Get Paid to Temporarily Reduce Your Energy Use Through Con Edison’s Demand Response Programs

As the weeks get colder, it may seem strange to think of how to save money during the summer months. But Bisnow partner Con Edison says it’s never too early to start thinking of managing your energy use and their demand response program could save you—and even make you—thousands of dollars. We’re here to give you an overview of the program.

The Basics

Provided by Con Edison since 2001, the Demand Response programs are not energy-efficiency programs demanding a permanent reduction in energy use, but a temporary reduction upon request from Con Edison during only few hours per year—typically when energy use is at its highest.

The Goals

With the DR programs, Con Edison not only seeks to make energy more reliable at the distribution level by alleviating congestion, but it also wants to alleviate rate increases by reducing demand. The program also helps reduce generator emissions, delays the installation of costly equipment and lowers the need for expensive peak-day energy. Customers enrolled in the program can also receive some financial incentives for participation, as well as free access to a web portal to help them manage energy use.

While these goals are indeed very similar to the New York Independent System Operator Demand Response Program, the one key difference is Con Edison’s programs target the needs of the distribution system while the NYISO’s programs target the needs of the transmission system. You can participate in both the NYISO DR Program and the Con Edison Program simultaneously, which will get you the maximum revenue.

The Two Programs

Con Edison’s DR programs actually come in two forms: a contingency program (Distribution Load Relief Program, or DLRP) and a distribution system peak shaving program (Commercial System Relief Program, or CSRP).

In the DLRP program, you'll be called to reduce the electric usage in order to maintain the system reliability of your specific neighborhood. If a particular neighborhood needs load relief, Con Edison calls or emails you two hours in advance to inform you that a DLRP event will occur, asking to provide four to six hours of load relief. As such, customers will need to know if their facility can adjust and perform with only a two-hour notice.

The CSRP program, on the other hand, is based on and responds to forecast system-wide peak demand. In other words, customers in the CSRP program will be asked to provide relief at a certain time (the peak time of their local neighborhood). Because these peak times are predesignated at the start of the summer, Con Edison calls 21 hours in advance of an energy reduction. Because different neighborhoods experience their electric peak at different times, the call windows of the CSRP program can vary significantly from neighborhood to neighborhood. However, once the call window for a given neighborhood has been assigned at the start of the summer, that call window remains for the rest of the summer.

Both programs have two payment options: reservation payment, which gives customers monthly payments based on the amount of energy they've pledged to reduce upon request and additional payments for actual load reduced, and voluntary participation, where they will only receive payments if Con Edison requests and they reduce energy. Each payment option has its own application process and specific restrictions, and a customer can participate in one option in either one or both programs.

It is worth noting that those enrolled in the reservation payment option are also eligible for an additional, substantial three-year incentive payment by pledging an enrollment amount for two additional years that is equal to, or greater than, their enrollment in the first year of participation.

Who Can Enroll?

The program’s more than 800 enrolled customers include many different asset types, as seen above. The participating locations must have a Con Edison-supplied interval meter in place, which records electric use every 15 minutes. You can email Con Edison to find out if your location already has an interval meter.

Why You Should Enroll

Con Edison says that either DR program can help unlock the latent value of your property, serving as a potential source of revenue and helping you better manage your electric demand and gain a deeper knowledge of your facility’s energy systems. In fact, Con Edison believes that the program will help you use and understand your existing physical components to such an extremely profitable degree that you can use the money you save and earn to fund other improvement projects.

What You Need to Do

Relief doesn’t mean cutting off all your power, but more of a controlled reduction. Customers can reduce their energy consumption by turning off lighting, appliances and equipment.  Most participating customers have established load relief strategies for their buildings that don’t have a significant impact on their tenants. However, it's worth noting that the number of hours that you will be called for a DR event depends on the program you’re enrolled in, as well as your neighborhood’s peak demands.

How Much You Reduce

According to Con Edison, most customers reduce less than 20% of their highest summertime kW demand, but some customers’ reductions can reach up to 65% of highest kW demand. These latter customers, however, usually have industrial facilities that are temporarily shut down.  

How Much You Can Make

Con Edison says that a participating customer can possibly earn up to $50k over a three-year period for every 100 kW of load relief provided.

How Do You Enroll?

Enrollment—which can be completed by April 1, 2016—boils down to two questions. First, does your facility have a communicating interval meter that measures and records electrical use each hour? If so, you are able to enroll immediately. If not, and your demand is over 500 kW, Con Edison will provide an interval meter at no cost to you. If your demand is under 500 kw, however, you’ll be responsible for the meter costs.

The level of your demand response can also affect your enrollment options: if you can commit more than 50 kW, you can enroll directly or through an Aggregator, but if you cannot, you can only enroll through an Aggregator. More than 95% of DR participants enroll through Aggregators, who tend to keep a portion of the program revenues for their services.

If you’d like to learn more about the DR Programs, you can click here or email Con Edison.