June 20, 2003—Commercial and industrial electric customers in Vermont learned recently about new options for savings on their electric bills through participation in Load Response programs. In a gathering at Champlain College, customers who have already saved from similar pilot programs, along with state utility regulators and operators of New England’s bulk power system, briefed participants on program benefits such as substantial financial incentives, improved electric system reliability, and mitigation of the effects of price spikes for all electric customers.
The Vermont programs are part of a New England-wide effort by the New England Independent System Operator (ISO New England) and the New England Power Pool under federally-approved programs—known collectively as the “Demand Response Program”—to address power system reliability issues and price concerns. Most Vermont electric utilities have developed one or more programs that have been approved by the Vermont Public Service Board.
Organizers said that Demand Response Programs help maintain bulk power system reliability and stabilize wholesale electric prices. The programs also help make wholesale electricity markets more efficient by letting customers respond to real-time market conditions by reducing load when prices are high. According to organizers, businesses can realize significant savings, utilities can control the impact of price spikes and threats to reliability, and all consumers reap the value of the environmental and financial benefits to the electric system.
Demand Response can mitigate price spikes by as much as 24 percent, according to a study by the Electric Power Research Institute, benefiting consumers across the region. The 210 customers already enrolled in Load Response programs across New England have the potential to reduce load by at least 284 megawatts should the need arise.
Three kinds of load response programs are available in Vermont to commercial and industrial customers who are able to curtail sufficient electric use. The programs, which vary by utility, include a Price Response option that provides payments to companies that temporarily reduce their electric load when wholesale prices are forecast to exceed a $.10 per kilowatt-hour threshold, and a Demand Response option that provides payment to companies that reduce their electric load in response to Internet notification of events that require load reduction for reliability reasons.
Customers can reportedly reduce load in many ways, such as turning off non-essential lights and office equipment; adjusting HVAC, refrigeration, and water heater temperatures; rescheduling or reducing manufacturing processes, operating on-site generators; and using an energy management system (EMS). The majority of consumers who participated in the 2002 programs reported no adverse impacts on their business.
The energy summit was sponsored by the Vermont Public Service Board and Department of Public Service, ISO New England, and Vermont’s electric utilities. For more information contact Stephen Terry, Green Mountain Power, 802/655-8408; Kerrick Johnson, Central Vermont Public Service, 802/229-9448; or Brenda Chamberlain, Vermont Public Service Board, 802/828-2358.
