Skipping Stone logo

facebook  linkedin  twitter

Programs and Participation


Articles, Presentations & Reports

Demand Response Basics Back to the Library Back to Skipping Stone


Commercial and Industrial consumers participate in Demand Response through program providers, such as utilities, Independent System Operators (ISOs), Curtailment Service Providers(CSPs) and Regional Transmission Organizations(RTOs). Several types of programs are offered by some or all of these program providers.

There are basically three ways for consumers to implement DR: 

Demand Response Process Flow

1. DR event notice sent via text, phone call or email
2. Decision to participate is made by a person.
3. DR measures are initiated by people on site and limited to manually adjusted components such as light switches, thermostats, etc.

1. DR event notice sent via text, phone call or email
2. Decision to participate is made by a person.
3. Preprogrammed DR measures are initiated by a person at a workstation.

1. DR event notice sent over the internet or private network.
2.Preprogrammed DR measures are initiated through automation.
3. In some cases meter feedback is provided.

Demand Response Program Types

Program types are classified and defined below according to FERC, NERC and USGBC criteria; however, definitions used by the individual program providers may vary based on regional differences.

Demand Response Program Types and Definitions

Program Type Program Definition
 Direct Load Control
 (LEED Qualified)

Program sponsor remotely shuts down or cycles a customer’s electrical equipment, e.g. air conditioner, water heater, lighting, on short notice. Primarily offered to residential or small commercial customers.
 Interruptible Load
 (LEED Qualified)
Electric consumption is subject to curtailment or interruption under tariffs or contracts that provide a rate discount or bill credit for agreeing to reduce load during system contingencies. Demand reduction may be effected by action of the System Operator, called 'remote tripping,' after notice to the customer in accordance with contractual provisions.
 Critical Peak Pricing (CPP) with  Direct Load Control
 (LEED Qualified)
Combines direct load control with a pre-specified high price for use during designated critical peak periods triggered by system contingencies or high wholesale market prices.
 Load as a Capacity Resource
 (LEED Qualified)
This customer commits to making pre-specified load reductions when system contingencies arise.
 Spinning Reserves
 (LEED Qualified)
Demand-side resources synchronized and ready to provide solutions for energy supply and demand imbalance within the first few minutes of an Emergency Event.
 Non-Spinning Reserves
 (LEED Qualified)
Demand-side resources that may not be immediately available, but may provide solutions for energy supply and demand imbalance after a delay of ten minutes or more.
 Emergency DR
 (LEED Qualified)
Provides incentive payments to customers for load reductions achieved during an Emergency Demand Response Event.
 Regulation Service
 (LEED Qualified)
A type of DR service in which a Resource increases and decreases load in response to real-time signals from the system operator. Resources providing Regulation Service are subject to dispatch continuously during a commitment period. This service is usually responsive to Automatic Generation Control (AGC) to provide normal regulating margin. Also known as regulation or regulating reserves, up-regulation and down-regulation.
 Demand Bidding and Buy Back
 (LEED Qualified)
Program which allows a Demand Resource in retail and wholesale markets to offer load reductions at a price, or to identify how much load it is willing to curtail at a specific price.
 Peak Time Rebate
 (LEED Qualified)
Allows customers to earn a rebate by reducing energy use from a baseline during a specified number of hours on critical peak days. Like Critical Peak Pricing, the number of critical peak days is usually capped for a calendar year and is linked to conditions such as system reliability concerns or very high supply prices.
 System Peak Response  Transmission Tariff
 (LEED Qualified)
The terms, conditions and rates and/or prices for customers with interval meters who reduce load during peaks as a way of reducing transmission charges.
 Real-Time Pricing In these rate and price structures, the retail price for electricity typically fluctuates hourly or more often to reflect changes in the wholesale price of electricity on either a day-ahead or hour-ahead basis.
 Critical Peak Pricing The rate and/or price structure designed to encourage reduced consumption during periods of high wholesale market prices or system contingencies by imposing a pre-specified high rate or price for a limited number of days or hours.
 Time-of-Use Pricing (TOU) Usage unit prices vary by time period where the time periods are typically longer than one hour within a 24-hour day. Time-of-use rates reflect the average cost of generating and delivering power during those time periods.

© 2016, All Rights Reserved.