The role of regulatory reforms, market changes, and technology development to make demand response a viable resource in meeting energy challenges

Abstract

In recent years, demand response and load control automation has gained increased attention from regulators, system operators, utilities, market aggregators, and product vendors. It has become a cost-effective demand-side alternative to traditional supply-side generation technologies to balance the power grid, enable grid integration of renewable energy, and meet growing demands for electricity. There are several factors that have played a role in the development of demand response programs. Existing research are however limited on reviewing in a systematic approach how these factors work together to drive this development. This paper makes an attempt to fill this gap. It provides a comprehensive overview on how policy and regulations, electricity market reform, and technological advancement in the US and other countries have worked for demand response to become a viable demand-side resource to address the energy and environmental challenges. The paper also offers specific recommendations on actions needed to capture untapped demand response potentials in countries that have developed active demand response programs as well as countries that plan to pursue demand response.