When a heat wave gripped California a couple of months ago, authorities sent out tweets and texts urging businesses and consumers to reduce their energy use to help utilities and other power providers avoid blackouts. That was an example of demand response. And guess what? It worked.
James Muraca, the Chief Technology Officer at Enersponse, joins the show to explain how demand response can be automated and why it doesn't take a heat wave or some other kind of crisis for demand response to pay dividends. After all, demand response is when businesses and consumers shift their electricity usage during any peak periods. James outlines how automation and other demand response technologies are making grids more reliable and cleaner. That's right ... cleaner.
Not only can demand response help consumers take advantage of time-based rates or other forms of financial incentives, but advances in automation allow businesses and consumers to use more of their energy when the grid is generating more power from renewables. So demand response helps the grid go green and helps businesses and consumers save some green.
2:34 - What is Demand Response?
5:36 - The impact of the Inflation Reduction Act on Demand Response
7:55 - What new technologies are on the way when it comes to Demand Response
9:41 - The role of Demand Response during extreme weather and other crises
13:37 - What are the Price Response and Clean Response programs?
15:05 - How Demand Response can make the grid cleaner
16:13 - Demand Response and grid resiliency
17:04 - Demand Response as an ESG reporting tool
18:38 - Bold predictions
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(Note: This transcript was created using artificial intelligence. It has not been edited verbatim.)
Sean McMahon 00:00
Hey what's up everyone, and welcome to another episode of the renewable energy smart pod. I'm your host Sean McMahon. And today, we're gonna be discussing something that was a hot topic this summer, when temperatures got extremely hot. I'm talking about demand response.
A couple of months ago, during one of the heat waves that gripped California, and let's be honest, it seemed like heat waves were everywhere this summer. But anyway, during one of those periods of extreme heat, the California ISOs sent out tweets and texts urging consumers to reduce the energy they use to help utilities and other power providers avoid blackouts. That was an example of demand response. And guess what it worked.
My guest today is James Muraca, the Chief Technology Officer at Enersponse. James is going to explain how it doesn't take a crisis for demand response to pay dividends. After all, demand response is when businesses and consumers shift their electricity usage during any peak periods. James is going to explain how the latest demand response technology is making grids more reliable and cleaner. That's right… cleaner. Not only can demand response help consumers take advantage of time based rates or other forms of financial incentives. But the latest technologies allow businesses and consumers to use more of their energy when the grid is generating more power from renewables. So demand response helps the grid go green and helps businesses and consumers save some green. So I'm excited to get to that conversation with James. but first here's a quick word from the sponsor of today's episode. ABS Quality Evaluations
Get serious about sustainability. Assurance services from ABS Quality Evaluations can guide you with ISO certifications for Environmental, Health and Safety, Energy Management and more. Our globally accredited experts can help you become energy efficient and save overhead costs. Go to www.ABS-QE.com. Or click on the link in the show notes to learn more.
Sean McMahon 02:21
Hello, everyone, and thank you for joining me for today's episode. I'm pleased to welcome my guest James Muraca. James is the Chief Technology Officer at Enersponse. James, how's it going today?
James Muraca 02:31
Good. Thanks for having me. Excited to be here.
Sean McMahon 02:34
Yeah, I'm excited to bring you on talk a little bit about demand response. You know, a lot of our audience might know what that is and how it functions in the marketplace. But let's kick things off here was basic question, what is demand response? And what kind of role do you think it'll play in the energy transition?
James Muraca 02:48
Sure. Demand Response, I guess how I look at it we look at it is the utility has a bucket of money that they need to try to accommodate and keep up with people's energy growth within a region, they can spend that on new generation, power plants, solar, whatever else it is, or they can find ways to save energy, and we're on the save energy side. So demand response, we're definitely trying to go out and find customers who have something that they can shut down when prices are high when grids are stressed, when supplies limited. And those things could be supermarkets, lighting, heating, cooling refrigeration, it could be a water district with our pump, using gravity feed rather than the booster pumps, and manufacturing plants are all kinds of loads. But everybody has something to give. So we're looking at demand response, and specifically automated demand response as connecting utilities, grid prices, co2 emissions, back to energy management systems on site and shutting those down at really fine grained periods when the grid needs at most.
