DRSG says FERC ruling a milestone for demand response

Washington, D.C., March 21, 2011 — The Demand Response and Smart Grid Coalition took the opportunity today to note that the past week included a major milestone for demand response. DRSG is the trade group of companies that provide demand response and smart grid technologies, products and services.

“It was a good week for DR,” said Dan Delurey, president of DRSG. “After exhaustive stakeholder input, and after extensive deliberation, the Federal Energy Regulatory Commission arrived at a decision — by a vote of 4-1 — saying that demand response is equivalent to generation and supply side resources and thus deserves equal compensation in wholesale energy markets.”

Delurey said that one of the issues that has long been there for demand response is whether it can be can a reliable resource in a portfolio that an RTO or utility assembles and manages to meet its needs. He said that the new ruling means that the commission has put forth a resounding “yes” to that question.

As for the economics of demand response, Delurey noted that FERC’s order ensures that all electric customers will benefit from an increase in demand response by only allowing demand response to receive full payment at times when doing so will provide overall cost reductions to all customers, passing the so-called “net-benefits test.”

“DRSG applauds FERC’s leadership to foster the growth of demand response and deliver its benefits to consumers,” said Delurey. “This is just the latest such step by the commission and we commend FERC for its efforts.”

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