Berkeley Lab releases report on the State of Demand Flexibility Programs and Rates
In this report, Berkeley Lab provides foundational data on demand flexibility programs and rates in residential and commercial buildings in the United States in order to inform program and rate design and support regulatory decision-making. We describe the structure of demand flexibility events and the types and levels of incentives offered. We also report data on program outcomes, including enrollment and participation, energy and demand savings, and costs. We further detail the structure of dynamic rate events, report prices for critical peak pricing and variable peak pricing rates, and describe features of technology rates. Berkeley Lab will host a webinar on this report on Tuesday, October 15th at 11am PT/2pm ET; register here:
https://lbnl.zoom.us/webinar/register/WN_VO0fuZp2QQquXlaDrWeYSw
Demand flexibility programs and rates targeted summer afternoons and evenings.
Both the demand flexibility programs (see figure below) and rates in our study generally operate in summer afternoons and early evenings, which aligns with space cooling-driven peaks. Some Wi-Fi thermostat programs, however, do target winter morning peaks that align with electric space heating-driven peaks. Given that most U.S. utilities are summer-peaking, this focus on summer afternoons and evenings is appropriate. However, demand flexibility programs and rates will need to evolve to provide a broader range of grid services. For example, program designs would need to change if the electrification of end uses shifts peak demand into winter mornings in cold regions
Demand flexibility programs offer multiple types of incentives
Programs offer a range of incentives: upfront incentives to promote adoption, retention incentives to encourage continued enrollment, and performance incentives to drive demand reductions. The mix of incentive types vary by demand flexibility technology. Wi-fi thermostat programs typically offer both upfront and retention incentives and few offer performance incentives, which suggests the programs are targeting high enrollment rather than high savings per participant. Most battery storage programs in our dataset offer up-front incentives, performance incentives, or both.
We identified both dynamic and technology rates that promote demand flexibility
Most of the demand flexibility rates we identified were dynamic rates that responded to grid conditions (n=69), including critical peak pricing (CPP), critical peak rebate (CPR), variable peak pricing (VPP), and real time pricing (RTP) rates. Relative to the standard volumetric rate during events, residential CPP rates are 1-10 times higher and commercial CPP rates can be more than 10 times higher. The technology rates required that a customer have an eligible technology and included either a time-of-use rate, operating window requirements, or utility/third-party control. Many rates with technology requirements allow multiple technologies, but the majority apply to chemical or thermal energy storage.
Publicly available data on program and rate outcomes were lacking
We found limited data on program enrollment (n=27), participation (n=13), demand reductions (n=31), and program spending (n=21). We did not find data on reported enrollment or demand reductions for demand flexibility rates. These data were, therefore, largely insufficient to relate differences in outcomes to program and rate characteristics. The lack of data resulted from a lack of reporting and the aggregation of data from multiple programs (e.g. a Wi-Fi thermostat program was combined with all residential demand response programs). Standardized and expanded reporting of these outcomes would provide data that enables analysis of program and rate performance drivers.
For additional details, see the full technical report here.
Contact information: Sean Murphy ([email protected]), Cesca Miller ([email protected]), and Jeff Deason ([email protected])