Hot Issue: Demand Response (DR)
DR is favoured by policy makers because it's a quick way to flatten load and reduce the need for expensive peaking generation. Almost everyone buys into the concept, but implementing the idea can be a complicated process.
In Ontario, most DR products are designed and supplied by the Ontario Power Authority (OPA). To participate, industrial and institutional customers can go several ways:
- contract directly with the OPA for their DR1, DR2, and DR3 products
- contract with intermediaries ("aggregators") for derivative products
Pathchoice has been helping industrial and institutional clients through this choice process since 2006 to cut through the confusion, quantify risks and opportunities, and pick what makes the most sense for their operations.
As an example, we successfully lobbied the Ontario Power Authority (OPA) for the extension of DR1 from a pilot project into a permanent product and then helped twelve medium-sized industrials expedite their applications into the program in 2008. More recently, we have been helping clients improve their understanding and comfort levels with DR2 and DR3.
Watch for the following changes coming in 2010:
- a possible new, bid-based DR approach
- continued improvement in the existing suite of products (DR1, DR2, DR3)
- more transparency in program details
- more emphasis on generation-based DR
Evaluating Demand Response in Ontario is one of our company's key strengths.
Pathchoice Energy Consulting Inc.
2010 Pathchoice Energy Consulting Inc. All rights reserved. Website updated March 24, 2010.
For more information on DR products in Ontario, use this direct link to the
Going "direct" or "aggregated" under DR3?
Signing up as a direct participant maximizes the benefit to you as a participant, but can also expose you to large penalties for non-compliance. Ontario is significantly different from other North American jurisdictions and DR contracts here are very complex. We can help you understand and quantify the risks and benefits you will face.
If you decide to mitigate risk through an aggregation agreement, our intimate knowledge of the Ontario market can provide you recommendations how to proceed.
