What is demand response:
Demand response is a program that pays consumer to cut down their usage of energy. This means that instead of adding generation to a system, they can keep everything the same since consumers agreed to use less energy within a certain time period. Utilities usually pay for demand response capacity because its is generally cheaper and easier to obtain than traditionally generation. Participants in demand response programs are paid because they provide to demand response capacities. It is simple things that are used to help in these programs. For example shutting off lights, air conditioners, pumps, and any other non-essential equipment.
Demand response programs:
Price-based demand response: This gives costumers time-varying rates that reflect the value and cost of electricity in different time periods. Costumers tend to use less energy during times when electricity prices are higher.
Incentive-based demand response: This program pays participants to reduce their energy use when the program tells them to. It is usually triggered when electricity is high in prices and/or during a peak in demand.
Benefits of demand response:
- Price/cost
- Efficiency
- Decrease peak demand
- Reliability
sources:
http://www.pge.com/mybusiness/energysavingsrebates/demandresponse/
http://www.enernoc.com/our-resources/term-pages/704-what-is-demand-response
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