Introducing… Demand Response programs!
Sounds wonky, but they can help you save on your bill and support a greener grid.
At ElectrifyPDX, we’re often asked whether the electrical grid can handle additional demand as more people power their homes with clean electricity. The short answer is Yes! In this post, we’d like to share how electric customers can support the grid when electricity is most in demand—and save (or make!) some money at the same time.
First, a brief introduction to electricity generation in Oregon.
Historically, the electricity market has been similar to the fresh fish market. Both were expensive (or impossible) to store. With virtually no shelf life, market prices are only stable if the product is created just as fast as it’s consumed. If not, prices can fluctuate enormously based on relative timing of supply and demand.
We used to get the bulk of our electricity from coal, hydro, and a little bit of nuclear. These generators are best at cranking out steady amounts of ‘base load’ electricity 24 hours a day. They’re not very good at ramping up or down quickly, although hydro can serve that purpose if need be.
Present day, and looking ahead, wind and solar are the least expensive and most abundant new sources of renewable electricity for the Pacific Northwest. But the times when they make electricity don’t necessarily align with when we use it—and Mother Nature controls the on/off switch, not engineers.
As these new electric generators come online and the old steady ones retire, how do utilities handle predictable (e.g. dinner time every day) or unpredictable (e.g. extreme hot or cold weather events) peaks in electricity demand? They’ve got a few options:
- Build gas-fired ‘peaking plants’, ready to turn on whenever demand temporarily outstrips supply. There are a bunch of these already—and pressure to build more.
- Build industrial-scale electricity storage facilities to store surplus electricity when it’s abundant and cheap, then generate power back to the grid when demand peaks. Examples: A huge collection of batteries in a warehouse, or pumping water up to a reservoir, then releasing it back through turbines when needed. These and other systems are in development in Oregon, and we’ll need more in the future as solar and wind become a larger percentage of our electricity mix.
- Buy electricity from outside our region. But if the weather is extreme there too, that might not be an option (or extremely expensive).
All of these are expensive, with the costs ultimately passing through to customers on their electric bills. Some, particularly gas-fired peaking plants, will run afoul of Oregon’s escalating clean energy mandates.
Luckily, utilities have an additional option: Offer incentives to entice customers to shift their use of electricity from peak times to non-peak times.
As it turns out, this is much less expensive than building more electrical capacity that’s only turned on when demand peaks. Both of our utilities offer options for shifting your energy use. And signing up is easy!
Energy Shifting Options
PGE and Pacific Power sometimes use different names for the same types of programs. Here’s a quick table with links for more information and how to enroll, followed by descriptions of how each program works.
One sentence summary
|On a daily basis, pay less during time periods when electricity is plentiful, and more when it’s in high demand||Time of Day||Time of Use|
|Receive notifications of anticipated peak events by email/text and, if you reduce usage during them, you can earn a rebate on your bill||Peak Time Rebates||Coming soon|
|Get rewarded to let your utility adjust your smart thermostat during peak events a few degrees. If you don’t like the temperature it sets, you can always override||Smart Thermostat Program||Coming soon|
|Earn bill credits by letting PGE access some of your home battery’s capacity during peak events (and it’ll still be just for you if there’s a power outage)||Smart Battery Pilot|
|How to sign up:||Online: Use links above
|Online: Use link above 888-221-7070|
Time of Use Pricing
You might expect electricity rates to vary over the course of the day, following supply and demand. In fact, that’s exactly how it works for large industrial buyers. But most residential customers pay the same amount per kilowatt hour, all day, every day. This provides predictability for the customer, but also means they can’t save money by using electricity when it’s cheaper and more abundant.
The good news is that both PGE and Pacific Power offer time-of-use programs. Anyone can opt in, and you’ll start paying electricity at closer to the real cost of generating it (which changes over the course of the day and even the day of the week). You don’t have to change behavior. But the whole point is to give you the chance to save money by shifting your electricity use to when it’s inexpensive. Some of this can be done automatically, by running appliances (e.g. clothes dryer, dishwasher) or charging things (cars, computers, …) during off-peak hours. Others you can program to make automatic – like your recent ‘smart’ water heaters. To use one more metaphor, time-of-use metering is like driving through highway pinch points at off-hours to reduce and spread out congestion.
To give you an idea of how rates adjust—and how different the true costs of electricity are over the course of a single day—see below for how our local utilities charge for time-of-use metering:
- As of May 2023, Pacific Power’s standard rate is 11.42 cents/kWh. In their “Time of Use” program, they charge 26 cents/kWh from 5-9pm and 8 cents/kWh the rest of the day.
