Illinois pilot aims to prove demand response can be year-round resource in PJM market

Dive Brief:

Several energy and envionmental groups are teaming up with PJM Interconnection on a demand response pilot in Chicago, which will bundle intermittent resources and the responsive capacity of several buildings, Smart Grid News reports.
Cook County, Illinois, which includes Chicago, has pledged to evaluate up to 45 of its government buildings for their ability to participate in the project.
The plan is to show that demand response can be used as a year-round resource, allowing it to bid into PJM's markets that now require a new and more stringent set of performance standards.

Dive Insight:

PJM's new performance standards, developed after large amounts of generation was unavailable during the 2013-14 polar vortex, have been vexing demand response advocates because the grid operator only allowed the resource to compete during the summer. Under the new standards, a capacity resource has to be available at any time, meaning demand response was effectively shut out.

But a group led by the Environmental Defense Fund (EDF) is seeking to change that, and has developed a pilot to show how combining resources can allow demand response to continue to compete with other sources of power in the market.

EDF, along with The Accelerate Group, Citizens Utility Board (CUB) and PJM Interconnection, want to develop new methods of utilizing demand response. The pilot, called the Combined Capacity Asset Performance Project, will bundle variable, renewable energy with the demand response potential of several Chicago buildings that can work together in real-time during emergency events to meet electricity commitments.

“The project offers an inventive way to preserve and grow this valuable resource in the PJM market,” said The Accelerate Group President Andrew Barbeau in a statement. “The collaboration will serve as a strategic model for buildings, which will be able to combine their demand response potential to enter the market where they wouldn’t be able to participate on their own.”

In recent years, EDF and CUB have been working closely with commercial offices and residential buildings in Chicago to help them save energy and costs. “Facing our energy challenges requires Illinois to seek innovative ways to reduce electricity demand,” said CUB Executive Director David Kolata.

Cook County will be a lead participant in the project, and has committed to evaluate up to 45 of its government buildings for their ability to participate in the capacity performance market year-round.