Demand response

“Demand Response,” is defined by FERC as changes in electric usage by demand side resources from normal consumption patterns in response to: (1) changes in the price of electricity over time, (2) or incentive payments designed to promote lower electricity use at times of high wholesale prices or during times when system reliability is jeopardized.

Demand response can provide some of the services traditionally provided by generation resources in energy, capacity, and ancillary market segments. Demand response is expected to play an active role in the future energy grid.

Features and Benefits

• More efficient operations resulting in lower prices and cost savings for customers
• Deferred capital expenditures in generation, transmission, and distribution
• Reduced system-level operating costs of generation, including fuel, start-up, O&M, and generation cycling costs
• Reduced T&D losses and lower congestion costs
• Increased reliability, lower outages, and lower ancillary services costs related to renewable energy (wind & solar) integration
• Expected lower criteria pollutants and greenhouse gas emissions

Applications

• Event responding demand response for utilities and electricity customers
• Price responding demand respond for utilities and electricity customers
• Demand response participation in ISO/RTO energy market segments
• Demand response participation in ISO/RTO capacity market segments
• Demand response participation in ISO/RTO ancillary services market segments