Measuring the ROI of Demand Management for Utilities

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// If we want to think about the positive effects of demand management, let’s consider what happens to a utility on a local level when there is no demand management program:

  • Overall demand continues to creep up as new consumers are added at all levels. It may be mitigated by efficiency efforts, but demand continues to increase.
  • Distribution at the local level gets more uneven when large consumers are added in areas where the grid is weak. A new school, strip mall, housing development, or office building can add new demand where it might be difficult to provide.
  •  New renewable or other distributed energy sources can demand new transmission lines to remote places, while providing an erratic and unpredictable level of production that is difficult to balance.
  • Unfavorable patterns of excessively hot weather accompanied by droughts cause customers to increase air conditioning loading.

Do these scenarios sound familiar? What are the results of these trends? The utility is forced to increase generating capacity accompanied by major grid upgrades. The costs of these can be enormous and time consuming, and they might not be ready for your next crisis-prone hot summer.

Can something as simple as residential energy management avoid or at least mitigate all those problems? In many respects, the answer is yes if we realize that demand management begins with something as simple as a family paying attention to its energy consumption patterns. Adding a Wiser North America solution with its innovative hardware, engaging user apps and behavioral tools adds situational awareness and a means to respond. That response can be voluntary or actively managed by the utility. In either case, power consumption can be reduced when and where necessary, avoiding the need to bring another generation source online or relieving stress in a problem area of the grid.

Creating a program to distribute energy management tools with smart thermostats, provide the supporting apps, and set up your own control infrastructure is far less costly than a new generating facility, and the effect can be more immediate. Such programs do not take long to deploy, and once they take hold, problems begin to dissipate immediately.

Wiser North America can help you implement such a program starting today. The tools, techniques, and guidance are available now to enhance your relationships with your customers, helping them understand and manage their energy use. The technology works, and when applied properly, the result can be huge, delivering more stable generation and delivery, lower operating costs, better customer relationships, and increased profitability. All from a simple idea.

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