When last summer brought record-breaking temperatures to much of the country, Southern Maryland Electric Cooperative's four-county service territory southeast of Washington, D.C., wasn't spared the sweltering weather.

But SMECO, as the co-op is known, had a powerful tool on its side as it faced repeated peak load challenges: the assistance of tens of thousands of its members.

The cooperative, based in the small town of Hughesville, Maryland, operates CoolSentry, one of the most successful demand-management systems in the nation. The automated thermostat-control program, now in its 10th year, can control more than 45,000 devices, which cut costs by curbing residential air-conditioning and commercial power loads during summer peaks.

"The member reaction has been very positive," says Jeff Shaw, SMECO vice president for distributed energy and sustainability. "A lot of members have more than one device, which tells you how positive it's been."

SMECO is one of the largest distribution co-ops in the nation, providing power to about 163,000 meters. About 90,000 meet CoolSentry participation requirements, which include a relatively up-to-date and efficient central heating, ventilation, and air-conditioning (HVAC) system, and half of those have enrolled.

"That's a huge number," notes Brian Sloboda, a program manager in NRECA's Business and Technology Strategies group. "The fact that they got to 50 percent is just amazing."

Residential members who join CoolSentry receive free installation of an IntelliTEMP programmable thermostat, while commercial and industrial members receive an IntelliPEAK outdoor load-control switch. Both come from Itron, the energy technology and services company, which operates CoolSentry on a fee-for-service basis for SMECO.

The programmable thermostat can receive an automated signal to reduce the cycling of a home HVAC system by 50 or 75 percent, depending on what level the member has signed up for. If the central air-conditioning system ran for 20 minutes the previous hour during a peak event, for example, it would run for 10 minutes under a cycling reduction of 50 percent.

In addition to a free thermostat, members who sign up for 50 percent cycling receive a $50 bill credit spread over five months. Those who choose 75 percent cycling receive $75 back in $15 monthly credits. The incentives are different for commercial and industrial accounts, which also receive an email before a load-control event so they have time to start generators.

Mandate to Reduce

SMECO originally turned to Itron and CoolSentry in response to a 2008 state law known as EmPOWER Maryland, an energy efficiency initiative that included a mandate for utilities to reduce per-capita energy use and peak demand by 15 percent by 2015.

"Embedded in EmPOWER Maryland was a demand-response provision," Shaw says, and SMECO, which already had a legacy demand-response program that involved on/ off control switches for water heaters and air conditioning systems, saw an opportunity to update its approach.

The cooperative decided on a fee-for-service contract with a single vendor because "it just seemed to make a lot of sense that we were only going to be paying for what somebody could deliver for us," Shaw says.

EmPOWER Maryland has been extended by the state legislature, and in late 2017, SMECO signed a three-year extension of its contract with Itron, which is compensated based on the kilowatts saved through the program.

Itron works closely with SMECO but is responsible for promoting CoolSentry, signing up co-op members, installing and maintaining control devices, and handling the automated signals that start load control events.

Early on, promotion relied on SMECO gatherings, radio spots, and a broad-based mail campaign. But as the program has matured, outreach efforts have evolved to direct mail, phone calls, and door-to-door solicitations.

$39 Million in Savings

Shaw believes SMECO's legacy demand-control program helped with the initial success of CoolSentry because members were familiar with the concept. The environmental impact of reducing demand was another plus, he adds, while the financial savings, not just for participants but for the entire co-op, also played an important role.

"From a systemwide perspective, all SMECO members have benefited from reduced energy costs," Shaw says. When the cooperative's avoided capacity obligation in the PJM energy market is taken into account, CoolSentry has saved SMECO about $39 million, and every member has benefited by "not having those costs in the bill."

Initially, CoolSentry used a three-degree temperature setback with residential members to reduce load. "But looking at the data, we weren't getting the kilowatt delivery that we thought we needed to make this viable," Shaw says. "So we morphed into the 50 percent and 75 percent cycling options, giving our members a little more choice."

About 90 percent of participants choose the 50 percent cycling option, he says, which keeps air circulating in the home and lessens the impact on its residents.

"The strategy is really about comfort, but also about economics and helping to target the critical peaks," says Steve Hambric, Itron's head of distributed energy management.

Approved Devices

NRECA's Sloboda notes that thermostat control is growing as an approach to end-use energy management.

"We're seeing a number of utilities, including cooperatives, encouraging their customers to adopt smart thermostats and enroll them in demand-response programs," he says.

Some co-ops are working with a single vendor, while others are taking a "bring your own tech" approach where customers are given a list of approved devices they can buy, which the co-op can then connect to.

"It's really the difference between a top-down and bottom-up approach," he says. "And there's no one right answer."

Thermostat control has grown as an approach, he adds, partly because of the increasing popularity of smart devices like NEST and Ecobee.

"The thermostats give you the advantage of adding to your energy efficiency program because they tend to learn customer behavior" and can reduce power when the house is empty, Sloboda says. "So they have an additional energy impact beyond demand response."

Shaw says SMECO members can now add a NEST or other smart thermostat to the CoolSentry program.

"We know there are a lot of different players in the market, and that's where we're moving, to allow for that customer choice, to allow them to choose any vendor and then embed them into our energy program," he says.

If a member wants a NEST or other smart thermostat capable of learning, SMECO will install a separate digital cycling unit to integrate it into CoolSentry, Shaw says.

Part of a Larger Puzzle

The cooperative's evolving approach is part of the rapidly expanding field of intelligent end-use energy management, a field that NRECA, among others, is working to expand far beyond traditional demand-control options.

"We are partnering with the Pacific Northwest National Laboratory to look at how the entire house might be used in a way that does not inconvenience the consumer and might be automated," Sloboda says.

The concept, known as the "utility connected home," could maximize energy savings by working with multiple appliances and systems within the house, rather than just HVAC or water heaters, while at the same time reducing the inconvenience to the resident that can come from cutting back on air conditioning or even hot water.

"You're not going to make the home uncomfortable," Shaw says. "And you're going to maximize energy savings."

SMECO is planning along the same lines as it continues to build its demand-response program.

"What we're doing, starting this year and going forward, is the smart home," Shaw says. "We have that out to our members in a pilot program."

The project includes connected lighting load, controllable water heaters, "and sensors on doors and window that lets the member know something could have been left open that was not intended to be left open," he adds.

Down the road, SMECO also hopes to overlay "some level of artificial intelligence" into the system, which would involve learning the habits and preferences of the residents.

"We call it thermostat optimization," Shaw says.

He notes that end-use management is only part of a larger puzzle that also involves renewable energy and storage to provide maximum efficiency and sustainability in the co-op's power mix, meeting both government and member expectations.

"They're all important parts of the approach," Shaw says. "There isn't one magic bullet to all of this. You want to give your members a range of options."

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