March 30, 2021 – Are hotels a good fit for a demand response program? In this video, Strategic Energy Advisor Sam Greenberg explains how hotels can participate in the program and generate extra revenue for their properties.
Hi! I’m Sam Greenberg, Strategic Energy Advisor with Nania. Did you know enrollment for demand response in PJM is coming to a close for 2021?
Don’t worry — it’s not too late, but spots are filling up fast.
For this week’s Two-Minute Tuesday, I’m going to address whether it makes sense for hotels to sign up for demand response.
What is Demand Response?
Demand response is a program that provides financial payments to power customers for their ability to reduce electricity usage during times of peak grid demand. Think of hot summer days when it is 100 degrees out, and A/C usage is at its peak.
Depending on the amount that you are able to reduce from your average usage, this program could mean additional revenue for your business.
Are hotels a good fit for demand response?
Every commercial property has the ability to curtail their usage, but for some businesses, it may be easier than others.
If you’re a hotel owner, you may think that curtailing is impossible because you can’t tell your guests in their rooms to turn off their air. However, some hotel operators have found creative ways to reduce usage and participate in this program.
Does your hotel have on-site laundry?
Does it have a heated pool?
Do you have a modern building automation system (BAS) that allows you to adjust thermostat temperatures or pre-cool your building?
If you are able to reduce usage for a one-hour test event each year, you qualify for the program and the financial incentives that come with it.
There are other ancillary ways to reduce usage, such as shutting down an elevator or two or dimming LED lights if your system allows for it. The more you’re able to reduce, the greater your payment under the program will be.
Bonus Benefit of Demand Response
Not only is demand response an opportunity to put additional money in your pocket as a business owner, but it also makes your business look good since you’re doing your part to support the grid while prioritizing energy efficiency.
Demand response is not for everyone, but it is a way to capture additional revenue for those who can participate. Given the past 12 months for hotels, signing up for this program before the May 1st deadline could be a great way to ease some of the financial burden that COVID has places upon the industry.
If you have any questions about signing up for demand response, please contact me or any of the advisors on our Nania team.