Advancements in thermostat technology have introduced connected and smart thermostats into the broader consumer electronics market, leading more utilities to consider using these technologies for DR programs. National Rural Electric Cooperative Association (NRECA) recently engaged Research Into Action to conduct a technology review on smart thermostat DR programs, including their design, performance, and implications for electric cooperatives and the industry as a whole.
What we did
Our research examined the full range of DR program models, including Bring Your Own Thermostat (BYOT), direct-install (DI), and buy-down programs. We also researched the key stakeholders and technologies that influence the design, administration, implementation, and performance of smart thermostat DR programs. We then identified a step-by-step process that utilities can follow when designing these programs and compiled several case studies on current pilots in across the country. Specific research activities involved:
- An in-depth review of recent reports on smart thermostat pilots, articles in trade publications, and online resources
- In-depth interviews with representatives from investor-owned and municipal utilities across the country that are currently running smart thermostat programs and pilots
What we learned
- Data availability, standardization, and security/privacy, as well as interoperability, all present significant barriers that DR programs must address to achieve success.
- A review of 15 different thermostat studies, thermostats have the potential to reduce energy use by as much as 7.7% to 12% in the winter months, depending on whether they are attached to gas or electric furnaces. For summer months, cooling savings are close to 10%. Utilities should anticipate an average demand reduction of 0.6 kW to 2.37 kW for each thermostat.
- Although consumers prefer higher incentives, relatively few end-users will lose interest in participating in a smart thermostat program if offered substantially lower incentives.
- There are five critical key steps to designing any smart thermostat DR program: conduct initial research and planning; agree to and get buy-in on a specific program design; evaluate vendor options; develop customer engagement and marketing strategies; and develop and plan for tracking and analyzing data.
- Interviews with program administrators revealed that customers generally respond positively to smart thermostat DR programs. Many of the pilots are exceeding their initial installation objectives and opt-out rates are very low. In addition, program design features such as online dashboards and on-site installation provide valuable opportunities for customer engagement.
Smart thermostat programs are still in their infancy. Utilities and co-ops across the country have run several smart thermostat DR trials and pilots, which have demonstrated DR potential. Findings from these pilot studies suggest these programs have the potential to reduce load and save energy, but results vary based on the devices, occupant behavior, weather, and program software — and, no program to date has successfully leveraged the sensing and learning features found in newer thermostat models to achieve savings. Thus, fully determining the effectiveness and impacts of these programs will require further research and pilot studies.
Read the full article.