How Demand Response Works

A worker monitors electrical systems at the Geysers power plant in Santa Rosa, Calif. See more pictures inside a nuclear power plant.
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­When you turn on an appliance, you expect immed­iate results: You don't wait for a light bulb to come on after you've flipped the switch. Electricity isn't stored in a tank in your yard, so when you need it now, how does it deliver? That's the power grid at work. Electricity is generated at a power plant and transmitted to local substations where transformers turn it into a usable voltage. Then it's distributed into our homes and businesses through a web of high voltage transmission lines -- the grid.

From day to day, electricity consumers use a predictable minimum amount of power, called the baseload. At the very least, the grid needs to handle this scheduled energy production, in addit­ion to any usage spikes that happen. Demand for electricity is typically highest in the afternoon and early evening, as well as during the summertime when air conditioners run day and night. When many people want to use their electrical appliances at the same time it's called peak usage time.

Until your power is knocked out, you probably don't pay much attention to how often you turn on a light or the television or what time of day you do it. When you flip on a light switch, electricity travels in an instant to your home and the bulb glows -- that's called demand. When millions of electricity customers all turn on their air conditioners after work, it increases the dem­and load on the grid. Our demand for electricity is growing and the Energy Information Administration estimates that demand will rise at least 40 percent by 2030 [source: EEI].

­The power grid supplies only the electricity we ask for, though, and it's up to us to practice energy conservation. One way to decrease the demand load is a concept called demand response. In broad terms, demand resp­onse programs give us -- residential, commercial and industrial consumers -- the abi­lity to voluntarily trim our electricity usage at specific times of the day (such as peak hours) during high electricity prices, or during emergencies (such as preventing a blackout).

Let's look at the impact of demand response on the energy industry, the power grid and the environment.