April 11, 2018

Whitehouse Introduces Innovative Natural Gas Demand Response Legislation

Bill would help reduce costs for consumers and get more from existing natural gas infrastructure

Washington, DC – Senator Sheldon Whitehouse (D-RI) introduced legislation today to encourage natural gas demand response programs, which reward reducing energy use, a model well established for electricity customers.  Whitehouse’s bill is one of the first pieces of federal legislation that leverages states’ success in implementing demand response pilot programs, which can guard against price spikes for natural gas consumers and reduce the need to expand natural gas infrastructure.

“Incentives to use energy more wisely benefit everyone.  Customers save on energy costs, we get more out of our infrastructure, and less pollution ends up in our atmosphere to drive climate change,” said Whitehouse, a member of the Senate Environment and Public Works Committee.  “Utilities are already succeeding with these programs.  My new legislation will help spread that success around the country.”

Demand response programs compensate customers for cutting their energy use during times of high prices or when infrastructure reliability is threatened, like during a heat wave or cold snap.  Whitehouse’s bill would direct the Department of Energy to establish a pilot program allowing gas utilities, local distribution companies, and other stakeholders to develop demand response programs to provide greater flexibility in distributing natural gas.  It would also call on the Energy Department to study the benefits of and challenges to adopting demand response in the natural gas sector.

“We commend Senator Whitehouse for introducing this important bill.  For years, demand response has reduced carbon emissions and saved ratepayer dollars in the electricity markets, and it is time we used demand response to reduce carbon emissions and save money on the natural gas side as well,” said Jerry Elmer, Senior Attorney for the Conservation Law Foundation.

Natural gas demand response has the potential to reduce gas use significantly.  Preliminary analysis by the Brattle Group suggests a natural gas demand response program for heating homes in New England could save 40 million cubic feet of natural gas on a peak day—5 percent of the average power sector demand for gas in the region during the winter months. 

Full text of the Senator’s bill is accessible here.

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