Western customers help shave California's peak demand

Modesto Irrigation District's voluntary demand-response program, Shave the Energy Peak (STEP), has delivered significant load reductions for the irrigation district over nearly 25 years. (Artwork by Modesto Irrigation District)

According to a report by the California Municipal Utilities Association, public power utilities reduced the state's peak demand by more than 50 megawatts (MW) and spent more than $54 million on energy-efficiency programs in FY05/06. Energy Efficiency in California's Public Power Sector predicts that by the end of FY06/07, those 39 utilities will save a combined 338 million kilowatt-hours (kWh).

The list of utilities in the report reads like Energy Services Bulletin's "greatest hits," since the newsletter has highlighted many of the programs and projects that contributed to those savings. Los Angeles Department of Water and Power and Sacramento Municipal Utility District, in particular, are "rock stars." The state's two largest public power utilities represented 63 percent of peak savings and 62 percent of annual savings from energy-efficiency programs.  

In such stellar company, the efforts of smaller power providers sometimes don't get the attention they deserve. But the report clearly shows that utilities of every size can find opportunities to save energy and reduce demand. 

Package deal on conservation

Gridley, Healdsburg, Shasta Lake and Ukiah are primarily residential communities in Northern California. Ukiah's municipal utility, the largest, boasts about 7,500 meters, and each of the others serves less than 6,000 meters. With few employees and limited resources, the four utilities decided to team up to meet state energy-efficiency mandates. In 2006, the partners contracted with Efficiency Services Group (ESG), a consulting firm specializing in utility-run, energy-efficiency and renewables programs of the type funded by California's public benefits charge.

The utilities had all operated their own energy-efficiency programs in the past, but California recently increased the goals and reporting requirements for public benefits programs. "We needed a more comprehensive approach to managing the programs, but we just didn't have the staff to handle it," said Ukiah Electrical Distribution Engineer Liz Kirkley.

So instead of four utilities each hiring full-time, energy services employees, they "chipped in" on a consultant with the experience they needed. "It was a cost-effective way to provide our customers with the most effective energy-saving measures, while meeting the new state reporting requirements," Kirkley said.

ESG created a package of incentive programs for the utilities based on programs that had been successful for other California power providers. "Then we added some custom features for their specific situations," said Jim Brands of ESG.

The utilities now offer a menu of residential audits and rebates for appliances, lighting, weatherization, geothermal heat pumps and air conditioning. Not included in the package but available as add-ons are a commercial lighting program and commercial and industrial (C&I) audits. ESG has also developed a solar power installation program in response to state legislation requiring all utilities to make them available to customers. "Our goal is to provide utilities with full-service, turn-key energy services programs," said Brands.

In the first two years the utilities offered the programs, the combined savings totaled 129 peak kilowatts (kW), 143 demand kW and 315,097 kWh annually. Not bad for little guys. 

Demand response works in Modesto

Modesto Irrigation District (MID) is almost 10 times the size of Ukiah but still small by California standards. The summer-peaking utility serves more than 114,000 customers, with C&I accounts representing about 55 percent of its energy sales.

In California's Central Valley, hot, dry summers and agricultural business drive the demand, and MID has a long, successful track record with demand response.

MID's voluntary "Shave the Energy Peak" (STEP) program, targeting residential and small commercial business air conditioners, has been operating for so long, most employees don't remember exactly when it started. "STEP has been around nearly 25 years," said Energy Services Supervisor Bob Hondeville. "It's given us some hefty load reductions and prevented expensive power purchases."  

The utility offers residential customers a $5-per-month credit and commercial customers $2-per-ton from May to December in return for fitting their air conditioners with a controller that allows MID to cycle the unit off and on during the hottest days. "About 13,000 residential customers participate in the program," said Public Affairs Specialist Kate Hora.

The program is promoted through direct mail and MID's monthly newsletter, which accompanies the electric bill. "We usually do a general announcement in March to give new customers a chance to sign up," Hora said. "We add about 500 customers to the program each year."

"A post card mailing goes to another group targeted for control unit replacement," adds Hora. This year MID should finish converting its oldest STEP control boxes from "ripple" power-line carrier communications to newer pager technology.

Industrial and larger commercial customers can opt into MID's interruptible demand reduction program. Customers can pre-select an amount of load they would be willing to curtail upon MID's request during the summer peak season. The customers receive a credit of $3.62 per kilowatt if they curtail the agreed-upon load. 

Hondeville said the irrigation district is also gearing up for the transition to automated meter infrastructure (AMI). "We are looking at a target of having AMI up and running around the end of 2008."

Opportunities for industrial customers

Once completed, the AMI system will enable MID to expand rate options, automatically connect and disconnect residential and commercial services and perhaps even provide a new platform for load control. 

All MID commercial accounts over 500 kW per month will soon be on a time-of-use (TOU) rate schedule. MID's industrial rates are mandatory time-of-use now, but much of its industrial load remains flat and very seasonal. "We serve a large number of food processors in the area, and they need power when the crops come in, period," explained Hondeville.

More definitive rate structures based on the detailed information an AMI system could give industrial customers greater incentive to manage their energy use. Given the nature of the food processing industry, Hondeville believes those customers may get more results from energy-efficiency measures. "We see a lot of potential for savings from upgrading lighting and compressed air systems, for example," he said. "Energy efficiency is a lot more interesting to these types of businesses than TOU rates," he added.

Where there is an interest in energy-efficiency, you can be sure that California's public utilities will come up with a program to satisfy it. And the only size that matters is the size of the energy savings.

Resources

California Municipal Utilities Association

Los Angeles Department of Water and Power

Sacramento Municipal Utility District

Healdsburg

Shasta Lake

Ukiah

Efficiency Services Group

California Public Benefits Charge

Modesto Irrigation District

People

Liz Kirkley

Jim Brands

Bob Hondeville

Kate Hora

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