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EETD to Operate Demand Response Research Center for California Energy Commission

The California Energy Commission (CEC) is funding a new Public Interest Energy Research (PIER) Demand Response Research Center (DRRC) that will be managed by the Environmental Energy Technologies Division (EETD) at Lawrence Berkeley National Laboratory (Berkeley Lab). The CEC will give $8 million over three years to the new center, which will be directed by EETD scientist Mary Ann Piette.

Demand response (DR) facilitates rapid, automatic reduction of energy use in buildings, industrial facilities, and homes when power prices increase or an emergency arises on the electricity grid. "Demand response refers to using technologies, programs, and policies, which allow building owners and managers to reduce their electrical use rapidly, in response to a jump in the price of electricity or a threat to the electric grid," says Piette. "Berkeley Lab recently tested the first automatic multi-building demand response technology using internet connectivity" (see Berkeley Lab Research News, February 2, 2004).

"With the opening of this research center," Piette adds, "the California Energy Commission has taken another concrete step to making demand-response programs a reality in California. The commission recognizes that demand response offers the state a powerful, rapid, market-based response to growing electrical demand." The Center will initiate planning through a scoping study to be completed in fall 2004.

"Demand response will prove to be a boon to the electricity supply picture in California in times of distress," says state Energy Commissioner Arthur Rosenfeld. "When combined with conservation and energy efficiency, demand response can both lighten the burden on the electricity grid and help stabilize peak pricing when supply becomes scarce and the demand margin becomes dangerously narrow."

Large commercial users who participate in DR programs create a plan to reduce electrical loads of their choice; the plan is executed in response to an automatic signal of a power-price increase or grid emergency. For example, users can decide in advance to dim or turn off lights, lower hot-water temperatures, reduce air-conditioning use, or shut down certain assembly lines or tools.

Being able to respond to electricity price signals in real time can save power users money, reduce energy consumption, and lower energy prices by making the power market more responsive to consumer needs in real time. However, the technology to implement DR programs in the U.S. is only beginning to be available, and much remains to be learned about how to most cost-effectively implement DR programs. In addition, DR has been identified as an important element of the State of California Energy Action Plan, which was developed by the CEC, California Public Utilities Commission, and Consumer Power and Conservation Financing Authority.

"The new research center will serve as a focal point for demand response research in California," says Piette. "Institutions from the around the state and the country will be eligible to propose and conduct R&D with center funding." Piette will oversee management of the research portfolio and facilitate a Partners Planning Committee which will, with the CEC, determine the center's direction.

The DRRC will support research in four areas:

  • Policies, programs, and tariffs: DR can be designed as an emergency response (i.e., in case of grid overload) or a price response (e.g., dynamic tariffs). Research needs in this area include improving our understanding of how customers respond to price changes versus emergencies and improving current methods of measuring energy savings from DR programs.
  • Utility markets, technology, and systems: This area includes intelligent and integrated systems for DR control and models of how DR programs affect the reliability of the electric power grid. Also needed are financial engineering models, such as option valuation models, to estimate the value of DR.
  • Customer and end-use technology and systems: A simple example of a project in this area would be the development of an easy-to-use computer-based system showing the energy savings possible from implementing certain energy reductions at a given price of electricity.
  • Consumer and institutional behavior: Studies in this area address how people interact with the energy system and how energy meets the needs and desires of people and businesses. An example would be a study examining which incentives bring customers into a DR program and which incentives will keep customers in the program over the long run.

An important feature of the new center will be its close ties to stakeholders, including control, metering, and information system developers; electric power utilities; policy makers; building owners, engineers, and operators; and building equipment manufacturers.

— Allan Chen

For more information, contact:

  • Mary Ann Piette
  • (510) 486-6286; Fax (510) 486-4089
  • Nance Matson
  • (510) 486-7328; Fax (510) 486-4089

For more information on the Demand Response Research Center.

This research is funded by the California Energy Commission's Public Interest Energy Research Program.

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