Average commercial building energy costs are based primarily on two components: energy and demand. Energy is recorded kWh consumption. Demand (kW) is based on the maximum level of power demanded by the building.
While project proposals are often based on a reduction in energy costs, in some regions of the country where power production is expensive, the demand component can be greater than the cost of energy. If the power provider imposes a ratchet clause in its service contract, the monthly demand charge may be tied to annual peak demand, creating an ongoing high expense.
Lighting rebates have become a popular policy for utilities engaged in least-cost resource planning. If it’s cheaper for these utilities to pay a customer to use less energy than it is to build new generating capacity, they’ll do it. However, utilities don’t have a strong financial interest in reducing the entire load profile. Their true interest is to shave peak demand so as to ensure electric grid and customer service reliability and reduce their costs.
As a result, utilities began to develop demand response programs. And because demand charges are so expensive, many owners have engaged in demand response on their own initiative. The Department of Energy has forecasted that energy efficiency and demand response programs—but mostly demand response—will reduce peak power demand by 5% over the next decade.
The Federal Energy Regulatory Commission defines demand response as “changes in electric usage by end-use customers from their normal consumption patterns in response to changes in the price of electricity over time, or to incentive payments designed to induce lower electricity use at times of high wholesale market prices or when system reliability is jeopardized.”
This gives us two types of demand response. Economic demand response involves a building reducing power during times when the cost of power is high. Emergency demand response involves a building agreeing to reduce power upon utility request when the grid is stressed or when wholesale electric prices are extraordinary high.
Adoption of demand response is expected to accelerate in coming years. Demand for electric power has increased every year except for four years since 1940 in the United States, but new generating capacity, especially peak power, is becoming increasingly expensive to produce. As a result, the gears of policy and market transformation are beginning to favor it, including energy and green building codes, LEED and utility incentives. For example, demand response is now covered by California’s Title 24 energy code, green building standards such as ASHRAE 189.1 and the International Green Construction Code (IgCC), and LEED 4.0. Utilities now offer demand response incentives in most states, with up to $300/kW available to cover installation and with an annual payment of $20-40/kW, depending on the utility.
Meanwhile, the advent of advanced meter infrastructure (AMI), or the so-called Smart Grid, will facilitate demand response in a variety of ways. Currently adoption of the Smart Grid is estimated at about 30% nationally and 90+% in California. This infrastructure allows both producers and consumers of electricity to generate real-time usage data and communicate about how and when to produce and consume energy. It also permits implementation of time-based pricing in which utility customers may see significantly higher costs during demand peaks, notably late mornings and early to mid-afternoons on summer days.
There are many ways to reduce power in a building, with a role for lighting and with lighting controls being key to implementation. As the biggest consumer of electric power in commercial buildings—an average 38% of site electricity—lighting is a desirable target for demand response. This can be achieved by using lighting more efficiently or turning it OFF or down.
This gives us active and passive lighting demand response. Passive lighting demand response involves saving energy to reduce energy costs, with demand reduction realized as a beneficial byproduct. This includes anything that increases the base efficiency of the lighting system, from installation of more-efficient lamps, ballasts and luminaires to lighting controls such as occupancy sensors. As lighting controls such as occupancy sensors and daylight harvesting controls often reduce energy consumption during peak demand periods, they are especially beneficial. Optimizing efficiency is the first critical step in demand response. If the control system is centralized, it can serve as a platform for active lighting demand response.
Active lighting demand response involves acting upon the capability to specifically reduce load during peak demand periods or periods of high pricing (economic demand response) or upon utility request during times of grid stress (emergency demand response). This capability requires the ability to measure lighting load at any point in time, accept a utility signal to start, stop and measure a load shed event; and temporarily reduce lighting load by a significant amount while respecting occupant lighting needs. While it’s possible to manually shut off non-critical loads, automating the process and incorporating dimming can be more reliable and less disruptive.
A demand response program begins by evaluating each space and determining whether the lights can be turned OFF or turned down. In spaces with regular occupancy, this may require dimming with a smooth fade between light levels to avoid disruption. Step dimming can be effective in transition and utility spaces such as corridors and lavatories.
If lighting can be dimmed, a big question is how much can be tolerated before occupants notice the change and find it objectionable. A National Research Council-Institute for Research in Construction (Canada) field study found that lighting loads could be reduced 14-23% without significant numbers of occupants noticing. The Institute subsequently developed recommendations for emergency demand response application in office buildings:
Stage 1: This type of demand response involves dimming by amounts that are not noticed by the large majority of occupants. Dimming can occur rapidly, over as little as 10 seconds, by 20% with no daylight, 40% with low prevailing daylight, and 60% with high prevailing daylight. If dimming occurs slowly, over 30 minutes or more, and with no immediate expectation of dimming occurring, levels may drop by 30 percent with no daylight and 60% with high prevailing daylight.
Stage 2: This type of demand response involves more load reduction, with steeper reductions in light levels but still acceptable to a large majority of occupants. Dimming can occur rapidly, over as little as 10 seconds, by 40% with no low daylight and 80% with high prevailing daylight. If dimming occurs slowly, over 30 minutes or more, and with no immediate expectation of dimming occurring, levels may drop by 50% with no daylight and 80% with high prevailing daylight.
The lighting controls implementing the demand response actions must be tied to a central control point that can receive the demand response signal from the utility (emergency demand response) and distribute it across the system. This system should be able to collect, store and display energy information that can be used for measuring demand response as well as other purposes such as analysis, benchmarking, billing, energy savings verification, etc.
In a new building project, demand response can be implemented with minimal cost and effort should dimmable lighting and a digital lighting management system be installed to enact other strategies such as scheduling, occupancy sensing and daylight harvesting. Often, with this type of system, demand response can be implemented as a simple add-on capability. In an existing building, demand response can be problematic unless it is economical to install a control system offering a central point of control along with dimmable lighting. In these projects, load-shedding ballasts can be effective, which provide step dimming based on a powerline load shed signal. In either case, buildings that include a building automation system may have the front-end control in place and allow integration with the lighting control system.
Prevailing trends point to increasing demand for demand response. For lighting to participate, it should be rendered as efficient as possible and controlled.
The concept of lighting control and demand response can also be extended to outdoor lighting and street lighting. In July of 2013, I gave a presentation at the National Town Meeting on Demand Response + Smart Grid in Washington, D.C. This gathering has historically focused on utility-based demand response approaches, but I presented a means to use the aggregated control of a city’s streetlights to reduce a large portion of a municipality’s load when the streetlight operation coincided with peak demand. This occurs more commonly in colder climates where evening peak demand occurs when streetlights begin coming on. The concept is straightforward, given the new outdoor lighting system control schemes and the ability of LED lights to be easily dimmed. What is not so straightforward is the integration of AMI and smart grid systems and streetlight control systems for demand response applications. As you clearly demonstrated the opportunity in-building, the outdoor lighting opportunity is actually more compelling. The primary reason is that typically the streetlights are all under the control of either the utility or the city. Of course, aggregating the retail outdoor lighting would take much coordination, as it would for building lighting, since all retail owners would have to receive market-driven cost inputs to influence their simultaneous control of the lights in aggregate. Good article. I think you will see adoption of outdoor lighting controls and integration with demand response programs accelerate.