that the utility can now talk to. Utilities can also talk to the thousands of sensors installed on pole transformers, substations, and all around the grid. That can quickly add up to be hundreds of thousands of devices creating enormous amounts of data. How does all that communication and data collection happen?

One of the companies that Schneider Electric has partnered with is AutoGrid, a provider of software for network management and demand response events. Amit Narayan, AutoGrid CEO, explains how it provides the platform that gathers data from all those sensors in the field installed on all manner of devices, including smart meters and Wiser energy management systems with smart thermostats.

So let’s say you’re in a serious peak demand situation and it’s time to take action by initiating a program of rolling HVAC reductions. AutoGrid has compiled the databases of customers that have signed on to the demand management program and installed smart thermostats. You know who has opted in, and who has opted out. Individual customers have other data attached to their records that help you make selections that will get the greatest power reduction while disrupting the smallest number of people.

The system moves through the thermostat resets, timing each carefully so as not to exceed agreed changes. It starts with one group of customers or regional area, and then on to the next. It sends notifications, either email or text messages, to the affected customers explaining what’s going on, and it all happens automatically. Your controllers determine how deep the cuts need to be, and it does the rest. The users who participate get appropriate adjustments on the next billing cycle.

This can be done directly, or the utility can send messages to all users asking for voluntary reductions, for which they will be rewarded. With a Wiser smart thermostat, that customer can easily call up the mobile app and make the adjustment to take advantage of the offer. Narayan says it’s easy for a user in a warm city to save $200 to $300 or even more annually doing this kind of thing.

He makes the point that demand response represents the cheapest and cleanest “source” of power for any utility. Considering that 20% of the total peak capacity today is served by generators that are used for less than 1% of total hours, demand response makes a huge difference. Those generators far down the list are invariably the most expensive and generally the dirtiest. Also, consider how much investment is tied up in that underutilized capacity. If that capacity didn’t have to be there at all, think of the money that could be used in other more profitable areas.

The bottom line ultimately is that the right combination of Wiser solutions and the right networking infrastructure can generate huge savings.


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