Demand Response

What is Demand Response?

Sydney Hughes blog author Sydney Hughes
Demand Response

Severe weather events have become increasingly prevalent from increased flooding to higher seasonal temperatures. During the summer and winter months, these temperature extremes induce a greater need for air conditioning and heat. This increases stress on the power grid, which challenges utilities to satisfy demand. Left unchecked, this strain on resources results in high energy prices and blackouts. A type of demand flexibility initiative, demand response (DR) programs address grid congestion and energy insecurity as a community-led conservation project.

To meet the needs of the grid, utilities activate what is known as peaker plants to try and meet needs. Peaker plants are expensive to maintain, have limited long-term utility, and increase the carbon output that further damages the environment. Fortunately, the combined efforts of utilities and individuals can help mitigate the need for peaker plants through demand response.

The History of Demand Response

In 1977 the first DR program was piloted by the Department of Energy with the city of Port Angeles, Washington focusing on load control. After a drought in the northwest, the BPA and the U.S. Department of Energy partnered with the local utility to find an efficient and affordable solution to looming power outages. That pilot sparked interest in other regional utilities, who, within a decade, began implementing their demand response programs. Many of these programs started focused on reducing peak demand using water heaters to help voltage reduction. Some are still successfully operating to this day. Today’s DR programs utilize many different device types of BYOD strategies, most commonly as they relate to heating and cooling units.

What is Demand Response?

Demand flexibility is any program that mitigates usage through conservation measures. In specific, demand response is a collective conservation effort that minimizes grid drain during times of peak usage by limiting access to specific, energy-hungry devices. Peak hours of usage vary slightly per region but tend to spike during evenings when more people are at home. Because the grid must always remain in balance, demand response is designed to mitigate these increases in usage by turning off high consumption devices like HVAC units or water heaters at their source. Failure to balance the grid can result in power outages or brownouts. Additionally, to meet demand, some utilities are moved to purchase energy to avoid outages, which in turn cuts into revenue and has the long-term potential to drive up rates.

Demand flexibility is any program that mitigates usage through conservation measures. In specific, demand response is a collective conservation effort that minimizes grid drain during times of peak usage by limiting access to specific, energy-hungry devices.

Running parallel to these programs,  distributed energy resources (DERS) is a variety of energy resources and green technologies that produce or store electricity independent of the power grid. DER technologies include energy storage systems, wind turbines, solar panels, cogeneration, and more. DERS can serve as another stopgap in minimizing outage events.

How DR Works

Every demand response program requires customer enrollment. There are a variety of enrollment types for customers, including enrolling qualified, Wi-Fi-enabled smart devices or placing a control device directly on the targeted appliance. Enrolled customers are provided an incentive, often in the form of a recurring credit during times that the program may be employed. During DR events, utility companies will cut off enrolled devices, which frees up resources for the grid. This is a form of utility load management, which is the act of controlling electricity consumption by balancing the supply of electricity on the power grid. DR programs can push behavioral, process, and equipment changes to help control when electricity is being used.

When and Where Are DR Programs Utilized?

Demand response programs are utilized during peak times of usage. These events are activated depending on if the grid reliability is challenged. Because these events occur in relation to environmental changes, they typically occur during the temperature extremes which are most commonly experienced in the summer or winter months. Before any events, utilities engage customers to alert them of the upcoming window without access to their enrolled device.

Why DR Matters?

Demand response is an integral component in making the power grid more efficient while lowering the cost to provide electricity. While the Earth has had many events that altered the environment, carbon dioxide generated by people has increased 250 times faster than in the time that led up to the last ice age. Left unchecked, climate change has the potential to radically change the world, with temperatures rising, increased flooding, and higher occurrences of extreme weather. As a part of a concerted conservation effort, these programs are a way to unite communities to slow the approach of climate change.


The strategies for demand response programs continue to evolve both to match the technology and to engage and encourage enrollment in customers. In 2019, DR programs in the U.S. saved nearly 1.1 terawatt-hours of power generated for the residential sector alone. For perspective, the U.S. used about 3.8 trillion kilowatt-hours in 2020, or around 3800 terawatt-hours. Fortunately, these programs are expected to grow from our current 29% to 60% by 2030. The more you know about demand flexibility now, the quicker we can collectively reach those goals.

Learn How To Work Toward a Greener Tomorrow


About The Author
Sydney Hughes blog author

Sydney Hughes is a motivated and hardworking college graduate who brings value to a collaborative marketing role opportunity. She has a passion for social media content and wants to have a positive impact on a marketing team. She recently graduated from the University of Alabama with a Bachelor’s in Marketing and is now part of the Virtual Peaker team as a marketing intern.

More About Sydney

Subscribe to our blog

Get the latest DER thought leadership, tips, and best practices in your inbox!

Yes, I would like to receive Virtual Peaker blogs as well as marketing communications regarding Virtual Peaker products, services, and events. I can unsubscribe at any time.