Sean McMahon 03:57
Okay, so you give a few examples of how this would work. So say you're at a supermarket and software is telling them, hey, now it'd be a time to kind of throw things back. How long does that last? What kind of levels are we talking about here?
James Muraca 04:07
Sure. So every customer is different. Every vertical is different. We're looking at, say retail stores, there's not much inside the building, right? You got some lighting, heating cooling systems. And what we will do is, there's a program for everyone and we go out and try to find customers with limited energy or lots of energy to save and and find a program that fits their needs. So in a retail example, heating, cooling, everyone can give one two degrees of temperature setback for an hour, two hours. And then what we do is we receive a signal from the utility from 4pm to 6pm. Please shut down. We then pass it on to that retail customer and they adjust their temperatures by two degrees and coast or allow the building to warm up by a couple of degrees and all within the comfort range. We want to make sure that customers aren't annoyed the salespeople and staff cinsaut on annoyed, and we don't want to disrupt things, we're looking for those longer term, we want them to participate next time as well.
Supermarkets, you know, larger loads, refrigeration, anti sweat heaters, you know, the thing on the front of the freezer, that makes you be able to see the, the frozen peas, we'd be able to turn those off these a lot of energy, water districts pumping loads, so pumping water to the top of the hill into a reservoir, and then into a tank and using gravity rather than electrically or a powered pump, to shut down those pumps and use gravity as the mechanism for distribution throughout the grid.
Sean McMahon 05:37
So much talk these days in the US, you know, in the energy sector, specifically in renewables is all about the inflation Reduction Act. So how does this technology and it's this demand response technology? What kind of role can they play in that?
James Muraca 05:49
At Enersponse we are a DR provider or where energy market access for a number of customers, I say different verticals across the spectrum. And, and we do that not necessarily, we don't call a retail store or supermarket and say shut something down. What we try to do is and do do is automate all those shutdown activations, right, we connect to systems, heating, cooling systems, energy management, SCADA systems in water, and industrial uses, and aim to partner with those control providers, importantly, who gave us access to the controls at those sites, one site in Southern California as a water district, or maybe your local supermarket regional chain with 100 or so on, right, trying to access all those on mass. So where I'm going with this in specifically for our IRA is, it's the feedback that we're getting from our partners that are going to make a lot of benefit and use from some of the things that are within that. And I guess, part of the major feedback that we're getting from control providers or manufacturers in particular battery storage, on site generation, for CHPs. Or whether it's gensets. One of the big key takeaways is the the ITC, the credit for projects has been increased or extended to 2025 and get to 30% of project costs. So one of our go to market strategies for quite a while since inception has been using rebates, whether it's in an auto DR rebate for you know, $200 a kilowatt for Project available for automating load that was there, but not necessarily controllable and putting it into a program. And the EITC extension within IRA is sort of giving a national footprint for that it's compensating 30% of the of a project for things that you may have been looking at beforehand. But now it's automating those and allowing those to be available for reliability or curtailment. In our case for DR. When the grids most stressed so that's for our partners, that's the part that we're most excited about.
Sean McMahon 07:56
All right now you're the chief technology officer, right? So let's go look kind of in the weeds there, what new technologies are either on the marketplace or in the pipeline that will kind of enhance demand response offerings?
James Muraca 08:07
Um, yeah, sure. It's definitely for us automation at scale, typically demand response and large peak management or energy saving programs have really targeted large loads, you know, multi megawatt water districts or manufacturing facilities, things that literally on a phone call, you can call and say shut down your building shut down your system and we you know, make a really big visible dent into the into the energy consumption on the grid, where, you know, Internet of Things or you know, cost savings on installed energy management systems across buildings. This the scale of visibility and control has definitely proliferated in industry. So we can connect to one control system, one supervisory system at a corporate headquarters, and from their control 1000 10,000 stores at the touch of a button or via Cloud connection. So for me being able to continually automate scale of sites, it's bringing on more sites in more markets, but also lower kW sites, or containable sites, you know, 25 kW, 50 kW, things that number one you couldn't call on individually, I couldn't call 1000 stores across the country and shut down. And it was cost prohibitive to call a single 25 Kw site previously, but in aggregate in a region across the country. By doing an API or, you know, an on site connection or Cloud to Cloud connection, we able to get that scale that hasn't been able to happen before.
