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How Demand Response Programs Save You Energy and Money

October 6, 2022
demand response programs save energy and money

Energy supply is limited to what utilities generate during peak hours. Your water heater is the second single biggest user of electricity in your home, making up 13.6% of residential energy usage by appliance. It’s second only to space heating and cooling, which uses the most energy at 42%. Both are major opportunities to change residential energy usage.

Changing energy usage is especially urgent in California, where energy grids are becoming more vulnerable to climate-related disasters like heat waves, storms and wildfires. With temperatures reaching three digits across the state, demand on the energy grid gets higher. Straining energy supply leads to blackouts if demand is too high. California is walking the fine line between brief, contained power outages or widespread blackouts.

What if there’s a way homeowners can help manage electricity usage while also saving money? The answer is demand response. By participating in demand response programs, homeowners can make a big impact by shifting water heater energy use.

Defining Demand Response Programs

Demand response programs are becoming more common as a means for utilities to reduce energy demand during peak usage hours. They may involve reducing energy usage and shifting electricity usage to low demand, off-peak periods. This enables utilities to supply continuous and reliable power for homes and buildings.

Importance and Benefits of Demand Response Programs

A demand response program provides benefits in several ways. Homeowners are able to avoid common power supply disruptions like emergency response blackouts or scheduled brownouts. These programs also help minimize electricity rate increases and environmental impact by delaying the construction of new power plants. These programs are useful because they lower the need to expand the grid to meet electricity demand.

High Household Satisfaction

Participating in a demand response program is rarely at an inconvenience to the household. Few households experience a hot water shortage due to load and demand management events. Utilities will only allow a demand response event if the grid demand is high. During a demand response event, the water heater will store hot water, but will not create more hot water. The water heater’s efficient design allows tank water to remain hot even when not in use.

Demand response also isn’t fixed. If there is a higher demand for hot water such as additional guests in the house, the user can override the demand response event and allow the normal heating cycle to occur. Events also rarely happen on weekends and holidays. Homeowners can rest assured knowing that 95% of demand response program participants are satisfied with the experience. All around, participating in demand response programs helps keep energy prices affordable, saves natural resources and requires very little compromise.

ecoport cta-2045How Rheem Supports Demand Response Programs

Water heaters that are demand response ready include the Rheem® ProTerra® Hybrid Electric Heat Pump and the ProTerra® Plug-in Heat Pump with Hydroboost™, along with the Prestige® Smart Electric, Classic® Smart Electric, and Classic® Electric. For demand response ready water heaters, utilities control the water heater by installing a communication module in the water heater’s EcoPort (CTA-2045 port). Some utilities may also control the water heater through traditional Wi-Fi, cellular or even offline time-of-use scheduling. This allows the utility to adjust the water heater’s electricity usage, reduce energy demand during peak periods and reduce CO2 emissions.

save moneyHow Demand Response Programs Save Money

Demand response programs are designed to manage energy load, but they’re also designed to reduce household energy bills. They shift energy to a lower demand time, which means cheaper electricity rates. Plus, homeowners can take advantage of utility demand response program incentives and rebates.

You can be proactive in participating in demand response programs to have greater awareness of your household energy usage. To find these opportunities, contact your utility to see if they offer demand response and energy cost saving programs. In California, there are various options available like the SGIP (Self-Generation Incentive Program), the Power Saver Rewards program and the Summer Discount Plan.

Stay Tuned

Demand response programs are more crucial now that there are more pressures on energy supply. Stay tuned to be the first to know about them.

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