Oklahoma Gas & Electric needs kilowatts from all corners.
That includes homes, which are slated to curb 210 megawatts to help relieve summer peaks. It’s part of a master plan by OGE to reduce the need for new generation until at least 2020.
This summer is the first year when the demand response program has gone beyond a pilot to include tens of thousands of participants. Currently, there are 28,000 homes in the program, with a total of 35,000 expected by the end of summer that will deliver 72 megawatts of demand response.
“We’re on track,” said Mike Farrell, director of customer programs for OGE.
Based on the pilot, which had about 6,000 participants, the utility is looking for an average reduction of about 1.3 kilowatts from each home, although Farrell said that on days when OGE has called events, it’s been closer to 2 kilowatts in the mid-afternoon.
The utility is not just throwing spaghetti against the wall, but instead is targeting customers that can actually provide enough reduction to make the program cost efficient.
There are various marketing messages for different groups, too, but overall, Farrell said the cost savings was working far better than the environmental message.
Even though OGE is on track for the program, called SmartHours, which puts people on a variable peak pricing plan and gives homeowners a smart thermostat and a web portal, there have been bumps in the road. Currently, only about 16,000 of the participants have had their thermostats installed.
There have also been technical problems in some of the early events in the process of delivering the signal to the thermostat during critical peak events. Daily pricing has gone through about 90 percent of the time. Homeowners also get email, text or phone alerts when events are called. “This is really a test year,” said Farrell.
Eventually, the 210 megawatts will come from approximately 120,000 customers. Energate currently provides the thermostats, but OGE could look for additional hardware vendors to give itself some flexibility in meeting its needs.
The largest hurdle is just people and processes, just as with any new program. On the consumer side, people don’t understand peak pricing. The idea that electricity costs different amounts at different times of the day is a foreign notion to the average American. Education has been key, said Farrell.
There are limitations, too. With OGE’s program configuration, the ZigBee-connected thermostats can’t be controlled through a website, or more importantly, through smart phone apps. Farrell said it was the most common request that the utility received, but given the hardware the program is using and the platform configuration, it’s not an option unless the utility develops a unique code that corresponds to the Energate thermostat.
According to Farrell, there is currently no generic ZigBee code that can be leveraged to build mobile apps for any ZigBee product. For instance, if the utility brought in a second thermostat company, it would have to build another code for another mobile site.
Even without mobile capabilities, people have been giving positive feedback overall, including instances where users have called in to say how much money they’re saving. Of the nearly 30,000 participating in the program, about 500 have moved or dropped out, representing about 1 percent of the total number of participants.
Success is not just a nice feather in the cap, but a necessity. “We have to hit the goal to defer generation,” said Farrell. Of course, getting consumers on board with demand response is just one aspect of the program. OGE is also using energy efficiency, distribution automation, commercial & industrial demand response and load curtailment to cut more than 500 megawatts of peak demand in 2016.
OGE needs to slash peak in coming years, but for utilities that have a little more time on their hands, there is also an option to wait and watch as consumers purchase smart, connected thermostats on their own and then tap into those programs once they reach a critical mass. For many startup vendors in the space, like EnergyHub and Tendril, the software platforms they offer have overtaken the hardware offerings as the core of their business.
Texas retailers are also offering various thermostats to entice customers into demand response programs. EnergyHub said it was already signing contracts with utilities that want to leverage 3M Filtrete thermostats that run on its network. With different utilities offering large-scale programs to customers, it will be easier for other utilities to assess the best, and most cost-effective, options to connect the smart grid to the home.