The Charleston Gazette’s Lori Kersey filed a story yesterday about the Gazette’s participation in PJM Interconnection’s demand response program. The article was titled “Some [C]ommercial [E]lectric [C]ustomers [A]sked to [C]onserve [E]nergy.” The inaccuracy of the title matches the inaccuracy of Ms. Kersey’s reporting in the story itself.
Before I get to the story, I have to commend the Gazette for selling demand response resources. More rate payers need to have this option to keep our electric rates down and to take advantage of the most reliable form of electrical generation – not generating electricity in the first place.
In neighboring Maryland, residential customers have been offered free equipment and demand response credits by power companies for years. There are no demand response programs available to residential customers in WV.
The crux of Ms. Kersey’s story is that
PJM Interconnection, a company that manages the electrical transmission system for 13 states and Washington, D.C., asked customers in AEP’s service area who are part a “demand response” program to reduce their electrical usage in order avoid a potential blackout.
No, Ms. Kersey, avoiding blackouts is not the purpose of PJM’s demand response programs. The purpose of demand response is to reduce demand at times of peak load. This peak demand reduction means that rate payers don’t have to pay for a lot of excess generating capacity that only operates a few hours per year. The purpose of demand response is to reduce the cost of electricity for everyone.
There are lots of ways of avoiding “potential blackouts.” It just happens that demand response is the cheapest and most reliable way to do it.
Ms. Kersey also failed to point out that PJM’s demand response programs played a major role in defeating the foolish and expensive PATH transmission project by eliminating the claimed need to shift power around PJM’s system to meet peak loads.
Update: I apparently did not make the main point of my post clear the first time around. A couple of people have asked me for clarification, including Frank Young in the Comments section of this post. I provided some details in my response to Frank, but I wanted to provide a simple explanation here, in the body of the post.
The purpose of everything PJM Interconnection does is directed at preventing blackouts. To say that invoking demand response resources is designed to prevent blackouts is true, but doesn’t identify at all the significance of demand response. Everything PJM Interconnection’s grid managers is designed to prevent “potential blackouts.”
Demand response tools have been developed because they are the least expensive, most reliable way of reducing peak demand and avoiding the conditions that create cascading failures. The use of demand resources has exploded in PJM’s system over the last five years and has eliminated the need to build too much power plant and transmission, which has saved rate payers hundreds of millions of dollars. That is the real story, not that a particular demand response order from PJM “avoided a potential blackout” week.
PJM grid managers, who do an extremely difficult job very, very well, take thousands of actions every week that prevent blackouts, so there was nothing particularly special with invoking the Charleston Gazette’s demand response contract last week. Without any information about the larger context, the Gazette’s story was a dog bites man story masquerading as a man bites dog story.