A viral video showing a Colorado woman unable to turn down her air conditioning has sparked a new debate over smart thermostats and just how much control customers give utilities when they sign up for energy-saving programs.
The answer in Xcel Energy's case is yes — under certain circumstances, the utility can temporarily prevent participating customers from lowering their thermostats.
But there's an important piece of context missing from much of the social media discussion: Customers have to sign up for the program first.
The video circulating widely on X this week shows Kyri Baker, an associate professor of engineering at the University of Colorado Boulder, attempting to lower the temperature in her home during a stretch of extreme heat.
Her smart thermostat was set to 79 degrees.
“To conserve energy in your community due to stress on the regional energy grid, you cannot set your temperature to be lower,” a message on the thermostat read, followed by another notice stating, “Cannot be set lower.”
Baker is enrolled in Xcel Energy's AC Rewards program, which gives customers bill credits in exchange for allowing the utility to temporarily adjust their air conditioning when electricity demand is high.
Baker has said she understood why the utility was trying to reduce demand on the grid. Her frustration came from being unable to override the restriction, particularly while preparing to put her daughter to bed. She said customers should have an easier way to opt out in situations involving infants, elderly residents or people with health conditions.
The video quickly spread beyond Colorado, with some social media users portraying the incident as an example of utilities taking control of customers' homes.
The reality is a little more complicated.
Customers get paid to participate
AC Rewards is a voluntary program available to Xcel residential customers with central air conditioning and compatible Wi-Fi thermostats, including certain models from Nest, Ecobee, Honeywell and Emerson.
Customers get a $100 bill credit for enrolling and another $25 for each year they stay in the program.
In return, Xcel can temporarily adjust their thermostats when electricity demand spikes, generally during the hottest summer days. A typical event involves raising the cooling setting by 1 to 4 degrees for a limited period.
Most of the time, participants can override those adjustments.
There is an exception buried in what may be the most important part of the program's terms.
“You’ll have the ability to opt out of control events at any time and receive optional notifications of control events, either from your thermostat, mobile device, or web app,” Xcel states in its program description. “On rare occasions, system emergencies may cause a control event that cannot be overridden.”
It is that emergency provision that has attracted attention following Baker's experience.
Xcel has locked thermostats before
This isn't the first time Xcel customers have found themselves unable to override an AC Rewards event.
In 2022, approximately 22,000 participating customers had their thermostats locked during an energy emergency caused by high temperatures and a power plant outage.
The incident was described at the time as the first non-override event in the program's roughly six-year history.
Some customers complained afterward that they had not realized signing up for AC Rewards meant Xcel could temporarily prevent them from changing the temperature during an emergency. Some also reported indoor temperatures climbing into the 80s.
That episode raised many of the same questions now surrounding Baker's video, particularly whether customers understand exactly what they're agreeing to when they accept the bill credits.
Why Xcel wants control in the first place
For utilities, programs such as AC Rewards offer another way to deal with one of the electric grid's biggest headaches: huge spikes in electricity consumption.
During a heat wave, air conditioners across a region can switch on at roughly the same time. Electricity providers still have to meet that demand, even if the spike lasts only a few hours.
Turning up thousands of thermostats by a few degrees can take a noticeable chunk out of that peak.
Utilities say reducing those spikes can lower the risk of rolling blackouts and avoid firing up some of the more expensive backup generation used when demand is at its highest. Demand-response programs are also becoming more attractive as electricity consumption grows from data centers, electric vehicles and other large loads.
Instead of getting all of that extra capacity from another power plant, utilities can get some of it by temporarily cutting demand across thousands of homes.
For homeowners who participate, the $100 enrollment credit and annual $25 payment are compensation for giving Xcel that flexibility.
The controversy comes when customers discover exactly how much flexibility they agreed to give up.
Could the programs become mandatory?
Some of the posts amplifying Baker's video have warned that programs like AC Rewards may start as voluntary before eventually becoming mandatory.
There is no current evidence that Xcel plans to make AC Rewards mandatory.
Customers must affirmatively enroll in the program, and they can unenroll. Similar voluntary smart-thermostat programs operate through utilities and third-party providers in states including Texas, California, Arizona, Florida and Illinois.
Customers who don't participate aren't subject to AC Rewards thermostat adjustments.
That's an important distinction from the impression created by some of the viral posts. Xcel did not remotely take control of an unsuspecting customer's thermostat without her having agreed to participate in the program.
Baker had enrolled in AC Rewards and received the benefits that come with participation. The program's terms also disclose that rare grid emergencies can result in events that customers cannot override.
What her experience has exposed is a less dramatic, but probably more useful, question: How many people who sign up for a smart-thermostat rebate realize that “voluntary” participation can occasionally mean they can't change the temperature when they want to?
