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Demand-Side Management

What is Demand Response?

Demand response is the voluntary reduction in power usage by customers during peak times. Energy usage usually starts increasing early morning, peaks in the afternoon, and tapers off early evening.  Actions taken to reduce non-essential power consumption can include dimming/shutting off lights, adjusting thermostat settings or, scaling back operations during peak hours.


Demand response does not include actions taken to reduce power consumption from normal operating practice or behavior (such as shutting down operations during holidays).


Compensation for Economic Demand Response

Traditionally, higher peak power consumption is offset by bringing online auxiliary (supporting) power generation units. This may include power generated through solar, wind, geothermal and other renewable energy sources. Similarly, economic demand response resources from peak load shavings help to supply the additional power needs, often replacing the need to operate additional power plants. Customers can bid their power consumption reductions into the energy markets and thereby, earn money for their energy use reduction. Compensation for economic demand response resources are based on wholesale energy market prices, similar to traditional supply resources.  


Benefits of Demand Response Programs

Demand response programs provide necessary load reduction and cost mitigation to all involved market participants including the load serving entities (LSEs, or utilities), small and large power users, as well as, generation and transmission system operators.

Benefits to Customers include:

  • Payments:  Electricity savings and incentive payments earned by customers for peak load shaving


  • Cost reduction: Lower wholesale prices from demand reduction programs make their way to retailers and eventually, to end-use customers


  • Reliability:  Reductions in likelihood of forced outages that cause inconvenience to customers


  • Improved choice: Ability of retail customers to manage costs even in states where retail competition (energy deregulation) is prohibited


Benefits to Utilities, Power Generators & Transmission Operators include:

  • Demand response programs help to smooth out the intermittent power supply from sources like wind and solar, keeping the grid in balance


  • Reduction in operation and maintenance costs for keeping additional power generators online


  • Avoids using less-efficient generation resources to meet high demand for power


  • System operators are provided with more flexible resources (e.g. registration & dispatch) to meet contingencies


  • Reduced emissions from high-polluting ‘peaking’ power plants


  • Local DR resources within states reduce dependence on outside supply


Our Process

Associated Renewable is a leading energy management solutions company that enables customers to participate in demand response programs directly or through curtailment service providers (CSPs) that act as agents.  Our team of experts works with business owners, property managers and all other energy users to create an effective demand response management plan.  We also provide power at competitive rates through our Energy Supply practice. To learn how we can help you reduce unnecessary power consumption and get compensated for energy reduction, contact our Energy Solutions team by phone at (212) 444-8215 or use this submission form.  

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Tuesday, February 14, 2017 - 13:01


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