Sean McMahon 09:41
All right now, we were gonna kind of take this technology and not trying to be like NBC lawn order ripped from the headlines, you know, but there's been some crises lately, right. There's wildfires in California, hurricanes in the Gulf. Are there any examples of how this technology has been used in those cases to reduce demand on the grid?
James Muraca 09:57
Yeah, absolutely. DR. Is Demand Response is absolutely a tool that we advocate or is used, you know, is one of those hot day type of tools, you know, in the case of, we see that in California regularly with Flex alerts coming down from whether it's the cursor or the governor issuing mandates, to shut things down and send text messages to everyone to behave really shut down your pool pump and your AC at home, or whether it's in Texas, you know, when ERCOT had a big freeze and the wind stopped blowing, it was froze over and the clouds covered the solar and, you know, gas generation shutdown. We'll call it on from an emergency reliability standpoint as well. The generation is not necessarily there for various reasons. can we mitigate the supply? And that's where we come in on the demand side to be able to can we shut down supermarkets and water districts and so on? So absolutely, we see it as from a liability as temperatures get up as grid megawatt usage is more need is needed more of we turning on gas peaker plants, and but we're on the other side of hopefully, can we shut down more load? That's for a couple of hours to instead of turning on something, let's shut something off?
Sean McMahon 11:13
I gotcha. Now, what are some of the specific offerings in a year the team and response have, you know, for the specific use cases?
James Muraca 11:20
Show us where across the country? If I go to programs, and then actually how we split up programs as well, across the country in all areas from New York, New England court, Texas, TVA, Arizona, California, there's a program for somebody everywhere, right? Typically, programs can be for six hours, they could also be on the other side of the scale, 15 minutes, right. Everybody cites energy users have a different appetite of how much energy they can shut down 15 minutes, I can shut down quite a lot, nobody's going to notice that the heating cooling is not on in my store. However, it may not be applicable for a manufacturing facility to shut down for 15 minutes or stop pumping for 15 minutes, because there's ramped downs of motors and back pressure in water, water districts and so on. But those loads are really good for for six hours, where a heating, cooling can't be shut off for four, six hours. So we absolutely you know, we handle this in two ways is find more programs and partner with different utilities or other program operators across the country to be able to find programs that fit everybody's bucket, but as an aggregator as well, by being able to match up different types of customers together within a portfolio, we're able to give some customers a little bit of the action on a six hour program that they may not have been able to have access to before because they're a small users with the big user and vice versa. So it's that flexibility of a portfolio of program access or within our own portfolio that allows us to match customers up.
Sean McMahon 12:54
We'll be right back.
Get serious about sustainability. Assurance services from ABS Quality Evaluations can guide you with ISO certifications for Environmental, Health and Safety, Energy Management, and more. Our globally accredited experts can help you become energy efficient and save overhead costs. Go to www.ABS-QE.com. Or click on the link in the show notes to learn more.
Sean McMahon 13:31
And now back to my conversation with James Morocco, the Chief Technology Officer at no response. All right, and I was doing a little bit of digging into your website before we came on today. And I saw there's a couple programs to clean response and the price Response Program. So price response, pretty straightforward, right? When the prices spike, and there's demand you help your customers kind of throttle back. What's the clean Response Program?
