10 28, 2024

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In June 2024, with summer not even in full swing yet, the Northeast and Midwest United States witnessed  record-setting temperatures as a heat dome settled over a significant portion of the nation, driving temperatures to levels not seen in 30 years. July and August didn’t provide much relief. According to a recent report from Climate Central, June through August turned out to be the hottest season on record, with July 22 as the single hottest day on record.

The intensity and duration of extreme weather events, like the heat waves experienced this summer, are a stark reminder of the potential impacts of climate change. These events put additional strain on our electric grid, which has the never-ending task of balancing supply with growing demand and peak usage. As temperatures soar, energy demand skyrockets from consumers cranking up air conditioning units to stay cool. This surge in demand raises concerns about potential blackouts and grid reliability.

The grid has historically relied on peaking power plants to provide supply during times of need. However, these plants are typically powered by fossil fuels and are expensive to build and maintain. Sustainable ways of using energy are becoming imperative to address the impacts of climate change and ensure energy continuity during extreme events. One way to meet the demand for energy during these critical moments is to be more efficient with existing resources.

The grid is recognizing this need for more sustainable, cost-effective, flexible, and straightforward solutions for addressing peak demand – and that’s where grid flexibility programs like demand response come into play. Instead of increasing supply to meet demand, demand response programs reduce the demand for electricity to meet available supply. These programs incentivize participating organizations to reduce energy consumption when the grid needs it most. Participants receive payments for making strategic, targeted reductions to their electricity consumption while helping ensure grid reliability.

Demand response is becoming increasingly more essential to maintaining grid stability and preventing blackouts during extreme weather events. Let’s look at the role demand response played during the hottest summer season on record.

Summer 2024 demand response performance

Enel North America’s demand response activity from June, July, and August reflects the record heat witnessed during these months. It also tells a clear story of demand response’s role during these months. Demand response events were called almost daily to support many of the nation’s utilities as they faced threats of grid instability.

Let’s start at a high level with a diagram that reflects how our demand response data aligns with the increasing intensity, frequency, and duration of heat waves. In recent years, we’ve seen a surge in demand response events during the summer, historically the most active season for demand response. However, this year saw an unprecedented level of activity, with a significant spike in July in particular:

Enel North America demand response events from 2020 through September 2024

From June 1 through August 31, Enel’s demand response resources were dispatched 411 times to support utilities across the United States and Canada, totaling almost 11,000 MWh provided to the grid for nearly 1,700 hours. This performance is a massive jump from 2023, which saw just 280 dispatches during this period. Here’s the breakdown of each month’s activity:

  • June 2024: 69 events (up from 41 in 2023)
  • July 2024: 224 events (up from 157 in 2023)
  • August 2024: 118 events (up from 82 in 2023)

Almost every region witnessed dispatch activity during these months. However, the largest concentration of dispatches occurred right where the massive heat settled and subsequent heat waves occurred – in the Northeast and Midwest. Utilities like National Grid and Con Edison in the NorthEast and PacifiCorp in the Midwest were among the leaders in the number of dispatches called.

Let’s dive deeper and look at the daily activity from June through August.

Enel North America demand response events – dispatches per day (June – August)

You can see spikes in the line chart demonstrating an increase in events. At a high level, many of these dates correlate to when there were times of extreme heat: for instance, the initial heat dome that rocked the Northeast and Midwest from June 18–23, heatwaves in the West and Northeast during the following month on July 8–9 and July 15–18, and another heat wave at the beginning of August.

Demand response played a critical role in providing grid stability during these months. Here are some specific highlights:

  • New England stands out as a region where demand response played an active role for the entirety of the summer. Demand response was dispatched 4 times on June 18 – these events were short in duration, ranging about an hour in length each time, Demand response was also dispatched 5 times from July 5 – 15, with the events ranging from a half hour in length[WU1] [JD2]  to nearly 5 hours. Another splurge of activity occurred at the start of August, with 5 events taking place on August 1, with events ranging from a few minutes long to over an hour in length, and another 8-minute event on August 2. All in all, 15 demand response events took place in New England from June through August (nearly 17 hours in total), with over 154,000 kWh of energy offered to the grid and over 44,000 kg of CO2 emissions were avoided by not powering up peaker plants.
  • In New York, 3 events stand out. July 15 and 16 each saw a 5-hour event. Not long after, on August 1, another 5-hour event took place. In total, these events delivered nearly 1,400,000 kWh of energy to the grid and helped avoid nearly 400,000 kg CO2 emissions by not firing up peaker plants.
  • In Ontario, a 4-hour event on June 19 and another right away on June 20 delivered more than 1,200,000 kWh of energy support to the grid and helped avoid more than 95,000 kg of CO2 emissions by not firing up peaker plants  – a big win all around.

The grid needs demand response now more than ever

As our summer 2024 data illustrates, demand response resources are emerging as a critical component for maintaining grid reliability. These resources require no new infrastructure, offer cost-effective solutions, and are incredibly flexible, allowing them to be rapidly deployed to meet the grid’s capacity needs. In a time when power systems are under immense pressure from increasing energy consumption and the escalating frequency and intensity of weather events, such resources are becoming indispensable.

The grid is facing mounting challenges and will need to depend more heavily on flexible loads to ensure supply keeps pace with rising demand. These flexible demand-side resources enable grid operators to adjust consumption patterns in real time, helping to smooth peaks in demand and avoid strain on the grid during critical periods.

Managing demand-side resources and flexible loads is a recognized piece of the puzzle to support grid stability. The value of demand response lies in its efficiency and economic sense. It is far more cost-effective for grid operators to pay large energy consumers to temporarily reduce their energy usage rather than investing in constructing expensive, carbon-intensive peaking power plants that they only use during periods of extreme demand. By managing demand-side resources and tapping into flexible loads, grid operators can avoid costly infrastructure expansion, reduce emissions, and strengthen overall grid resilience.

Ultimately, as the grid evolves to meet the growing complexities of modern energy needs, flexible load management will continue to be crucial for ensuring long-term stability, reliability, and sustainability. Demand response is a smart, scalable solution that benefits utilities, consumers, and the environment.

How can your organization get involved?

There’s never been a better time to get involved with demand response to drive efficiencies within your energy infrastructure, support the grid, and get paid for doing so. Many utilities and grid operators have demand response programs and are paying lucratively for organizations like yours to participate to provide flexible load to the grid. Take PJM, for instance, where pricing for the 2025/26 delivery year skyrocketed to record levels, creating the most opportunistic environment for demand response we’ve ever seen.

The beauty of demand response is that it incentivizes more flexible and efficient use of existing assets – and most organizations have flexible elements of their operations that can be part of a demand response curtailment plan. Think about your own facility’s infrastructure. Depending on your operations, some examples of energy reduction strategies include reducing heating and cooling, shutting down or shifting machinery processes, reducing chillers and more in refrigeration processes, and simply reducing non-ancillary controls such as lighting.

Ensuring you’re working with a demand response partner like Enel North America is essential. A partner should understand the challenges that your industry faces, tailor an energy reduction strategy specific to your priorities, be transparent about your earning potential, and demonstrate the experience required to help you maximize opportunity.

As the global leader in demand response, Enel has the resources to help you drive value from demand response programs in the United States and Canada, with personalized energy reduction plans, deep market expertise, and a team by your side every step of the way, with your organization’s best interests at heart.

Contact our team today to learn more about participating in demand response in your region and how you can stake your claim on opportunities to generate revenue and provide essential grid stability using assets you already have.

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