Demand-Side Management Practices

The electric power system as driven by economic market forces experiences intensive utilization. To keep electric power systems continue to operate in a reliable and secured manner, resources aside from power generation are needed. Demand-side management has been taking its place in supporting power system operations and planning in the deregulated era. Significant reliability and financial benefits are derived in utilizing various forms of demand-side control.

Demand-side management or control types can be categorized in the order of contribution to power system security and electricity market efficiency.

• Time of Use Pricing (TOU) - this approach shifts power consumption from peak periods where the probability of high market prices and transmission congestion are obviously high and expected.

• Real Time Pricing (RTP) - this demand-side control strategy allows the load to reallocate energy utilization to lower market price hours and when power transmission usage is lower.

• Demand-side Bidding - this category assist the system operator for maintaining generation-load balance and in managing of zonal congestion. With this, it tends to lower the operating cost of the consumer and demand-side assists in alleviating generation resources shortage.

• Demand-side as Ancillary Services - demand-side is utilized as system reserves through emergencies especially when no other possible option provides solution to mitigate existing system-wide operating concerns. In this case, demand-side can be called to support the system operation as Responsive Reserve, Non-spinning Reserve, Regulating Reserve, or as a Replacement Reserve. Most often, the demand is reduced during periods of critical generation reserve margins and when electricity market prices are high due to generation shortage.

• Direct Load Control - this strategy employ the usage of automated control to reduce or curtail demand consumption during the occurrence of price spikes or during summer periods.

• Interruptible Load Program (ILP) - demand is reduced or cut-off from the grid to maintain secured system operation during emergencies where system continuous service can be put at risk. Some system operators utilize interruptible load for economic benefits and eliminating system operating constraints.