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US Demand Response to Expand 8.4% Annually through 2018

June 17, 2015 By Josh Kessler

A June 8 report posted on WhaTech predicted that the US demand response (DR) industry will grow at 8.4 percent per year from 2015 to 2018. First implemented in the US in the 1970s, these programs provide payments to customers who reduce their energy consumption during periods of peak energy use. A broader report on the Global Demand Response (DR) Market 2015-2018 forecasts that worldwide DR will expand at a combined annual growth rate of 16.6 percent per year through 2018. The analysis is based on a series of interviews with industry experts, combined with quantitative market data.

Most relevant to customers, the report lists key DR vendors, including: ABB, Honeywell, Johnson Controls, Schneider Electric, Enernoc, GE, Comverge and Eaton.

PJM to See Record 15,000 MW of DR in 2015

Intelligent Utility reports that DR will peak at more than 15,000 MW this year in the PJM Interconnection region, which covers 13 states in the Mid-Atlantic and Midwest as well as the District of Columbia. Tight generation capacity “reserve margins” will mean higher prices for DR resources over the course of the next year. In mid-2016, efficient new gas-fired plants will come online, and new capacity market rules will take effect, driving down prices for DR and other capacity resources. The Federal Energy Regulatory Commission has just approved PJM’s capacity performance proposal, according to Utility Dive.

Perhaps most importantly, a large pipeline that is currently under construction will be completed, bringing natural gas from the Marcellus shale formation to the power plants that need it. This will enable regional power plants to run on cheap natural gas, whereas recent winters have forced the region to shift to more expensive oil-based generation and procure power from more far-away power plants.

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