Perhaps Surprisingly, Residential Consumers Can Reduce the Most Peak Demand

Posted on August 3, 2009 at 6:48 pm

A leading consultancy, the Brattle Group, recently presented analysis results at the GE Smart Grid Forum showing that “Full Participation” by customers in peak reduction programs could reduce U.S. peak demand by 20% by 2020. And, based on pilot program results, residential consumers would provide half of that peak reduction, 10%.

On the one hand, this seems surprising, because residential consumers use only about 33% of total U.S. electricity each year according to the Department of Energy. On the other hand, these consumers can do much more to reduce peak, partly because they have more to start with. While DOE doesn’t know how much of the annual peak demand is residential consumers, their portion of the peak is much more than 33%. The California Energy Commission found that nearly all of the difference between average electricity demand and peak is driven by two sources: commercial air conditioning and residential air conditioning, with residential having the greater effect.

As proven in the pilots, residential consumers, on average, can reduce peak more easily, because they have more control over the timing of their energy use. Businesses need to keep lights on, refrigeration systems going, air conditioning on, and so on simply to run their operations and make money. In contrast, consumers can turn lights off, reduce the amount of air conditioning by limiting it to part of the house or going out shopping or to the movies, and shift loads like laundry, dishwashers, and vacuuming to off-peak times.

The result of all this peak reduction? Brattle says the savings would be over $50 billion by 2050.

- Chris King