Demand Response Overview

What is Demand Response?

A storm, heat wave or even the occasional repair/maintenance on a power plant are a few of the peak energy demand scenarios that increase congestion on the power grid and have the potential to affect California's supply and demand for electricity. Even the lack of natural gas supplies (since natural gas is used to fuel electricity supplies) could lead to congestion on the grid. It is during these times that a Demand Response Event Day is called because energy conservation is needed from customers in our territory. On Event Days most of SDG&E's demand response programs offer financial incentives to customers who voluntarily reduce their electricity use to help ensure public safety and stabilize the grid. 

Is it necessary?

Demand response is necessary, as it is economically and environmentally conscious. It provides alternative solutions (programs that offer a financial incentive to those customers willing to reduce their electricity use) instead of building more power plants to satisfy electricity needs.  

What programs are available to those customers willing to participate?

Program/
Program Season
Reward Risk Notification Lead Time Number of events that can be called Additional Information
Base Interruptible Program (BIP) / Year Round May 1 - Oct 31 = $12/kW monthly bill credit
Nov 1 - April 30 = $2/kW monthly bill credit

Receive a load shed test at no cost. 
Penalized for excess energy use
May 1 - October 31= $7.80/kWh
Nov 1 - April 30= $1.20/kWh 
Day of event 30 minute notification Year: 120 hours max
Month: 10 events max

Day: 4 hours
- Qualifying businesses are tested for how much energy they can reduce and receive a load reduction plan at no cost. They can receive an incentive if they have the ability to commit a minimum reduction of 100kW and at least 15% of their monthly average peak demand.

sdge.com/BIP
Capacity Bidding Program (CBP) / May - October

Day Ahead
Incentives provided to customers who reduce their energy use when requested the day ahead by SDG&E.   Failure to reduce energy may result in a penalty.  Day ahead of event before 3pm Year: No annual max
Month:  44 hours
Week: No limit
Day: 1 event

- Businesses receive higher incentives if they can reduce their energy use to a set amount, during a certain period of time within 11am - 7pm
- Have an IDR or Smart Meter to be eligible.

Sdge.com/CBP
Capacity Bidding Program (CBP) / May - October
Day Of
Higher incentives than Day Ahead provided to customers who can immediately reduce their energy use when requested by SDG&E the day of an Event. Failure to reduce energy may result in a penalty.  Day of event by 9 am Year: No annual max
Month:  44 hours
Week: No limit
Day: 1 event

- Businesses receive higher incentives if they can reduce their energy use to a set amount, during a certain period of time within 11am - 7pm
- Have an IDR or Smart Meter to be eligible.

Sdge.com/CBP

Critical Peak Pricing
(CPP-D) / Year Round
A time of use rate which features increased costs during critical event periods. Failure to decrease energy use during an event can result in significantly higher prices.  Customer notification: Before 3 pm the day before the event. Year: 18 max events
Month: No limit
Week: No limit
Day: 7 hours           
(11 am-6 pm)
There is no required kW amount to decrease during a CPP event, but prices are significantly higher during a CPP event. May select a percentage of energy use to protect from the higher enery prices during a CPP event. This protected amount, called Capacity Reservation, can be between 0-50%.  Amounts greater than 0 will be charged a monthly capacity reservation charge.
sdge.com/cppd
Summer Saver / May - October $9/ton for the 30% cycling option and $15/ton for the 50% cycling option. During an Event Day the device overrides your thermostat and controls the amount of time your HVAC unit's condensor is allowed to operate.  Notification through the cycling of the A/C unit.  Year:  120 hours or 15 events
Month: 40 hours   Week: 3 days max  Day: No less than 2 hours but no more than 4 consecutive hours. 
- Businesses can receive annual bill credit for allowing SDG&E to periodically, up to 15 times, turn off their AC without advanced notice.
- >=20 <200kW/ month
sdge.com/summersaverbiz

 

  • What is the difference between a Demand Response event, a Reduce Your Use event and a Critical Peak Pricing day?

    Demand Response is a comprehensive term that encompasses all energy conservation initiatives/programs in the Demand Response portfolio. Two of the programs associated with Demand Response include Reduce Your Use and Critical Peak Pricing.

    When a call for energy conservation is issued it means that a Demand Response Event Day has been activated. As with the statement above, Demand Response Event Day is a comprehensive term that encompasses all the Program Event Days. Depending on how much energy conservation is needed to stabilize the grid any, or all, of the programs may each call their own program Event day (please refer to the chart above to better understand the requirements for each program).

  • I sometimes hear on the radio, or see on TV, that "today" is a Flex Alert Day. What is the difference between a Flex Alert and a Demand Response Event Day?

    Flex Alerts are a statewide call for energy conservation and are issued by the California Independent System Operator (ISO).  The ISO is a nonprofit, public benefit corporation that manages the flow of electricity across the high-voltage, long-distance power lines that make up 80 percent of California’s and a small part of Nevada’s power grid.  Flex Alerts can be triggered by heat waves, when power use outstrips electricity supply, unplanned power plant outages, or during fires that cause transmission line overloads, losses or limitations. Flex Alerts are posted on the ISO website, social media, sent by email and text to consumers who sign up for notifications, and the media is notified. 

    A Demand Response Event Day is called by SDG&E and is a call for energy conservation by those customers in the SDG&E territory that have volunteered to reduce or shift electricity use during peak periods in response to time-based rates. Customers can receive a financial incentive for meeting the “program specific” Event Day criteria. However, customers that don’t meet their “program specific” set criteria are penalized.

  • How do I know when SDG&E is calling for a Demand Response event?

    Make sure the right person at your business is signed up to receive notifications and alerts from SDG&E when event days occur. You can sign up for event notifications by logging into My Account and clicking on Alerts and Subscriptions.  SDG&E’s home page also contains notifications indicating which Program Event Days have been activated.

  • How is Auto Demand Response different from Demand Response?

    Auto Demand Response is technology enabled equipment and controls that can help streamline energy management and allow businesses to participate in a Demand Response program automatically. If you’re looking for a program that specializes in Auto Demand Response check out our  Technology Incentives Program.

    Demand Response is a call for conservation by SDG&E and can provide a financial incentives to those customers who volunteer) to reduce or shift electricity use during peak periods in response to time-based rates and can provide a financial incentive for doing so.