Demand response specialist EnerNoc announced it has entered into a contract to deliver 250 megwatts of power to four utilities in Maryland: Allegheny Power, Baltimore Gas and Electric, Delmarva Power and Light Company, and Potomac Electric Power Company.
Under these deals, EnerNoc agrees to get large industrial users and those with extensive real estate holdings to curb power demand, particularly during peak periods. To a utility, these negawatts reduce strain on the grid and obviate the need to build gas- or coal-fired peaker plants that can be flipped onto accommodate your air conditioning needs on a hot summer day (see EnerNoc Expanding Into Carbon Management Energy Services).
Demand response remains one of the stronger markets in greentech these days, partly because it can provide a quick payoff for the participants and partly because Americans waste energy on a profligate level in the U.S.: Some estimate that of the 100 quads of energy consumed in the U.S. a year, 55 to 60 quads get wasted. Thirty-nine percent of the energy in the U.S. is consumed in building operations and experts regularly complain that lights remain on and air conditioners crank away when no one is around. While completely fixing these problems would require retrofits, demand response can take some of the edge off now.
Policy is also helping boost demand. Connecticut has declared that installing energy efficiency technologies can count toward green energy credits.
Other companies in this market include Comverge, which targets demand response systems at consumers and businesses. And then there's Advanced Telemetry, which is experimenting with demand response at fast food restaurants (see Harvesting Megawatts From McDonald's).
The Maryland deal means that the company, which signed seven utility contracts in the first quarter, manages close to 2.5 gigawatts of capacity.
EnerNoc now, however, has to find large customers to give them the power. That shouldn't be too tough. A typical industrial customer for EnerNoc can spare 333 kilowatts, co-founder David Brewster told us late last year.
These industrial customers benefit from lower power bills and they get a fee for selling the power it doesn't use. The sales cycle for an industrial customer takes about 60 days, Brewster said.