Thursday, August 20, 2009

Smart Grid: Is Demand Response Doomed? (COMV; ENOC)

From Greentech:

Demand response companies could face pressure from providers of technology that lets utilities turn down peak power use by themselves. Or those demand response aggregators could take over that market.

Is demand response in it for the long haul?

Demand response service providers like EnerNoc and Comverge – which curb power consumption at homes, offices and industrial sites, often during peak periods – say yes. After all, for years they've been gathering together utility customers, installing devices and networks to turn down key power-using devices, and delivering reliable "negawatts" of power not used to mitigate the peak power demands that make up a significant portion of utility's overall costs.

But the longer-term promise of two-way communicating smart meters to could replace those demand response systems with hardware and software the utilities can own and operate on their own. And if two-way networks that allow customers – particularly homeowners – to play a part in deciding when their air conditioners power down become more widespread, that could pose a serious threat to demand response aggregators middleman role.

For the time being, it's a bit of an academic argument, says Tendril CEO Adrian Tuck. But it won't be for much longer.

"The idea of one-way load control systems, where you just turn things on and off, seems to be receding," he said. "In its place is coming a next generation product [from Tendril and others] that offer a much more collaborative process of allowing consumers to opt in and opt out.">>>MORE