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EnerNOC (s ENOC), a Boston-based company that reduces electricity demand for power grid operators by automating energy conservation, announced today that General Mills (s GIS) has joined its demand-response network. The food giant will use EnerNOC software to cut its West Chicago Facility’s energy load by up to 5 megawatts during periods of peak demand, such as during heat waves when air conditioners often work overtime. With similar reductions at commercial and industrial sites across its network, EnerNOC helps energy providers avoid blackouts and brownouts caused by overcapacity.
Network members like General Mills, Adobe (s ADBE), MIT and General Electric (s GE) don’t do this for free, of course. They receive periodic “capacity payments,” regardless of how much (or how little) their electricity gets dialed back, plus a “curtailment payment” when EnerNOC switches them into conservation mode. By reducing consumption during high-use periods, when electricity rates spike, they can also cut costs.
EnerNOC, which was founded in 2001 and went public last year, has plenty of company when it comes to demand-response technology, or energy information management. It’s part of the larger smart grid technology market, which Lux Research anticipates will reach $4.7 billion by 2013, up from $2.7 billion this year. According to the Department of Energy’s Lawrence Berkeley National Laboratory, automated demand-response has reduced peak-period demand in California by an average of 10 to 14 percent each year since 2003.