Demand Response
Demand response is a mechanism where electricity consumers reduce or shift their power consumption during peak demand periods in response to utility signals, market prices, or grid reliability events. Participants are compensated through bill credits, capacity payments, or wholesale market revenues.
Demand response programs allow grid operators to balance supply and demand without activating expensive or dirty peaker plants. Participants — typically large commercial and industrial facilities — agree to curtail or shift load during designated events in exchange for financial compensation.
Types of demand response include economic DR (voluntary load reduction when prices are high), emergency DR (mandatory reduction during grid reliability events), capacity DR (standing commitment to reduce load if called upon), and automated DR (building management systems that respond to price signals without human intervention).
For corporate sustainability, demand response offers dual benefits: it reduces electricity costs and shifts consumption away from peak hours when the grid is typically more carbon-intensive. A facility that curtails 1 MW during a summer peak event avoids emissions from the marginal generator — often a natural gas peaker plant.
Gravity's energy management capabilities help organizations identify curtailment-eligible loads, estimate financial returns from program participation, and track actual performance during events — connecting demand response to both the energy cost and carbon accounting workflows.
Frequently asked questions
What is demand response? +
Demand response is a mechanism where electricity consumers reduce or shift consumption during peak periods in exchange for financial compensation. It helps balance the grid, lowers energy costs, and reduces emissions by avoiding dirty peaker plant generation.
Related terms
Energy Management
Energy management is the systematic monitoring, control, and optimization of energy consumption in an organization to reduce costs, improve efficiency, and lower carbon emissions. It encompasses utility bill tracking, real-time meter monitoring, anomaly detection, efficiency project planning, and incentive capture.
Energy Efficiency
Energy efficiency means using less energy to deliver the same service or output. In the context of carbon management, energy efficiency is the fastest, lowest-cost decarbonization lever because every unit of energy saved reduces both operating costs and greenhouse gas emissions simultaneously.
Scope 2 Emissions
Scope 2 emissions are indirect greenhouse gas emissions from the generation of purchased electricity, steam, heating, and cooling consumed by an organization. They are called 'indirect' because the emissions physically occur at the power plant or utility, not at the reporting company's facilities.