Small Business Demand Response with Communicating Thermostats: SMUD's Summer Solutions Research Pilot

This report documents a field study of 78 small commercial customers in the Sacramento Municipal Utility District service territory who volunteered for an integrated energy-efficiency/ demand-response (EE-DR) program in the summer of 2008. The original objective for the pilot was to provide a better understanding of demand response issues in the small commercial sector. Early findings justified a focus on offering small businesses (1) help with the energy efficiency of their buildings in exchange for occasional load shed, and (2) a portfolio of options to meet the needs of a diverse customer sector. To meet these expressed needs, the research pilot provided on-site energy efficiency advice and offered participants several program options, including the choice of either a dynamic rate or monthly payment for air-conditioning setpoint control.

An analysis of hourly load data indicates that the offices and retail stores in our sample provided significant demand response, while the restaurants did not. Thermostat data provides further evidence that restaurants attempted to precool and reduce AC service during event hours, but were unable to because their air-conditioning units were undersized. On a 100°F reference day, load impacts of all participants during events averaged 14%, while load impacts of office and retail buildings (excluding restaurants) reached 20%. Overall, pilot participants including restaurants had 2007-2008 summer energy savings of 20% and bill savings of 30%. About 80% of participants said that the program met or surpassed their expectations, and three-quarters said they would probably or definitely participate again without the $120 participation incentive.

These results provide evidence that energy efficiency programs, dynamic rates and load control programs can be used concurrently and effectively in the small business sector, and that communicating thermostats are a reliable tool for providing air-conditioning load shed and enhancing the ability of customers on dynamic rates to respond to intermittent price events.