Big US generators add negawatts to their gigawatts

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NRG, the biggest US power supplier, follows a trend to invest in a demand response company, rather than simply adding new generation.

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NRG, the largest independent electricity generator in the US, has acquired Energy Curtailment Specialists (ECS) one of the largest private demand response providers in North America.

It’s not a big deal in terms of money, but it’s significant in other ways. To meet demand, generation companies have simply built more generation. Now they are looking for smarter, and ultimately cheaper ways, to deliver their service.

ECS currently offers its customers ways to contribute to energy load reduction during times of peak demand and currently manages more than 2,000 megawatts of demand response across the US for its 5,000 customers, who receive payments for reducing their consumption at critical times on the grid. ECS is one of the largest players in the demand response market.

NRG currently provides 46,000 megawatts of generation capacity, enough to supply 40 million homes.

According to Greentech Media, NRG is following other major companies into the demand response market, noting Honeywell International’s deal with Akuacom in 2010, and Johnson’s Controls acquisition of EnergyConnect Group in 2011.

“We look for sustainable, competitive products that go beyond per commodities,” said Jim Steffes, president of NRG Retail Northeast told Greentech Media. “We want to give our product a more wholesome energy solution.”

But Greentech Media said the big energy companies are not looking just to have customers shed megawatts on the hottest days of summer, or at other times when there is peak demand.

Constellation, for instance, has merged its billing for commercial and industrial customers with demand response offerings so that customers could get a reduced rate on their bill. And demand response specialists such as EnerNOC and Comverge also say they view themselves as energy managers and not just demand response providers.

In 2011, the Federal Energy Regulatory Commission ordered that independent system operators need to create benefits to customers such offering a marginal price for electricity in off peak times.

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