Electricity grids and peak demand response Demand response

the upper reservoir (llyn stwlan) , dam of ffestiniog pumped storage scheme in north wales

in electricity grid, electricity consumption , production must balance @ times; significant imbalance cause grid instability or severe voltage fluctuations, , cause failures within grid. total generation capacity therefore sized correspond total peak demand margin of error , allowance contingencies (such plants being off-line during peak demand periods). operators plan use least expensive generating capacity (in terms of marginal cost) @ given period, , use additional capacity more expensive plants demand increases. demand response in cases targeted @ reducing peak demand reduce risk of potential disturbances, avoid additional capital cost requirements additional plants, , avoid use of more expensive and/or less efficient operating plants. consumers of electricity pay higher prices if generation capacity used higher-cost source of power generation.

demand response may used increase demand during periods of high supply and/or low demand. types of generating plant must run @ close full capacity (such nuclear), while other types may produce @ negligible marginal cost (such wind , solar). since there limited capacity store energy, demand response may attempt increase load during these periods maintain grid stability. example, in province of ontario in september 2006, there short period of time when electricity prices negative users. energy storage such pumped-storage hydroelectricity way increase load during periods of low demand use during later periods. use of demand response increase load less common, may necessary or efficient in systems there large amounts of generating capacity cannot cycled down.

some grids may use pricing mechanisms not real-time, easier implement (users pay higher prices during day , lower prices @ night, example) provide of benefits of demand response mechanism less demanding technological requirements. example, in 2006 ontario began implementing smart meter program implements time-of-use (tou) pricing, tiers pricing according on-peak, mid-peak , off-peak schedules. during winter, on-peak defined morning , evening, mid-peak midday late afternoon, , off-peak nighttime; during summer, on-peak , mid-peak periods reversed, reflecting air conditioning driver of summer demand. of may 1, 2015, ontario electrical utilities have completed converting customers smart meter time-of-use billing on-peak rates 200% , mid-peak rates 150% of off-peak rate per kwh.