Demand Flexibility in New York City Buildings

Demand Flexibility in New York City Buildings: Benefits beyond Carbon

Demand flexibility shows significant potential to reduce carbon emissions from the buildings sector, as RMI found in the report The Carbon Emissions Impact of Demand Flexibility. Demand flexibility is a building’s ability to shed or shift its energy demand from one time to another, based on near-real-time signals such as the price of electricity or the carbon intensity of the grid. With the right signal structure, laws such as New York City’s Local Law 97 (LL97) could enable demand flexibility, which has the potential to cut NYC building emissions by 40 percent or so as the grid approaches full decarbonization.

This insight brief, Demand Flexibility in New York City Buildings: Benefits beyond Carbon, builds on that analysis to show that demand flexibility offers benefits in addition to emissions reductions:

1. Demand flexibility reduces peak demand, providing health and environmental benefits
   Demand flexibility could reduce a building’s peak electricity consumption by 30 percent to 50 percent during specific hours, minimizing peaker plant reliance by limiting the system peak in the electricity grid. This, in turn, could reduce grid operational costs, avoid additional infrastructure costs, and provide health and environmental benefits to society.

2. Demand flexibility supports electrification that is beneficial for buildings and the grid
   Electrified buildings have more load that can be flexed, maximizing the potential benefits of demand flexibility. Combining electrification with demand flexibility also minimizes winter peaks.

3. Demand flexibility could unlock an additional cost-effective path to LL97 compliance via a time-of-use carbon metric
   Demand flexibility is an underutilized but vital decarbonization strategy. LL97’s use of a carbon metric that values the time at which electricity is consumed presents NYC building owners with an additional cost-effective pathway to compliance and decarbonization.

Limiting the global average temperature increase to 1.5°C will require every tool in the electricity grid’s arsenal. Demand flexibility provides significant potential in NYC to reduce carbon emissions, provide improved health and environmental benefits, and support cost-effective electrification and compliance with LL97. The insights in this brief will be valuable for New York City property owners and building managers, as well as buildings-sector stakeholders in utility, regulatory, and policymaking roles.