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2005-09-15
Savings are biggest lure of DR programs
Restructuring Today, September 15, 2005
Cost savings are the primary incentive to participate in demand-reduction (DR) programs, a survey by the Distributed Energy Financial Group and Center for the Advancement of Energy Markets found.
More than half of those filling out an on-line survey ranked the opportunity to reduce peak costs or costs in general as highly important.
Nearly 70% prefer a market-based or mixed approach -- market and administrative but heavier on market incentives -- to DR programs.
Respondents were most aware of state programs, less aware of programs offered by RTOs and praised DR programs in California as well as those offered by PJM and the New York ISO.
The Midwest ISO’s programs were the least developed, respondents thought.
ISO-run programs that work best are easy to join, have high participation levels, good compensation for participants, pricing flexibility and effective implementation, among other factors, survey participants thought.
Poor program design, too many carved-out markets, lack of long-term commitment, too much utility influence and lack of supporting infrastructure were barriers to successful ISO DR programs along with “bureaucratic inertia and lack of creativity.”
More than half of respondents thought DR programs should be offered to all customer classes though most believed large C&I customers benefite most.
The flaw, of course, in web surveys is that most respondents were industry people -- fully one-fourth of them from utilities. Customers -- C&I and residential -- made up only a small percentage of response.
Contact mailto:ntreadway@defgllc.com?subject=Request Demand Response On-line Survey Findings for a free copy of a slide presentation on the survey. |
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