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Members of the New Jersey Conference of Mayors have
a great opportunity to develop a new source of
revenue. What municipality and Mayor wouldn’t a
benefit like that in a time of economic hardship
with economic growth and commercial and residential
development at their lowest in recent memory?
There is a program called “Demand Response” that
pays the municipality (and the school district) for
not using electricity. The way that “Demand
Response” works is by helping power grid operators,
as you may recall the massive gray/black outs that
affected the country and parts of
New Jersey
in August of 2003 due to their inability to handle
sudden spikes, manage spikes in usage particularly
during hot summer periods. “Demand Response” is
designed to curtail the use of electricity instead
of boosting generation and overwhelming the capacity
of the grid.
In
other words, if municipalities (and the school
district) are willing to offer to reduce their
consumption of electricity during certain times, you
will be paid the market value of the electricity you
don’t consume under an agreement you make with the
power grid providers. The program enables the
municipality to receive a revenue stream for
reducing electricity consumption, through a planned
program, when either the wholesale prices are high
or the reliability of the electric grid is in
jeopardy.
From a state perspective this is extremely
important. Electricity providers in New Jersey are
having serious infrastructure problems, which raises
questions of reliability, at the same time rates are
rising rapidly to our residents.
A
benefit of participation in the “Demand Response”
program for municipalities is it can actually
empower you to negotiate more attractive retail
rates with competitive electricity suppliers.
Further, participation helps municipalities as end
users to control peak demand for electricity.
The program is a load reduction on the grid in
response to a signal either the municipality
responds to a market signal, the advent of higher
prices and the municipality responds by reducing its
demand in order to be paid the market price for the
load reduction, or the municipality responds to the
grid operator’s call signal and gets paid either a
premium payment for an emergency call or a receive a
recurring payment for being on call.
There are a variety of methods that the municipality
can use to respond to the call by having a backup
generation system to backup generation to displace
demand on the grid, the synchronization of building
automation systems to reduce heating or cooling
loads. In other words, the above and a variety of
other strategies could make your facilities into
highly efficient power plants.
As
a municipal participant you will assist New Jersey
in helping respond to; rapid increase in price, an
emergency event called by the grid operator to
maintain grid reliability or contractual agreed upon
intervals. New Jersey municipalities would act as a
resource for the grid operator to assist alleviating
peak transmission congestion, peak demand or to
offset the loss of a major generating unit, which
happen in 2003.
The municipality (and the school district) can
receive as much as $100,000 per megawatt of load
reduction per year and you are paid whether or not
an emergency event is called. You are paid for being
a standby source.
If
we have peaked your interest in the possibility of
producing a source of income for your municipality
and contributing to energy efficiency than you might
want to call Gary Bell at 908-770-6812 or email him
at emulsiontech@comcast.net and he will help guide
you through the process. |
