As extreme weather events increase in number and severity, utilities and their customers are seeing a related rise in power outages. A recent study from Climate Central found that the number of weather-related power outages from 2011-2021 increased by 78% nationwide compared to the preceding decade.
This climate instability, combined with growing energy demand, means utilities must adopt new strategies for grid resiliency, such as continuing to innovate demand response (DR) programs and giving customers greater choice and flexibility around if, how and when they participate in energy programs. As smart grids and energy-efficient devices proliferate, utilities can increasingly leverage these new strategies to better manage their grids in the face of unpredictable conditions.
But how can utilities reinvent the DR customer experience to ensure these programs are effective?
“Utilities need predictability and precision, but customers don’t always think and act the way utilities expect,” says Kari Binley, Senior Manager, Energy Partnerships, with ecobee, a leading smart thermostat producer. Together with San Diego Gas & Electric (SDG&E), ecobee conducted an innovative grid resiliency pilot project in late 2022 to explore ways of improving grid stability during an energy shortage. Part of the pilot’s goal was to expand the available pool of resources for SDG&E during a DR event while completely redesigning how customers participate in order to increase the reliability of that pool. ecobee first tested this participation model in 2020, and after seeing initial success, brought it to market last summer during the California heat wave.
How the program worked
In September 2022, California called an EEA1 Alert, meaning the grid was at capacity and customers needed to conserve energy. In coordination with SDG&E, ecobee dispatched an emergency event to their pilot group of customers on the day of the event. These customers — who were not part of SDG&E’s own smart thermostat DR program — received a notification in the ecobee mobile app before the event took place confirming whether they would like to participate in an energy-savings event. If they responded yes, their thermostat was automatically adjusted to conserve energy. Customers also received mobile notifications during the event so that they could stay informed, and after the event with a summary of their impact.
When a flex alert is called, utilities and system operators typically urge customers who are not enrolled in a DR program to lower their energy consumption manually. This pilot was unique because it automated the steps for these customers to make participation easier. This program was the first of its kind to expand customer participation beyond those who have previously enrolled in the DR program, which increased the volume of load shifted and helped further stabilize the grid.
SDG&E ran a traditional DR event at the same time, and the load shifting in the ecobee pilot program mirrored that of the typical DR program, reinforcing the predictability that the utility could expect.
Resource reliability was a key benefit of this event, and the pilot helped identify three crucial components to building that reliability into DR programs:
1. Empower customers with options for participation
Giving customers in the pilot group the chance to confirm their participation in the ecobee app increased their engagement during the EEA1 Alert. As a result, SDG&E had reliable data on how many customers were participating in the event. “We want to give customers opportunities to participate or not participate based on their needs at the time,” Binley explains. Providing the space for customers to decide if they wanted the temperature adjusted automatically during the energy shortage gave SDG&E verifiable information on overall energy consumption heading into the event. The fact that the load shifted in the ecobee pilot event matched that of the traditional DR event proved that customer engagement drives reliability.
2. Be flexible on purpose
Traditional DR enrollment models ask customers to sign up for a utility smart thermostat DR program in return for a rebate or other financial incentive. Over time, customers who sign up to participate may not recall the program details or the ramifications when an event happens, creating a static pool of participants. And it’s a limited pool — typically, only 20-40% of eligible smart thermostat customers enroll in these DR programs. By partnering with smart device manufacturers like ecobee to offer customers flexibility around how they would like to participate, utilities can access a larger pool of customers to respond when they need it most.
This approach can be more cost effective as well. Some customers may not want to participate in their utility’s DR program on an ongoing basis, regardless of whether they are offered a financial incentive. However, they may be willing to take action when the grid is most vulnerable. “Customers may want to help with electricity reliability but they don’t necessarily know how,” says Binley. “Giving them choice and agency without having to commit them to specific program rules, and without the expectation of financial incentives from their electricity provider, is a win-win for customers and utilities.”
3. Repeat yourself
Providing multiple touchpoints to customers around an energy-saving event is essential. Because states such as California are already communicating about grid emergencies via text, reiterating the message via in-app notifications amplifies customer awareness and reaches customers where they are. Sending more than one message gave customers multiple opportunities to engage, resulting in a stable, known quantity of resources during the event and no adverse reactions or pushback on customer service. These positive customer experiences can engender continued participation and a larger and verifiable resource pool for greater energy efficiency.
Working together for better DR
Working with cutting-edge technology and building trust with customers are the pathways to better reliability. Smart devices and their intuitive communications ensure an engaged, prepared customer base and therefore a more reliable pool of resources during the energy-saving event. “The pilot was an expansion of a traditional DR program achieved through our collaboration with SDG&E,” Binley said. “It shows utilities can reap the benefits of reduced energy usage and automated solutions with the right partners and tools in place.”
Learn more about partnering with ecobee to improve the effectiveness of your DR programs.
