New SWEEP Report Explores Southwestern Utilities’ Successful Energy Efficiency Programs and Investments Designed Around Grid-Integrated Buildings

August 29, 2019

Justin Brant, Utility Program Senior Associate | 303-447-0078


[BOULDER, CO] – A new report by the Southwest Energy Efficiency Project entitled Grid-Interactive Efficient Buildings: Providing Energy Demand Flexibility for Utilities in the Southwest, provides a summary of the residential and small commercial grid-interactive building demand-side management (DSM) programs at the major utilities in the Southwest, highlighting existing programs in the region that are using grid-interactive buildings (GEBs) as a resource to help with the integration of variable renewable generation and to provide other grid services that create value for customers. The report showcases programs in this region (AZ, CO, NM, NV & UT) that are at the forefront of utilizing GEBs to provide value to the grid.

“We are happy to share this report that highlights leading programs and investments by electric utilities in the Southwest that are helping utilities better manage the electric grid, particularly with respect to expanding renewables, and helping customers save money,” said Justin Brant, the report’s author and SWEEP utility program senior associate.

The electric utility system in the Southwest has rapidly changed in recent years due to retirement of coal generation, low natural gas prices, decreased prices for energy storage and renewable energy resources, and increased investments in energy efficiency. This is leading to flat or decreasing utility sales and changes to most utilities’ generation portfolio, away from coal and toward renewable energy and in some places, natural gas-fired generation.

At the same time, peak electric demand continues to grow on both the electric system as a whole and on certain portions of the transmission and distribution system. Increasing peak demand leads to the need for investments in both electric generation to serve the new load and the transmission and distribution infrastructure to deliver power to customers.

Buildings in the United States are a major driver of these trends as they consume approximately 75% of electricity (source). However, buildings can also be a potential solution given that much of the electrical load in buildings is flexible and can be managed to operate at specific times and at different output levels. By adding advanced controls and communications systems to building equipment, building managers and grid operators can adjust power consumption to meet grid needs through controlling existing equipment such as heating, ventilation, and air conditioning (“HVAC”) systems, lighting, hot water heaters, and pool pumps. In addition, grid operators can now also utilize customer distributed energy resources such as solar photovoltaics, electric vehicle charging, and energy storage to manage peak loads and provide other value streams back to the grid.

The Rocky Mountain Institute (RMI) estimates that the demand flexibility available in buildings has the capability to reduce peak energy demand by 8% in the United States, avoiding $9 billion per year in utility capital investments. RMI also estimates that flexible buildings can supply an additional $4 billion per year in value to the electric grid by shifting energy usage to lower cost hours of the day and providing energy services back to the grid (source).

With its high and growing penetration of variable renewable (e.g. solar and wind) generation, the Southwest states are at the forefront of efforts to utilize GEBs to help better control power demand and integrate high levels of renewable generation into the electric system at a reasonable cost.

The report is available for download here.