- Executive Office of Energy and Environmental Affairs
- Massachusetts Department of Energy Resources
Boston — The Baker-Polito Administration today announced the awarding of 9 grants totaling $4,690,561 to incentivize companies to demonstrate innovation in peak electricity and gas demand reduction. The grants, funded by the Department of Energy Resources (DOER), seek to demonstrate business models that include both geographically targeted reductions to avoid and delay electric transmission and distribution investments, and broader strategies in electricity and gas peak load reduction.
“Massachusetts is proud to be a national leader in energy efficiency programs that reduce overall consumption and we are committed to continuing our work to improve energy costs disproportionately affected by times of peak demand,” said Governor Charlie Baker. “The demonstration projects funded through these grants will strengthen our innovation economy and provide the Commonwealth with a roadmap for reducing our most expensive energy loads and securing our energy future.”
“Today’s grants will ensure that the Commonwealth remains at the forefront of energy innovation by utilizing emerging technologies to reduce peak energy usage,” said Lieutenant Governor Karyn Polito. “From residential customers to municipal governments, these grants have the potential to have a serious impact for Massachusetts’ innovation economy and ratepayers.”
Electricity needs are met by generation in real time, leading to high prices and reliability issues during times of peak demand. In Massachusetts, nation-leading energy efficiency programs are reducing the overall use of electricity and passively curbing load growth; however, actively managing peak usage can reduce costs further. According to DOER’s State of Charge energy storage study, in Massachusetts, the top 1% of peak electricity demand hours account for 8% of electric energy costs, while the top 10% of hours accounts for 40% of overall electric energy costs. Because electricity transmission and distribution system investment is based on the single highest hour of use, reducing the peak demand can also defray the need for ratepayers to finance additions to system infrastructure.
“Reducing peak demand usage is a critical component of achieving our Global Warming Solutions Act emission reduction goals and making energy more affordable for all ratepayers,” said Energy and Environmental Affairs Secretary Matthew Beaton. “The business models tested by these grants will build upon the advancements we have come to expect from our Massachusetts’ companies for the benefit all ratepayers.”
“These projects represent another important step towards a clean, affordable and resilient energy future for the Commonwealth,” said Department of Energy Resources Commissioner Judith Judson. “By funding projects that focus on a wide variety of ratepayers – residential, commercial, and municipal – today’s grants will lay the groundwork for reducing peak demand statewide.”
The following projects have received grant funding:
- B2Q - $478,688 – Will work with National Grid to aggregate an energy portfolio in municipal buildings in the City of Medford to create a complete dispatchable demand reduction resource. This model could be replicated by any municipality in the Commonwealth.
- eCurv - $179,500 - Will work with Eversource to design an easily scalable model of peak electricity demand reduction for big-box retail stores, demonstrating on four Kohl’s sites in Massachusetts.
- Fraunhofer Center for Sustainable Energy (CSE) - $162,210 – Will work with National Grid to evaluate consumer attitudes toward and acceptance of using connected devices for peak demand reduction.
- Fraunhofer Center for Sustainable Energy (CSE) - $200,708 – Will work with National Grid to design, deploy and measure a small gas demand reduction program to assess the potential for and value of gas demand reduction at large.
- Genbright - $600,000 - Will demonstrate the ability to capture up to 6 value streams at retail and wholesale levels, including from peak demand reduction, by deploying behind-the-meter battery storage at a manufacturing site.
- Genbright - $1,500,000 - Will utilize thermal energy storage at residential sites for peak demand reductions on Nantucket. The project aims to demonstrate a non-wires alternative (NWA) to investment in a third undersea transmission cable to the island.
- Holyoke Gas and Electric (HGE) - $475,000 – Will install a grid-scale lithium-ion battery on a distribution feeder served from one of their substations. They will operate the battery for distribution peak demand management. UMass Amherst will analyze the performance of the battery and quantify the peak demand reduction value of the equipment for use by other utility companies.
- Sagewell - $98,000 - Will work with at least two municipal electric companies to demonstrate aggregated peak electricity demand reduction through off-peak electric vehicle charging.
- Tesla - $996,455 – Will demonstrate aggregated energy storage for peak demand reduction in Massachusetts. Tesla will work to quantify the benefits of the demonstrated peak demand reductions and evaluate the model’s viability at scale.
More information about the funded projects can be found here.
“I often hear from constituents about the need to steady the state’s rising energy costs. With this innovative grant program, the Baker-Polito Administration demonstrates their commitment to addressing those concerns,” said State Senator Don Humason (R-Westfield). “In my district, this funding will assist Holyoke Gas & Electric in their efforts to reduce the effects of peak demand usage, further improve energy efficiency, and promote ratepayer cost savings.”
“The transition to sustainable forms of energy is among the key issues facing Cape Cod, Martha’s Vineyard, and Nantucket. I am encouraged to see that Genbright has been awarded a grant to utilize innovative methods for peak demand reductions on Nantucket,” said State Senator Julian Cyr (D-Truro). “This grant will go a long way in helping to increase energy efficiency and affordability for residents in our unique corner of the Commonwealth.”
“I am happy the state can fund these grants to assist the municipalities in achieving electrical efficiencies that will ultimately save taxpayers’ dollars,” said State Representative Paul Donato (D-Medford).
“I am once again pleased to see the Baker-Polito Administration supporting energy generation and storage innovation that will be critical to our energy future here in the Commonwealth,” said State Representative Aaron Vega (D-Holyoke). “I continue to be impressed with the work and the collaborations Holyoke Gas and Electric have established to be a leader in the energy innovation sector.”
“As Nantucket struggles with how to meet its energy needs, it is crucial that we continue to deliver innovative solutions that lower costs for island residents. I applaud the Baker-Polito Administration's commitment to investing in Nantucket's energy infrastructure and advancing clean energy alternatives,” said State Representative Dylan Fernandes (D-Falmouth). “Genbright's $1.5 million grant to harness thermal energy storage on Nantucket is an important step towards lessening the impacts of peak demand usage on the island.”
In January of 2016, the Department of Public Utilities approved the 2016 2018 Three Year Energy Efficiency Plans of the Commonwealth’s electric and gas distribution companies and the Cape Light Compact. The Plan, which includes a specific focus on peak demand reduction, is expected to deliver an estimated $8 billion in economic, environmental and energy benefits - or three dollars in benefits for every dollar invested in efficiency. The energy savings goals in the Plans set nation-leading savings levels for both electricity (2.93% of retail sales) and gas (1.24% of retail sales). The energy efficiency programs are expected to reduce statewide carbon emissions by 1.95 million tons annually. This reduction is comparable to taking approximately 410,162 cars off of the road over the course of the Three Year Plan.
“The City of Medford is proud to partner with both public and private organizations to find the most beneficial energy solutions for the community,” said Mayor Stephanie M. Burke. “We strive to create a clean energy efficient community and will continue to invest in renewable energy projects throughout the City.”
Funding for these grants is available through Alternative Compliance Payments (ACP) paid by retail electric suppliers that do not meet their Renewable Portfolio Standard compliance obligations through the purchase of Renewable Energy Certificates.