When we crank up the air conditioning to battle another week of smothering heat, or rest by a space heater during a frosty cold front, we put our faith in the complex systems working behind a power switch to keep our spaces livable. But when our collective demand for electricity surges in a short period of time – if, say, everyone turns on their air conditioners during a heat wave – a lack of proper demand management can force us to turn on costly back–up fossil fuel-powered generators or worse, trigger catastrophic blackouts. The City of Philadelphia participates in two initiatives that not only help reduce stress on the power grid, but also give back in the form of cost savings and financial rewards, which are used to fund energy efficiency projects for municipal buildings.

System Peak (“Red Day”) Alerts  

“Red Days” happen when the City is projected to experience the highest demand for electricity, and they sometimes coincide with extreme weather events such as heat waves. They’re also opportune times to save on energy bills. 

Every year, the City’s future energy pricing is partly determined by how much energy it used during “Red Days”, also known as its Peak Load Contribution (PLC). The more energy City buildings consume during periods of peak energy demand, the higher the PLC fees are on next year’s bills; however, if the City defies expectations by reducing energy use and easing the burden on the power grid, the fees are lower. 

The Energy Office team sends “Red Day” Alerts reminding building operators to proactively reduce energy use during peak times, therefore lowering energy costs for the coming year. Previous efforts to lower energy use during “Red Days” will save the City an estimated $1 million through part of 2021 and 2022! 

Demand Response Program

The Demand Response Program calls on building operators to drastically reduce energy use during grid emergencies, when electricity demand is intensifying to a point it threatens blackouts. When the City responds by reducing energy use toward a pre-determined goal, the Energy Office is then rewarded with a check that can fund energy efficiency projects. As of July 2022, the City has not experienced a grid emergency in eight years, but it undergoes an annual audit testing its ability to lower energy use in case of an emergency event. Most municipal buildings hit the energy reduction target during last year’s audit, earning the City potentially up to $250,000.

Through “Red Day” Alerts and the Demand Response Program, building operators are often working behind the scenes – adjusting lighting and temperature, and shutting off non-essential electrical equipment, for instance – to achieve critical energy savings. As climate change brings about more extreme weather events, managing our energy demand and transitioning towards greater energy efficiency is key to maintaining a stable power grid that can continue supporting our needs.