PG&E Corporate Responsibility and Sustainability Report 2018

PG&E Chapter 11 Update

Demand Response

PG&E’s demand response programs enable customers to reduce energy use during periods of peak demand, providing a way for them to save or even earn money by adjusting their usage. By giving customers incentives to curtail usage, demand response programs provide grid stability, lower costs for customers and achieve greenhouse gas emissions reductions.

Our Approach

PG&E’s demand response options are supported by SmartMeter™ technology, which helps customers better understand their energy usage and lower their energy costs. Our programs also help avoid the need for additional power plants that would only be called on for short periods throughout the year on days when demand is highest.

More than 200,000 residential customers participate in the programs we offer, along with more than 150,000 larger commercial and industrial customers. Programs for homes and businesses include:

Program Description
SmartRate Gives residential customers a discounted rate throughout the summer, with the exception of nine to 15 “SmartDays,” when their rates are higher because demand for electricity is high. In 2018, 115,000 customers participated in SmartRate and provided an average load reduction of nearly 21 megawatts (MW) per event day.
SmartAC Allows PG&E to send a signal to a PG&E-provided device on a customer’s air conditioner, cycling the air conditioner to use less energy. The program is offered May through October. In 2018, 112,000 participants provided about 61 MW of potential load reduction that was available if needed.
SmartRate + SmartAC Automatically cycles the air conditioning systems of participating customers during SmartDay events by controlling their SmartAC devices, helping customers avoid higher SmartDay prices. Approximately 21,000 customers were enrolled in both SmartRate and SmartAC in 2018.
Peak Day Pricing Provides non-residential customers with discounted rates from May through October. In exchange, prices are higher for energy used during designated peak “Event Days” (9 to 15 per year) and times, to discourage energy usage on those days. In 2018, more than 150,000 customers participated in Peak Day Pricing.
Capacity Bidding Program Works with third-party demand response companies that aggregate customers. These aggregators—and, by extension, the customers in their portfolios—act as virtual power plants and receive payments from PG&E in exchange for reducing load on peak usage days.
Base Interruptible Program Enables participating customers—typically large customers—to receive financial incentives in exchange for their commitment to reduce energy usage during emergencies in response to requests from PG&E, which helps ensure grid reliability.
Automated Demand Response (AutoDR) Provides rebates for residential demand-reducing smart thermostats and provides funding for demand-reducing equipment for non-residential customers where the equipment is capable of receiving a signal from PG&E to initiate a series of automatic, customer-defined and pre-authorized actions during demand response events.

2018 Milestones

In 2018, we leveraged our programs on numerous occasions to reduce demand and ensure reliable electric service for customers.

This includes a new option for our Capacity Bidding Program that ties demand response events directly to the price of energy in California’s wholesale energy market. Each aggregator in the program determines the price at which they are willing to have their customers participate in a demand response event, enabling aggregators to tailor offerings to their customers while also encouraging demand response to be used in a manner that can help alleviate high prices. This option attracted new aggregators and increased the load reduction potential of the program by 50 percent compared to 2017.

In addition, we completed systems integration to enable two-way communicating load control switches over the SmartMeter network. This approach ensures greater reliability in delivering on the energy forecast into the market and can provide near real-time visibility at the individual customer level.

Measuring Progress

Through our demand response programs, PG&E and our customers had the ability to provide up to 500 MW of load reduction in 2018—about the capacity of a large conventional power plant.