Demand response is the largest underutilized reliability resource in North America. Historic demand response programs have focused on reducing overall electricity consumption (increasing efficiency) and shaving peaks but have not typically been used for immediate reliability response. Many of these programs have been successful but demand response remains a limited resource. The Federal Energy Regulatory Commission (FERC) report, 'Assessment of Demand Response and Advanced Metering' (FERC 2006) found that only five percent of customers are on some form of demand response program. Collectively they represent an estimated 37,000 MW of response potential. These programs reduce overall energy consumption, lower green house gas emissions by allowing fossil fuel generators to operate at increased efficiency and reduce stress on the power system during periods of peak loading. As the country continues to restructure energy markets with sophisticated marginal cost models that attempt to minimize total energy costs, the ability of demand response to create meaningful shifts in the supply and demand equations is critical to creating a sustainable and balanced economic response to energy issues.
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