The results are in. After only a year and a half in operation, Recurve's California Market Access Programs alone have added 38% to the system benefit of commercial energy efficiency and are delivering more than double the benefit of the average commercial efficiency program per unit of energy saved.
Market Access unlocks a vast Virtual Power Plant within California's 15M+ buildings to deliver peak demand reductions and support the grid during summer heatwaves.
Created in response to Governor Newsom’s Emergency Grid Reliability order, Market Access is scaling quickly, delivering significant long-term summer peak reductions, and reducing the cost of energy for California customers.
In December of 2021, the California Public Utilities Commission (CPUC) announced the creation of the statewide Market Access Program (MAP) in response to California's 2022 forecasted 4.4 GW electric capacity shortfall. Based on Recurve’s FLEXmarket, Market Access was designed as a low-overhead way to provide incentives for efficiency and demand flexibility aggregators to reduce peak demand to improve summer grid reliability.
While Market Access works with dispatchable demand response, its main focus is to reduce and shift energy consumption out of peak with long-term load modification through upgrades to building infrastructure such as HVAC, refrigeration, lighting, and controls. These projects save customers money and reduce peak load not just in year one, but for the life of the equipment.
Every dollar paid to project aggregators is based on measured performance at the meter and is cheaper than the cost of the alternatives. Customers benefit from bill savings and improved buildings. Payment is determined by total system benefit (TSB) per hour. TSB is the dollar value of energy savings at particular times of day, set by the state of California. This figure takes into account the value of avoided energy, capacity, transmission, and distribution expenses, as well as the value of reduced greenhouse gas emissions. This value is the same for all energy efficiency and even solar+storage as part of NEM3. However, because Market Access was created to address a grid emergency, TSB has been modified to reduce off-peak value by 30 percent and pay more for summer peak savings.
Market Access is scaling rapidly and delivering results all year round, with significantly increased savings during the summer peak when the avoided costs and payments are highest.
While the Market Access program is still less than a year old with just one more summer of desired peak load reduction under the current emergency proclamation, the portfolio is currently performing at 102% of the forecasted value — an extremely high realization rate compared to nearly every deemed or custom program.
Even more importantly, we are seeing that experienced aggregators, who have had a cycle to calibrate their estimates to actual performance, are achieving realization rates well above 100%. This means their projects are saving more than projected — an unheard-of outcome in traditional energy efficiency programs (though not atypical in pay-for-performance programs). We expect aggregators with lower realization rates will similarly see results improve next year as they take the opportunity to calibrate their predictions.
The Next Chapter
Market Access represents a significant re-imagining of how to deploy behind-the-meter resources to meet grid and climate goals. There have been challenges, but the speed with which utilities and LSEs have been able to launch and scale these programs in less than a year (an unheard-of speed) is proof that a market based on measured performance and total system benefits is viable, scalable, and has the potential to unlock hundreds of millions of dollars in avoided cost savings in California and across the country.
Get in touch with us to learn more.