By Jeremy Schwartz
Peninsula Daily News
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“This is a good news story,” city Public Works Director Glenn Cutler to the City Council on Tuesday.
The council voted to accept the grant 7-0.
Money from the $498,960 grant from Bonneville Power Administration, or BPA, will be paid directly to a handful of the city’s commercial utility customers and Nippon Paper Industries USA — the city’s only industrial utility customer — for voluntarily participating in the “demand response” project, said Phil Lusk, the city’s deputy director of power and telecommunication systems.
The project tests the feasibility of demand response, which is intended to save on electricity costs, Lusk said.
“This is all cash that will go to our customers,” he said.
The demonstration project, started last October and slated to wrap up in two years, follows on the heels of a smaller demand -response test project that involved eight commercial electricity customers, including the Clallam County Courthouse and the Port Angeles Library, and Nippon, Lusk said.
Demand response allows electricity providers to temporarily slow or shut down power flowing to customers who have volunteered to shut off power at the request of the agency that supplies them, Lusk explained.
This process allows electricity-providing utilities to better manage their power loads and help minimize power-use peaks, Lusk added.
In the earlier test, participants agreed to have automated devices hooked up to their utility meters that would reduce or shut off power via a signal from the city’s public works department, Lusk said.
For the larger demand response market project, Lusk said the city will use the grant from BPA, the federal agency from which the city buys electricity, to pay Nippon and commercial customers for voluntarily reducing power use when the city asks.
“We want to directly provide incentives for people who participate,” Lusk said.
City staff are still working out the details of how each participating customer would be paid, Lusk said, though payment most likely would depend on how much a customer reduces their power use and for how long.
The city expects to use about $48,000 in staff time in preparing contracts with the demand-response customers and other administrative costs, and about $10,000 in cash to buy hardware necessary for customers to participate.
“For about $60,000, we’re leveraging almost $500,000 in Bonneville incentives,” Lusk said.
“That’s a pretty good return, I think.”
In a phone interview Thursday, BPA spokesman Joel Scruggs said this demand-response project with Port Angeles will allow the agency to better understand how the agency can reduce power loads across its entire system and determine how best to use existing infrastructure without having to pay for new equipment.
BPA’s work with the city also will provide the agency with valuable information on how demand-response techniques and equipment can be used with BPA’s other customers, Scruggs added.
A system is in place now for residential customers who have had smart meters installed, about 2,000 so far.
They can receive a $10-per-month rebate if they voluntarily agree to have the city shut off their water heater during predetermined times during the day, Lusk explained.
Once the smart meters are rolled out citywide, Lusk said, all city residents will be able to sign up for this completely voluntary $10-rebate demand response practice.
Reporter Jeremy Schwartz can be reached at 360-452-2345, ext. 5074, or at email@example.com.