‘Demand Response’ , in two words, is ‘energy management.’ It means calculating the amount of energy a society needs based on projection, predictions and needs, and then arranging to make sure everyone has enough. For example when everyone goes home at 6 o’clock and turns on the air conditioners and cookers, there is going to be a sudden increase in electricity demand.
Demand Response manages peak electrical demand providing incentives to utility to customers to reduce load on demand.
Demand response has it origins in rather simple minded programs of the late 70’s, such as receiving a discount to let the power company turn off your home water heater each afternoon when more electricity is regularly required than the grid can provide. Today, such static programs are being replaced with dynamic systems to request such a response only when needed. DR programs range from providing the compliant customer a reduced rate at all times to support automated DR others allowing opt-in and providing direct payments tied to the size of the response.
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