FERC’s new rule on compensation for demand resources tips the market balance toward negawatts. Arguably the commission’s economic analysis is flawed, and the rule represents a covert policy...
Integrated demand offerings could be the next generation of energy management.
might indicate whether technology can become a driver of transformational change in energy and demand management, as it has in other industries.
Next Generation DSM
Are IDOs the next generation of energy and demand-management products and services? Only time will tell. What seems certain is that energy prices continue rising and are likely to rise more in the future. The demand for energy is increasing, and in a carbon-constrained economy, low-cost, low-carbon energy resources aren’t readily available. Energy efficiency and demand response will play a significant role in meeting future energy needs. However, the easy, low-hanging EE and DR opportunities already have been harvested. New approaches, products and services will be required to meet the increasing need for resources.
IDOs potentially could become the next generation of energy and demand-management services. However, to be successful, IDOs will need to be personalized, robust, easy, and valuable. That is, they must have the following characteristics:
• Personalized to respond to the customer’s or community’s specific energy problem and needs, and flexible enough to respond to changes in the customer’s or community’s preferences over time;
• Robust to provide a total solution that results in the desired customer experience. This includes commodity, energy and non-energy services as well as channels of communication, access and pricing;
• Easy so it is simple for the customer to understand, enroll and use. Rule-based logic is needed to assist customers. Easy includes providing the customer with tools to assist in their energy decisions as well as a platform to view changes and results; and
• Valuable to customers in that it meets their needs, assists in managing their energy costs and provides an enhanced customer experience. Valuable to the utility in that it assists in reducing the cost to serve and in improving the efficiency of the system.
IDOs could be designed to include these characteristics, provide that new approach, and move demand management from an end-use to an individual and personalized response. IDOs could be the next generation of energy and demand management.