ORIGINAL REPORTING: The New Demand Response And The Future Of The Power Sector

The new demand response and the future of the power sector; Utilities and system operators can do more than lower load with demand response.

Herman K. Trabish, Dec. 11, 2017 (Utility Dive)

Editor’s note: The role of Demand Response continues to grow and policymakers are pushing for new rules from regional grids to open more opportunities.

Demand response (DR) was once an uncertain offer from a few big power users and residential customers to reduce load when notified by utilities or transmission system operators (TSOs). But there are now more than 13,600 MW of DR enrolled by utilities and about as much available to TSOs. Utilities reliably dispatched 78% of enrolled DR capacity — almost 10,700 MW — in 2016. DR's role is expanding and its identity is changing. It is now “reductions, increases, or shifts” in load, according to the “2017 Utility Demand Response Market Snapshot", released in October by the Smart Electric Power Alliance (SEPA) and Navigant Research. Those load changes allow utilities and TSOs to respond to “time-varying changes in the cost of producing energy, shortages of distribution, transmission, or generation capacity, or unusually high or low voltage or frequency,” the paper reports.

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Furthermore, the new DR, which incorporates a new toolbox of distributed energy resources (DER), is increasingly being used by TSOs as a market product alongside generation, according to “Demand Response; U.S. Wholesale DER Aggregation, Q3 2017” from GTM Research. Some TSOs now offer capacity market, emergency response or ancillary services opportunities for DR, the quarterly update reports. But MISO, PJM and NYISO have joined CAISO and ERCOT in evaluating how system operators can take advantage of aggregated DER-as-DR. As TSOs open their markets to aggregated DER-as-DR, its use to meet generation shortfalls caused by network congestion or capacity limits is growing, GTM Research reports. It is being delivered by industrial, commercial and residential customers through both utilities and private sector providers… click here for more

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