How Smart Thermostat Programs Can Grow REP Revenue and Profitability
By Energy Marketing Conferences
Smart Thermostat programs offered by Retail Energy Providers can accomplish three goals. They can help REPs mitigate exposure to real-time price volatility creating significant supply savings; they can create a new revenue stream for the REPs (through customer participation in demand response programs) and they can help REPs acquire and retain customers.
Smart thermostats are effectively Distributed Energy Resources (DER). By managing them properly, REPs can utilize them as a flexible physical hedge, automating dispatch based on real-time LMPs in ERCOT. Over the last three years, a single residential customer with a properly managed smart thermostat would have delivered average supply savings of $90/year (in Houston load zone). Multiply these savings by 100,000 customers, and you can understand why REPs are excited about making smart thermostats a major part of their businesses in the ERCOT market.
The Pay for Performance” Demand Response programs in the state of Texas generate a new revenue stream of approximately $57 per customer per year. If you add that to the $90/year of supply side savings per customer, then every customer with an accessible smart thermostat will create about $147 in annual profit enhancement for REPs (less any service fees). This does not take into consideration the power of a differentiated sales pitch to prospective customers or the power of retaining these customers for many years.
There are many makers of smart thermostats but there aren’t enough companies who can bring the back-end technology to instantly convert smart thermostats into a “plug and play” profit engine for REPs.
On May 25th at 11:00am EST the Energy Marketing Conference will host a free webinar sponsored by Resideo entitled, “STRATEGIES FOR DESIGNING A SUCCESSFUL SMART THERMOSTAT PROGRAM.”
Every REP serving in Texas should be thinking about how to launch a smart thermostat program. After the events of February 2021, this has become a “must attend” webinar for REPs who desire not only to survive, but to thrive.
Resideo has implemented over 25 smart thermostat demand response programs across the US and will share best practices for customer acquisition and product deployment. They have a unique service designed specifically for REPs that automatically mitigates exposure to real time price volatility in ERCOT.
I will be moderating the Webinar and David Drew will be the speaker. David has extensive experience implementing smart thermostat programs. He has accumulated 6 patents related to HVAC controls, and has his MBA from Washington University in St. Louis.
REGISTER HERE for free and join us for this one-time event.
Jack Doueck is the founder and principal of Energy Marketing Conferences, Advanced Energy Capital, and LED PLUS.
