From megawatts to negawatts

As interest continues to grow in Demand Side Response (DSR), more and more businesses are exploring the opportunities that exist in turning down their power demand at peak times. One business that is helping its clients take maximum advantage is Incentive Carbon Management. Board Director Bill Pollard explains.

At Incentive Carbon Management (ICM) we provide energy and carbon reduction solutions to both SMEs and larger businesses. We’re part of one of the UK’s leading independent facilities management groups, Incentive FM Group.

The services we provide help our customers save a minimum of 20 per cent from their carbon and energy costs, while ensuring they meet current legislation and their corporate social responsibility (CSR) objectives.

Understanding our markets

We operate in an extremely complex market and it’s important to us that we become an integral part of our customers’ energy management teams. It’s our responsibility to bring innovation and new ideas to the table. We’ve found that most of our customers have some level of knowledge and awareness of DSR, but they’re uncertain how best to implement it.

Interestingly, when discussing it with customers, more and more of them want to know about turn-down services, where they receive payment for reducing their power demand temporarily at peak times. I also sense that businesses are becoming greener. They have an appetite to further reduce their carbon footprints, while maximising the financial incentives available to them from the balancing services offered by National Grid.

They want to do more than just switch on their generation assets. But, at the same time, they want to be sure that there’s no risk involved in taking the turn-down route.

How we support them

We’ve recognised the importance of DSR for some time now, both at a national level and for our customers. So we’ve been working with aggregator Pearlstone Energy to educate ourselves and our customers on all the opportunities available.

The services we provide help our customers save a minimum of 20 per cent from their carbon and energy costs, while ensuring they meet current legislation and their corporate social responsibility (CSR) objectives.

As a leading provider of demand management, Pearlstone Energy can design and put in place a range of DSR services for our customers. This allows us to add value to our existing customer relationships, deliver fresh ideas, cost savings and exciting new revenue streams. The solutions we’re able to offer through Pearlstone Energy also enable our clients to participate in DSR in a carbon neutral way – and to view their energy use in real-time across their facilities.

This is thanks to Pearlstone’s partnership with technology experts Honeywell, which means we’re able to use the company’s pioneering Automated Demand Response (ADR) technology. This allows electricity consumers to switch off or turn down non-essential electricity in a reliable, fast, cost-effective and automated way.

It means our customers are helping National Grid balance the network by providing ‘negawatts’ rather than megawatts. By reducing demand, rather than switching on diesel or gas generators, they deliver flexibility in a greener, zero-carbon way.

And the benefits to our clients don’t end there. It requires zero investment from them, reduces their energy consumption and brings in up to £50k/MW a year in payment for providing these services.

New revenue stream

For many of our clients, this creates a new revenue stream. It enables them to sell the energy they don’t need at certain times, for short periods, which they wouldn’t otherwise be able to sell on their own.

Over a five-year contract period, on current estimates, the three clients that we’re working with on this will reduce their energy costs by more than £1,000,000. Our aggregator’s ADR technology will manage their electricity demand, significantly reducing their energy bills and potentially reducing their network demand charges.

Expanding our service

We see DSR as a valuable and positive development for our customers – and also for us as a business. As well as being an important stakeholder for future sustainable development and helping National Grid by providing flexibility, it enables us to tailor the services we offer and secure long-term profitable relationships with our customers.