Since the 1970s, California's building energy codes and appliance standards (C&S) have transformed how consumers unconsciously use energy in buildings. California's ambitious legislative goals (SB 100) aim to generate 60% of its electricity from renewables by 2030 and 100% of its electricity from carbon-free generation by 2045. Such a high renewable future creates concerns around the stability of the grid.

Increasing the market penetration of demand response (DR)-ready technology through C&S can help mitigate those concerns. With the state's building code (Title 24) cycle beginning anew and drafted legislation pushing for more flexible demand appliances in the state senate, now is the time for DR advocates to push for a suite of new DR-ready technologies to be included in C&S.

Why solar is not enough to reach carbon-free generation goals

Solar alone will be hard pressed to meet electricity demand due to two major challenges:

• An oversupply of generation in the middle of the day leads to curtailment of renewable generation
• Rapid changes in production in the morning and evening, which necessitate non-solar (and often carbon-intense) resources to respond

Unless this increase in renewable generation comes from a diverse suite of carbon-free technologies.

California's Daily Net Demand - Typical Spring Day: 2018

Policy initiatives, like California's Self Generation Incentive Program, and market solutions from technology vendors that offer clean, distributed generation (wind, biomass, small hydroelectric, etc.) are beginning to tackle supply-side issues. However, advanced DR and other demand side management (DSM) strategies will be critical for grid services like frequency/voltage regulation and to fundamentally reshape load profiles. Other benefits of DR programs include the following:

• A more efficient electrical system with lower overall system costs
• A reduced need for new/upgraded transmission infrastructure
• More customer control over electric bills

DR has struggled to find its footing as a valued grid resource.

In 2003, the California Public Utilities Commission (CPUC) set the goal of meeting 5% of the peak energy demand through DR by 2007, shown in D. 03-06-032. As of 2014, the California Energy Commission (CEC) determined that the state was only slightly more than halfway toward meeting this goal. DR had slow market adoption for several reasons, as outlined in the following table.

DR Market Adoption - Historic Barriers

The CPUC recognized the importance of load shifting strategies in D. 17-10-017, creating the Load Shift Working Group to help set guiding technological, market and program principles for the development of DR technologies. The CEC could codify some of these DR principles and include other DR practices (e.g., standardizing communication protocols) to help increase the penetration of the DR technologies in the market.

What are C&S and how do we include DR?

California's Building Energy Efficiency Standards (Title 24 – Part 6) and California's Appliance Efficiency Regulations (Title 20) are two of the CEC's regulatory levers for reducing the energy usage in buildings. Past C&S have helped drive energy efficiency market transformation in California (such as requiring all new construction homes to be nearly zero net energy) and will continue to play an important role.

In the 2019 Title 24 updates, the CEC developed initial requirements for a few technologies and end uses to be DR-ready, as outlined in the following quote from Part 6 of the Building Code updates:

"New or retrofit thermostats, HVAC system, network lighting controller, and building automation systems in the state will be ready for two-way, automated utility to customer energy management … Non-residential buildings will be required to have daylight-matching adjustment, dimming and demand response capabilities."

This initial step will reduce the cost of automated DR and will help streamline communications standards, but there is an opportunity to take Title 24 requirements even further and to bring Title 20 onboard.

Other appliances, building types, and high consumption end uses should be considered for inclusion in future C&S, including the following:

Existing projects successfully demonstrate that these technologies can provide DR services.

At building scale, Lawrence Berkeley National Laboratory (Berkeley Lab) and VaCom Technologies collaborated on a Refrigerated Warehouses DR Strategy Guide to assist refrigerated warehouse owners and operators in implementing DSM strategies.

At the individual appliance level, San Diego Gas & and Electric conducted a scaled field placement project to evaluate, monitor and validate the DR capabilities of connected lighting points to leverage open automated DR for greater participation in DR programs.

When, where and how?

The time to consider including these DR requirements could not be better.

California SB 49, currently under consideration, would require the CEC to "prescribe, by regulation, and periodically update, standards for appliances to facilitate the deployment of flexible demand technologies." With the previous Title 24 updates requiring the first wave of DR-ready building codes and the proposed SB 49 requiring the CEC to codify flexible demand appliances (presumably under Title 20), the state has the momentum to more aggressively include DR in future C&S.

Title 24 updates are broken into three phases: the pre-rulemaking phase, the rulemaking phase and the adoption phase. With the 2019 Title 24 updates going into effect on January 1, 2020 the CEC (which is in phase 1 for the 2022 updates) is accepting comments on the proposed measures (Docket 19-BSTD-03).

Through the Codes and Standards Enhancement (CASE) Initiative, the large California utilities provide recommendations to the CEC to support the Title 24 updates. During the pre-rulemaking stage, CASE teams engage with stakeholders to understand the effect that code updates may have.

Presumably, this would be an opportunity to engage various manufacturers and technology experts to solicit their feedback on integrating DR-ready communication standards.

Unlike Title 24, Title 20 standards are not updated according to a regular cycle. As rulemakings emerge, the CEC encourages stakeholder participation through the submission of data, comments and recommendations.

Stakeholders can also propose a rulemaking or change to current regulations. DR advocates can track existing rulemakings and submit proposals for technologies for inclusion in Title 20.

DR market transformation needs legislative backing

Even with the advances in DR technologies and grid services, DR has and will continue to struggle without legislative-backed market transformation.

Codifying DR-ready technologies will help increase their market penetration, reduce the cost to implement DR programs, and can provide vendors with clear and standardized technology requirements.

A Berkeley Lab study suggests that the potential value for load shifting technologies alone could save California up to $600 million annually as of 2025. With the widespread increase of curtailable resources, the state will be much more suited to tackle its decarbonization goals.