LEED To Embrace Demand Response

Green buildings, meet demand response. The U.S. Green Building Council is studying ways it can count demand response — turning down power to help utilities shave peak power demand — as part of its LEED rating system. That could open up new incentives for big commercial buildings to install technology that connects their LEED buildings to smart grid systems, and open up new markets for demand response providers around the country.

The USGBC expects to publish its first “Demand Response LEED Pilot Credit” later this spring. Next up will be a series of pilot projects that will bring existing LEED buildings into demand response programs, said Brendan Owens, vice president of LEED technical development at USGBC.

While the pilot projects haven’t been named yet, Owens said they should be able to take part in this summer’s demand response season, to help the USGBC and its partners figure out just what weight to give demand response credits in LEED’s Energy & Atmosphere Credit system.

As for just how many LEED points could be attached to demand response, he said it’s too early to say. While building energy efficiency and onsite renewable energy are currently counted for LEED ratings, “this is the very first time we’ve deliberately gone to the other side of the meter,” he said.

Still, there’s good reason for green building standards to take peak power reductions into account, he said. Utilities are desperate to cut their peak loads, which otherwise have to be met with expensive “peaker” power plants, usually gas-fired turbines, that sometimes only run for a few hundred hours every year. Keeping peak load growth in check can thus have an outsized effect in reducing the overall carbon footprint associated with electricity generation.

To date, demand response hasn’t had as much success in the commercial building market as it’s had in the industrial sector, Owens noted. Factories have lots of energy management and power system systems in place that can be tapped to shave power. Commercial buildings can have a harder time turning down air conditioners or lights to meet demand response calls, both because they lack technology to automate the process and because they don’t want to displease building tenants.

Indeed, the new program could be a key way to expand the share of commercial buildings interested in participating in demand response, he said. USGBC has identified about 4,400 LEED-certified buildings that could be targets for demand response, and LEED-certified buildings add up to some 6 billion square feet, with 1.5 million more square feet per day in new buildings registering for certification, he noted.

LEED building owners — the kind of energy-aware, ratings-motivated customer base — could provide a significant opportunity for utilities and demand response providers trying to expand their markets. Big demand response aggregators such as EnerNOC (s ENOC), Comverge (s COMV) and Constellation Energy (s CEG) will likely be looking at ways to approach the LEED opportunity, as well as big building control players such as Honeywell (s HON), Johnson Controls (s JCI) and Schneider Electric that have been making moves into demand response technologies.

In fact, Schneider is on the USGBC committee that’s working on the new demand response credit, and will be playing a role in the pilot projects set to start this summer. Ross Malme, former director of Schneider’s demand response resource center who recently left to become a new partner at consulting firm Skipping Stone (another partner on the project) told me last month that companies are looking forward to being able to market their demand response programs as “sustainability services,” rather than just ways to shave energy use to make money.

Another partner on the USGBC project committee is Lawrence Berkeley National Laboratory’s Demand Response Research Center, home of the technology known as Open Automated Demand Response, or OpenADR. Owens said that the council would prefer participating buildings to have technology in place to automate the way they turn down power in response to demand response signals, though it won’t be required, and having Berkeley Labs on board probably means that OpenADR will be given a chance to fill that role.

Image courtesy of Logan Sakai via Creative Commons license.