James Muraca 13:53
Sure. So both of these sort of internal programs within Enersponse, price response can actually be a little bit more complicated as well. And not just when the energy's prices high, you know, turn something off. These are happening in real time markets, right? So again, automated loads that can shut down in five or 15 minutes, because there's a five or 15 minute interval where it's high now, but where it gets a bit more complicated is really partnering with utilities or energy retailers, because some of those customers may have index or wholesale market exposure, say they have 20% of their builders that wholesale exposure. So when the price goes high, they have exposure to expensive prices. So we're using that as well. With utilities, we can use that as a as a hedge mechanism or with customers, allowing them to be able to increase their exposure to wholesale because we're going to cap hopefully their energy usage and tell them it's high cap their energy usage show across the average price of the year. They should actually have a lower average price then, because they had hopefully what And you're reacting to the low parts of those, those wholesale exposure prices from a clean response perspective, similar type of mechanism, right, as a as an aggregator as somebody, company who connects to utilities, we have a lot of data, not just prices. But we're seeing how the renewable makeup of a grid versus fossil fuel generation, we understand what the co2 or greenhouse gas makeup is at any point in time at a top level ISR level or down to a utility or regional level. So what we're able to do is feed that data in and make educated decisions on the grid is dirty. Now, let's tell our customers to shut down so that we're actually increasing the co2 that's reduced off the grid because it's the dirtiest time. On the flip side, the grid is very clean. Now. Let's turn on the fridges and freezers Let's Let's soak up some of that, you know, sun or wind that's generating and actually power our buildings from a cleaner as energy as we can. So you're sort of shifting or adjusting to the cleanliness or dirtiness of the grid as we can get.
Sean McMahon 16:04
It's interesting. I mean, I think a lot of folks associate demand response with throttling things back. But your program with clean it actually tells them when to crank things up. That's fascinating. So obviously, grid resiliency is of paramount importance these days, you know, what kind of role does demand response play there?
James Muraca 16:20
Yeah, DR, again, is really great for resiliency, it's it's because it's live, because we're automated and understanding what prices are what generation is being shut down at any given point in time, as we transition to, you know, in quotes, less baseload type of generation in solar or wind and, and being able to VR is used as a tool to fill those those gaps when maybe the wind isn't blowing as strong, and we need to find ways to save energy, again, looking at hopefully something that's cleaner, shut down a plant and compensate customers that way, rather than a builder another baseload type of generation. So as we transition to renewables, DR will play a quite a key role, too.
Sean McMahon 17:05
So what kind of role can demand response play? You know, this ginormous trend, we're seeing the shift towards ESG?
James Muraca 17:11
Yeah, it's definitely something that a lot of our customers are using demand responses, as I said, as one of those tools to be able to reduce their scope one to emissions, we think combining a couple of those things, clean response, and we're building out impact statements. So I know how much energy a customer curtailed or saved during a DR. event, I know when they saved it, I know what the co2 makeup was on the grid at any given time. And what's valuable to our customers is, as an energy manager for a company to, you know, quarterly report back to our CFO of DR. Not just made us dollars, but actually this is our co2 impact. And it's one of those extra tools alongside LED bulb replacements, or, you know, regarding our H HVAC unit, or whatever else, the use der is absolutely a tool to have a bigger impact on your your emissions.
Sean McMahon 18:06
So it sounds like it's something get off track across, you know, scope one, scope two, and scope three, right, your own sales reductions, but also your customers.
James Muraca 18:14
And we get a lot of our customers, you know, in that CNI world, our supply chain customers, you know, whether they're supermarkets or cold storage or agriculture, so they are, you know, filtering into their diverse scopes for somebody else as well. So, you know, it's an accounting thing all the way down. And hopefully, DR has a great mechanism to pay for some of that accounting in those projects, too.
Sean McMahon 18:37
So one of things I like to do on this podcast is I asked guests for their bold predictions. Do you have any bold predictions about how demand response will impact markets, you know, in grid sustainability, and the next, say, three to five years,
James Muraca 18:50
We see in demand responses, you know, another tool that utilities our customers can use in, you know, their cost savings, the grid reliability, and so on, in various different points. And as I said, as we get closer and closer to automation in real time, or using co2 or greenhouse gas emissions, we can start to do a lot more exciting things with that automation. The reality is that there's a bunch of customers who have connected things or sites that have connected things today. And really, for bang for buck, it's a really quick thing to implement to get things connected to start reducing energy and co2 emissions today. So it's going instead of having years worth of, you know, generation built out for of any kind, we can start to shut things down, you know, in a month or two with an integration today to quite large customers. So from you know, getting peak load management under wraps sooner, it's a great tool.
Sean McMahon 19:46
Okay, James. Well, hey, thank you so much for your time. This is very informational. And good luck.
James Muraca 19:51
Thank you for your time, Sean and hopefully chatting all the time.
Sean McMahon 19:56
So that's our show for today. But before we get out of here, I want to say one final Thank you to our sponsor, ABS Quality Evaluations.
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