We had quite a few new customers that enrolled into the NYISO demand response (DR) program this year. These same customers have also enrolled in the ConEdison demand response (DR) program. These DR programs pay annual dividends between $10 to $25/kW/month.
ConEdison administers an incentive program under the DMP umbrella called “Demand Response Enablement”. ConEdison pays a one-time incentive between approximately $800 to $1,500/kW for qualified projects.
ConEdison has done a good job of marketing their demand response program. So much of a good job that many Customers seem to think the NYISO DR Program, the ConEd DR Program, and the ConEd DMP Program is one in the same.
We wrote this article to shed some light on the overlapping programs.
|Program Administrator||Program Name||Pays Incentives||Pays Dividends|
|NYISO Day Ahead Demand Response Program||NO||YES|
|ConEdison Demand Response Program (CLRP or DLRP)||NO||YES|
|ConEdison Demand Management Program (DMP)||YES||NO|
The ADR program is under the umbrella of ConEdison’s Demand Management Program (DMP). The ADR Program, is a cash incentive program that helps offset the cost of an automation project in a building. The automation project must include enrollment and active participation in the NYISO demand response program in order to qualify. The ConEdison and NYISO Demand Response Programs do not pay incentives, but rather pay dividends for reliability and performance.
Well the NYISO program is a NY State run program. The NYISO currently pays New York City customers around $12/kW/month from May 1 to October 31 for participating. The NYISO refers to this interval as the “Summer Capability Period”. During the winter intervals, from 11/1 to 4/30, the NYISO refers to this period as the “Winter Capability Period”. The NYISO rates for winter are typically half of the summer rates.
For the year 2018, the NYISO refers to the summer period as the “Summer 2018 Capability Period”. In order to participate, Customers (Participants) must pledge to curtail an amount of kW demand, let’s say 100 kW. Sometimes this curtailable load can be referred to as “negaWatts”. During the capability period, the NYISO and ConEdison pays a monthly dividend for customers to be on “standby” to perform. If the NYISO or ConEdison does not call for an event, the Participant still gets paid for that month.
However, the NYISO will give a 21 hour notice of a planned curtailment event or test. During the event or test, the participants must curtail the pledged amount of kW. The event can last 1 to 6 hours. If the event lasts over 4 hours, the NYISO takes the best 4 out of 6 hours. The NYISO uses the event performance data to establish a performance rating. The performance rating can have an adverse effect on your payments if it is less than 1.0.
What makes life interesting here is that ConEdison has its own demand response program. Like the NYISO, ConEdison will also give a 21 hour notice for a planned event. In some instances, the ConEdison event and the NYISO event occurs at the same time. While on other instances, the events are held at different times on the same day. Yet in other cases, the events are on different days or on overlapping times.
Now let’s talk more about “Automated Demand Response Enablement”. To foster reliable participation in the DR programs, ConEdison administers an Automated Demand Response Enablement (ADR) incentive program. Under this program, ConEdison pays a cash incentive to offset the cost of qualified ADR projects. ADR Projects encompass automating a demand response protocol in a building. The incentive rates for ADR Projects range from $800/kW to around $1,500/kW and changes every year and sometimes every few months. ConEdison requires businesses to enroll in the NYISO Demand Response Program to participate in the ADR Program. The NYISO demand response programs pays about $10/kW/month during the Summer 2018 capability period.
…qualified ADR Enablement projects are equivalent to upgrading from a manual to an automatic transmission in your automobile. Examples include:
For example, A building with 45 floors has packaged water cooled heat pumps on each floor. The building is master-metered and the commercial tenants all have their electric charges included in their lease. The landlord enrolls in a NYISO demand response program. During a curtailment event, he sends the building engineer to shut down AC units or reset temperature set points manually. If the building engineer curtails 100 kW for four hours, the NYISO would pay out around $6,000 for Summer 2018.
The NYISO seems to give 21 hours notice on strategic days like the day before the 4th of July. It is not unusual that the NYISO calls an event, and you guessed it, the building engineer is on vacation. It is not uncommon that the assistant engineer refuses to curtail anything until the chief engineer gets back. Now if the building does not perform during the event, the NYISO will give them a zero performance rating. A zero performance rating may likely result in forfeiture of the $6,000 for the next two years. In some cases the NYISO penalizes the aggregation service provider. Aside from the loss of funds, the NYISO and ConEdison rely on that curtailable electric load. ConEdison and the NYISO use the curtailable load, or negaWatts to support the electric grid during times of stress.
Now enters the “Automated Demand Response Enablement” Program or ADR Program. Under this program, this building will install a building management system (BMS). The new BMS system will automatically curtail the AC equipment. In this case, the chief engineer does not have to run around the building and do it manually. Even better, the assistant chief engineer (or anyone else) now only needs to push a curtailment button on the BMS. The building has now automated their curtailment protocol. A building with an automated curtailment protocol is more reliable to Con Edison and the NYISO. Since the building enrolled in the ADR Enablement program, Con Edison may pay an incentive up to $150,000. The building owner uses the funds to offset the cost of the BMS system. It is important to note that the cash incentive is a one-time payment.
LC Associates has secured millions of dollars for our Customers through NYSERDA and ConEdison to help offset the cost of Building Management Systems. The process to apply for the cash incentives can be found in our article “Secrets of ConEdison’s Incentive Programs Revealed | LC Associates – Energy Services“. LC Associates is also a NYISO and ConEdison demand-response provider. LC Associates is one of the only Firms that can provide an end-to-end DR and ADR incentive solution. If you would like us to secure cash incentives for your building automation project, please give us a call at 212.579.4236. You could also email us at firstname.lastname@example.org.
We have experience securing cash incentives for these types of building automation systems.