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How Chicago buildings can help lower prices, keep the lights on

imgresThe magnificent Chicago skyline draws tourists from around the world, but it fascinates CUB for an entirely different reason: It has the potential to become a powerful tool in our never-ending quest to make the electric grid more efficient and less costly for consumers.

CUB is working with the Environmental Defense Fund (EDF) and PJM, Northern Illinois’ power grid operator, to make that point in a groundbreaking pilot project.

“Facing our energy challenges requires Illinois to seek innovative ways to reduce electricity demand,” CUB Executive Director David Kolata said. “Programs like this are a win-win-win for Illinois. They’re good for our power grid, our planet, and our pocketbooks.”

The Combined Capacity Asset Performance Project (C-CAP), is exploring how Chicago buildings—including county government facilities and the Shedd Aquarium—can preserve something called Demand Response (“DR”) in the face of new PJM rules in the electric market.

DR is an umbrella term for cost-effective, energy-saving programs that pay customers to reduce electricity use in response to the power grid’s needs. Such programs ask homeowners or office buildings to periodically adjust their thermostats a few degrees, for example. That helps to lower electricity prices, reduce reliance on coal plants, and keep the lights on when the grid is stressed.

Each year PJM manages special “capacity auctions” to secure enough power for the grid during these times of peak demand. Through a bidding process, power plant operators commit to making their facilities available to provide electricity for the PJM region (13 states and the District of Columbia). DR programs also can bid in the auction to reduce the amount of electricity required at peak times.

Up until now, those peak demand times typically meant blazing hot summer afternoons. But now PJM has implemented more stringent auction rules that force bidders to commit to year-round relief of the grid.

Unfortunately, DR is mostly a summer thing—because it’s usually easier to curtail on such big-ticket energy items like air conditioning. According to an analysis by The Accelerate Group, up to 80 percent of existing demand response participants are best-equipped to help during a limited number of summer events.

So this development threatens the loss of 8,000 MW of DR—enough to power more than 2 million homes, Accelerate estimates.

But C-CAP provides a solution: If a building can’t meet year-round rules, why couldn’t it combine with other buildings (as well as home thermostat programs, wind and solar farm, etc.) to create a “combined asset” that would fill in the gaps for each other over the year. 

Of course, this is just the first step of a complex, multiphase project, but it’s a beginning. Stay tuned for updates. In the meantime, go EDF, PJM and CUB! Our power bills are depending on you.