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Lower Your Electric Bill by…Doing Nothing

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This summer, do you want to get paid for the time you are not home? No, the summer swelter has not gone to your head, but it can save you money on your electricity bill - here’s how:


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You may have noticed that electricity tends to cost more in the summertime – power companies often have a winter rate and slightly higher summer rate from about May through October. This is because power demand is higher when it’s hot, due to all the cooling devices that run on electricity (unlike heating which can be fired by oil, gas, woodstoves, and other stuff). To make matters worse, the hottest times - when we use the most air conditioning - typically coincide with the times people and businesses are using the most electricity for other things, like powering office buildings and factories. These periods are called “peak load” or “peak demand” periods and cause utilities all kinds of headaches.

To meet this load, power companies have to fire up every power plant they have, which is both expensive and often bad for the environment. Those costs get passed on to consumers in the form of higher electric bills.

Thus, electricity suppliers are eager to cut peak demand: so eager that they will pay you to use less power during critical times in order to make sure electricity demand does not exceed supply. One of the incentives is called direct load control. In exchange for allowing them to turn down your air conditioner during peak load times, electricity suppliers offer rebates and other financial incentives: free money to buy ice cream when it’s really hot outside!

The thing is, some of us aren’t even home during those times – extreme peak demand situations tend to happen in the afternoon on weekdays, when we are sitting at the office and couldn’t care less how hard our air conditioner is running. In fact, many of us already have our thermostats on a program cycle that lets things get warmer when no one is home.

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With direct load control incentives, electricity suppliers pay you for the right to turn your air conditioner down in the few cases of extreme peak demand per summer - whether they actually end up having to do it or not. The reward is usually a one-time credit just for signing up, plus various additional rebate styles. Duke Energy’s Power Manager program in Indiana offers a payout every time the energy-savings feature is actually used, while Baltimore Gas & Electric's Smart Energy Rewards pays $1.25 per kilowatt saved from June through September. Often program participation includes a free new fancy thermostat that you can monitor and reset online, so you can better manage your own power consumption if you want.

Obviously direct load control is not for everyone – if you are at home on a hot mid-day, having the utility cycle the air conditioning on a hot day is not be the most appealing idea. Some of the programs account for this by offering different degrees of interventionPepco’s Energy Wise Rewards program in the Maryland and DC area and San Diego Gas & Electric's programs have the biggest rebate for those willing to cycle their air conditioner at 100% when necessary, but offers 75% and 50% cycling options for those who can take some slightly warmer home temperatures in exchange for a (smaller) rebate. Other programs such as Dominion's Smart Cooling Rewards program offer you the choice to opt-out of a cycling event a couple times per summer.

So no matter how hot it gets, you may be able to save some real money and help the environment by participating in direct load control…check what programs are on offer in your area.

By Lisa Zelljadt, you can find me on Google+

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