- PGE’s standard Basic Service residential rate is 15.47 cents/kWh. With their “Time of Day” pricing option, on weekdays they charge 11.9 cents/kWh from 7am-5pm, 32.8 cents/kWh from 5-9pm, and 7.43 cents/kWh the rest of the day. Weekends and holidays all day are off-peak at 7.43 cents/kWh. To summarize, Time of Day is cheaper than Basic Service all hours and days except 5-9 p.m. weekdays. As long as you shift your energy use away from 5-9 p.m. weekdays, you can save on your PGE bill.
Peak Time Rebates
PGE recently launched a program called “Peak Time Rebates.” Pacific Power will launch their own version soon. It’s super easy to enroll. And if you do, you’ll earn rebates by shifting your energy away from peak times. This supports more sustainable energy resources, keeps energy more reliable, and helps keep costs lower for the community. The summer season kicks off on June 1st and runs through Sept. 30, so this is the perfect time to sign up.
Here’s how it works: When energy demand and prices are high, you’ll have the option to reduce your energy use during the Peak Time Event, which is typically 3 to 4 hours. Peak time notifications are shared by text and/or email the day before the event. In the summer, they’re most likely to happen in the 3-8 p.m. range. In the winter, you might notice more morning events in the 7-11 a.m. range. Reducing your electricity usage during an event is entirely optional. But if you do, you’ll earn $1 for every kilowatt hour (kWh) you reduce below your baseline during the Peak Time Event.
Smart Thermostat Program
If you have a smart thermostat and a central air conditioning system, ducted heat pump or electric forced air furnace, you can sign up for passive, automatic savings. Once enrolled, your thermostat will automatically adjust a few degrees when energy demand is high—this is called a Peak Time Event. You’ll be notified before an event by email, on your thermostat or your smartphone app, and if you don’t like the temperature it sets, you can always override the change.
If you have a qualifying HVAC system but no smart thermostat, you can buy one through PGE’s Marketplace to get instant rebates. With some models, this brings the price down to just $25!
Things to consider:
- Homes with individual mini-splits won’t work for the Smart Thermostat program, because there’s no central thermostat controlling the temperature of the whole house. If that’s your situation, consider the Peak Time Rebate program.
- You can’t enroll in both Smart Thermostat and Peak Time Rebates. If you qualify for both, just pick the one that better matches your style.
Smart Battery Pilot: Get rewards for your home battery storage (PGE)
If you’re in PGE territory and have a home battery, check out this new program.
PGE’s Smart Battery pilot studies the best ways to connect batteries at customer homes to PGE’s grid. At times of peak energy usage, PGE charges or discharges your battery to either store or provide energy to the grid. Participants determine how much of their battery’s storage capacity to make available to the program. Regardless, your batteries remain fully available to you during a power outage or upon request.
PGE just started looking for people to join the pilot. Eligible battery brands include: Generac, SolarEdge, Sonnen and Tesla. And if you live within specific neighborhoods in North Portland or Hillsboro, you could be eligible for a big rebate from PGE and the Energy Trust of Oregon to install a home battery system.
If you have a home battery and enroll in the pilot, here’s what you can expect:
- You’ll earn bill credits of $1.70 per kWh of energy for each time you participate during a Peak Time Event—those times when energy use is high.
- Your battery will remain fully available to you during a power outage or upon request.
- You may choose how much of your battery’s capacity PGE may access during a Peak Event. If you do not specify an amount, the default storage capacity accessed during events is 9 kWh.
By adding your battery system to the grid, you’d be part of a community that is creating a “virtual power plant”—one that lets PGE store and draw energy when needed. It’s an important step towards a clean energy future and a vital one as utilities add more renewables like wind and solar to the grid.
For example, if the utility’s solar panels or wind turbines are generating more than usual, they can store this extra clean energy in batteries and use it later to power your neighbors’ homes and businesses. That strengthens reliability and makes us better equipped to incorporate more low-cost, renewable energy sources into the grid.
For more details, contact a PGE Battery Storage expert at firstname.lastname@example.org.
EV Smart Charging
If you drive an EV or are thinking of buying one, PGE offers a way for you to save money by charging your EV at home during off-peak times.
PGE offers rebates of up to $5,000 on faster Level 2 EV home chargers or electrical panel replacements plus ongoing bill credits with their Smart Charging program. Learn more.