Negawatt box
What is it and how does it work?
There has been a lot of buzz recently about the concept of a negawatt box. I've written previously about negawatts, a concept pioneered by the visionary Amory Lovins; the idea is basically that it's generally cheaper, when demand for electricity exceeds supply, to find ways to reduce demand, rather than to install new generating capacity. Lovins called the concept 'negawatts', in contrast to 'megawatts', since they negate electricity use.
There really isn't any one such thing as a negawatt box. Instead, a number of devices can accomplish (or claim to accomplish) the objective of reducing electric demand, either intrinsically or by modifying behavior through either pricing signals (if you know something is expensive, you're liable to use less of it), or simply consumption awareness (if you know how much of something you're using, you tend to control your use of it more).
In the case of the companies that are touting a 'negawatt box' approach to electricity generation, such as ComVerge, EnerNoc, Echelon and Itron, their model is straightforward: work with utilities to install devices and create incentives in homes and businesses within the utility's service area, in order to encourage power consumers to reduce their electricity use, especially during peak demand or peak price times.
The actual 'negawatt box' these companies may refer to (or may be associated with, for instance in the media or in investment newsletters touting their stocks) could be any of the following:
- Smart meters
- Peak demand controls for heating, air conditioning, or electrically heated water
- In-house electricity consumption meters
In addition, 'negawatt' companies may work with their client utilities to design one-time pricing incentives to encourage consumers to upgrade to equipment that will use less of the utility's power (especially at peak times).
Let's look at each of these in a bit more detail.
Smart meters
The old model of electrical pricing has always been that you are charged a set rate per kilowatt hour (with the price being either a single price, or a blend of generation, delivery, line losses, and other charges - for instance the debt retirement charge we in Ontario pay, to make up for the sins of the Ontario government racking up one of the biggest public utility debts in world history over several decades). But it actually costs utilities far more to generate electricity when demand peaks, than when there is very little demand. For example, at 3 am, there may be more than enough hydroelectric and wind power already available in a utility's own generating capacity to meet all available demand, since everyone is sleeping, and unless it's a bitterly cold night and a lot of people heat with electricity (or a sorching hot night and everyone has their AC on), they don't need to turn on more expensive (or more polluting) sources, such as coal, natural gas, or nuclear power. But at 2pm on a July weekday when it's 100F in the shade, and commercial and industrial customers are busy keeping their employees cool and the stamping presses going, there can be so much demand that bidding wars can set the spot rate for electricity soaring.
For a long time, industrial customers have paid different rates for power depending on when they used it; this has been the case for commercial customers as well in many areas, and is becoming more and more so for consumers as well. Smart Meters are the negawatt box technology that allow utilities to charge consumers based on not only how much power they consume, but when; and Smart Meters also allow the consumer to monitor their own electricity use, and typically by using a web interface, to see how much they are consuming when, and how much it is costing them.
The more you know about what something costs you, the more likely you are to cut your costs. And the higher the cost to you at peak times, the more inclined you'll be to cut your usage back (or move that usage to other times of the day). Couple this type of negawatt box with newer appliances that let you delay a drying or washing cycle for your laundry, or run the dishwasher or the bread maker at 3 am, and consumers become empowered to cut their power use. They save money - and the power utility doesn't have to build new generating capacity, which saves them money.
Peak demand controls
Another type of negawatt box is any device that throttles back electrical use for a particular high-demand device, when the utility sends a signal indicating that a peak load situation is happening or is imminent.
In my home province of Ontario, several utilities participate in the PeakSaver program for air conditioners and electric hot water tanks. The idea is pretty simple: over the course of a half hour, an electrician installs a control on or near the compressor (the outdoor air conditioning unit) or on the line supplying power to the hot water heater, and this device can be activated remotely by the utility at times of peak demand, to turn the air conditioner or hot water heater off. Air conditioners are cycled off for 15 out of every 30 minutes - typically this is a small enough period that you should not notice any change in indoor comfort - and hot water heaters are shut off during the entire load management period, which is usually short enough that you should not notice any lack of hot water. You certainly won't suddenly find yourself in a cold shower - unless that's how you like to deal with summer scorchers!
Utilities incent customers to install these devices, typically by offering a cash bonus or bill credit when the device is installed. When I had mine installed several years ago, I got a $25 PeakSaver bonus; some utilities in Ontario are now offering $75 bonuses! And once it's installed, you'll hardly know it's there - or might even forget!
In house electricity consumption meters
The third type of negawatt box that such companies may provide as part of their demand management program are electricity consumption meters that help consumers measure the electrical usage of individual appliances, devices, tools, and so on. Devices such as the Kill a watt meter can be bought online for $20 or so - and no doubt companies like EnerNoc and Echelon can buy them for far less in bulk for distribution to large numbers of utility customers. Just throwing such devices at customers often won't accomplish much, but if it is accompanied by education, it can work wonders. In our own household, we used a Kill A Watt meter to cut our home electricity use by 30% or more in a matter of a couple of months. The more devices a customer measures at home, the more aware they become of where they're using electricity, and the more changes they are likely to make to cut back.
Does a capacitor device count as a negawatt box?
There's a device sometimes known as an energy saving capacitor that can be installed within a few minutes on your breaker panel, and that purports to save you up to 30% of electrical use for just the $200 or so purchase price. Some people have wondered whether the companies partnering with utilities would include these capacitors in their 'negawatt box' offerings.
As I describe in my article on that subject (linked just above), these devices are completely useless for most consumers. Websites touting them tend to claim that utilities don't want you to know about the devices, because you'll consume less power and therefore the utilities won't make as much money. This statement is complete nonsense - as I pointed out earlier, most utilities prefer to get their customers to cut usage, rather than to increase it. But more importantly, these devices, while they can cut power usage on inductive loads such as those found in factories (or even the motors in some older devices in your home), will do almost nothing for your overall energy use, because most of the energy used at home is either not inductive, or is an inductive load in a device that already includes its own built-in capacitor to achieve the same result.
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