PORTLAND (AP) – Maine Sen. Susan Collins has announced a series of efforts in Congress to promote what utility experts call demand response – the idea of letting electric customers react to changing prices, with the understanding that the cost of producing power varies at different times of the day.

These measures could have an impact in Maine, where residents pay above-average electric rates.

“Instituting demand response in our electricity markets is one area that shows considerable promise for reducing electricity rates,” Collins said.

The General Accounting Office is studying the potential of demand response. The results are due in March.

Collins said that in some pilot studies consumers were able to save $600 a year by shifting the time of day at which they used the most power.

There may also be clean air benefits. Cutting peak demand by just 5 percent could idle dozens of peak-demand power plants in the Northeast, most of which are more polluting than modern generators and cost three-to-10 times as much to run.

Collins also is co-sponsoring legislation to encourage utilities to offer demand response programs to consumers.

Together with Sen. Jeff Bingaman, D-New Mexico, she is offering an amendment to the Senate version of the federal energy bill to provide a $30 tax credit for “smart meters.” These high-tech electric meters let utilities record time-of-use data, so consumers can plan their energy usage.

Utilities in several states are experimenting with the idea of demand response. A spokesman for Central Maine Power Co. was unavailable to comment.

In states where demand response has been tried, results are mixed. Creating the specific market and regulatory conditions to make it work is difficult.

In the state of Washington, Puget Sound Energy created a time of use program in 2001, during the West’s highly publicized energy crisis.

More than 300,000 customers were put into a rate plan that was designed to save them money if they shifted their energy use away from peak times.

The program did cut energy use by 5 percent during peak hours. But unexpectedly, many customers in the time-of-use experiment paid more than their counterparts with traditional flat rates. By last fall, thousands of customers had quit the program. It was later suspended.

Electric rates in Maine have moderated in recent years, as energy and transmission services have been separated by the state’s restructuring law. CMP’s delivery charges have dropped on a schedule, but the region’s energy prices are more volatile.

AP-ES-07-07-03 0215EDT


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