How NV Energy integrated demand response and energy efficiency at scale
NV Energy's mPowered program – the first large scale integrated efficiency and demand response program – is cutting electric use and peak load with high customer satisfaction levels, according to Michael Brown, NV Energy demand response manager.
Las Vegas-based NV Energy's main goal is to deliver utility-branded home energy management services to increase customer engagement and satisfaction while making as much use as possibly of the company's recent smart meter deployment, Brown said during a Peak Load Management Alliance presentation February 6.
So far, the results look good. Using smart thermostats and EcoFactor's cloud-based efficiency and demand response service, participating households are cutting their air conditioning by 12% and whole-house electric use by about 6% a year, according to Brown.
The same households are reducing their load by 3 kW to 3.5 kW in the first hour of demand response events last year, Brown said, noting that there is a slight drop-off in demand reduction during the second hour of the two-hour events.
NV Energy allows its customers to override the increase in temperature settings during demand response events, Brown said. Since 2008, the override rates have held steady at around 11% in the first hour and 7% in the second hour, he said.
NV Energy seeks combined savings
Since 2006, NV Energy has been installing two-way thermostats in customer buildings, providing about 150 MW in demand response capacity, according to Brown. The utility company wanted its demand response efforts to also spur energy savings, but that wasn't happening, Brown said.
In response, NV Energy starting testing EcoFactor’s system in 2010, according to Brown. In late 2012, NV Energy launched a full program using EcoFactor to coincide with the end of of a smart meter rollout, he said.
EcoFactor's system, which can be used on any smart thermostat, monitors changes in temperature settings, the performance of air conditioners and weather conditions, according to John Steinberg, EcoFactor executive vice president for business development.
Essentially, EcoFactor, a startup based in Redwood City, California, can create a thermal profile for every home. This allows EcoFactor to automatically make small temperature adjustments without making the residents uncomfortable and “without asking them to become facility managers in their own home,” Steinberg said.
Currently, NV Energy has 14,000 customers with 23,000 thermostats enrolled in the mPowered program, representing about 47 MW of demand response capacity, Brown said. NV Energy aims to double the amount of capacity in two years.
Last summer, NV Energy had 28 demand response events in southern Nevada, with a stretch of eight days of events in a row. Few customers decided to leave the program after the eight-day stretch, Brown said.
High customer approval, but a lack of understanding
About 85% of NV Energy's customers enrolled in mPowered have positive attitudes towards the program, Brown said. However, NV Energy's customers don't seem to fully understand what energy savings means for them.
“That's a big worry for us,” Brown said. “Part of the big premise for this program was that instead of asking customers to participate in demand response programs, which quite frankly they're not all that interested in. We're trying to deliver them what they are interested in, which is energy and money savings."
NV Energy plans to ramp up its efforts to make sure its customers understand mPowered and how much they're saving, Brown said.
NV Energy is trying to use EcoFactor as a way to provide new services to its customers, like alerting homeowners to possible air conditioning repairs or energy efficiency upgrades, Brown said.
Behavior change vs. automation
NV Energy thinks demand response and efficiency programs can blend efforts to change customer behavior with automated systems. “They have to come hand in hand,” Brown said. “There's room for both.”
EcoFactor's Steinberg doesn't think behavior change alone makes sense. “It is wrong to say you have to have behavior modification,” he said. “One of the goals should be to take things that aren't inherently fascinating [like cutting electric use] and let technology help us with them.”
The $3.2 billion question
EcoFactor believes Google's decision to buy Nest for $3.2 billion is good for the market. “The Google acquisition is overall actually very good for the space and for us,” Steinberg said. The deal has given “a huge vote of confidence to the home automation opportunity and the application of big data techniques to these kinds of situations.”
Further, “Nest is raising awareness about using learning algorithms to manage [air conditioning] systems,” Steinberg said. “We think a lot of value comes from being able to process large amounts of data.”
The Nest deal isn't the first time Google tried to get into the home energy management space, Steinberg noted, pointing to its failed PowerMeter application. “It didn't make sense to us, handing over data to consumers and asking them to take action,” he said.
EcoFactor is different from Nest in at least a couple areas, according to Steinberg.
First, EcoFactor is happy to work with any thermostat. “We're really just the software layer,” he said Second, EcoFactor lets its utility customer, like NV Energy, brand its own program. This helps the utility drive customer satisfaction in a time when other service providers are trying to break into the home energy space as well.