Heather has discovered one of the more popular energy saving programs in the
country. Not only do consumers like the savings, but the program also reduces
costs for the electric company. So it's a classic win/win situation.
How do the programs work? Actually they're pretty simple. Florida Power & Light
(FPL) calls their program "On Call(r)" and claim to have over 700,000
participants. Their program focuses on A/C, central electric heat, the water
heater and pool pumps.
FPL adds a small control box to the homeowner's appliance that can be run from a
central location. The box allows them to shut off the power to that appliance
for short periods of time during peak usage. They claim that the homeowner is
unlikely to notice when it is being used since the time is relatively short.
FPL customers have two choices. One is for a 15 minute shutdown. The other for a
four hour shutoff. The consumer selects how many of the four appliances that
they want included in the program.
For instance, if you have your A/C on the 15 minute program your bill is reduced
$21 per year. The four hour program will pay you $63 for your A/C. With FPL's
program you can save up to $137 per year if you allow them to control all four
appliances in the four hour program.
Why do the electric companies offer these programs? They're in a tough position.
We expect them to supply power whenever we request it. Without fail. That
includes the hottest day of the summer when everyone's air conditioner is
running continually.
But the capacity that's needed for peak demand isn't needed most of the time. So
if the electric company can reduce peak demand they won't need as much capacity.
That could eliminate the need to build new power plants. Which translates into
avoiding a major expense for the utility company. FPL claims that their program
has eliminated the need to build two additional generating plants.
Consumers generally like these demand response or load management programs. The
electric company pays for the installation. Usually the inconvenience is minor.
And the savings help reduce a bill that has had a tendency to increase.
In the future we'll see even more of this type of demand management. It's
difficult for utilities to get the approval and financing to build new power
plants. So they have a big incentive to reduce peak demand.
Some utilities are beginning to offer variable pricing. The consumer pays more
for electricity during peak usage times. Less for off-peak hours. So far most of
these programs are aimed at large industrial users of electricity, but they're
beginning to reach the consumer market.
Technology is allowing the utility companies to go beyond the old tools. The
demand management boxes are currently controlled by a radio signal, but future
technology will allow for computer control of major appliances. That will mean
that consumers will be able to turn an appliance on or off using their cell
phone or computer.
And the number of appliances that can be controlled will continue to increase.
New appliances may be designed with the controlling devices built-in.
So not only is it a good idea for Heather to sign up for the 'cycling' program,
she should also see what other energy-saving programs are available through her
electric company. Some utilities will pay the cost of a duct inspection and will
contribute to any repairs needed. Others offer rebates if you update old
inefficient appliances or add insulation to your home. The savings could be
significant.
Heather has found one of those situations where she can help her checkbook and
the environment at the same time. Plus, she'll be reducing the amount of energy
she consumes. Pretty much a good deal all around!
Gary Foreman is a former purchasing manager and financial planner. He currently
edits The Dollar Stretcher website <www.TheDollarStretcher.com>
and newsletters. If you'd like to save time or money, visit today!