These 2010 Demand Response (DR) Cost-Effectiveness Protocols (2010 Protocols) provide a method for measuring the cost-effectiveness of demand response programs. These protocols are intended for ex ante evaluations of demand response programs which provide long-term resource value.
These protocols have been developed with the understanding that DR is in a transitional period. Historically, DR was largely employed for reliability purposes during system emergencies in the form of interruptible programs for large industrial customers, which could be triggered when the California Independent System Operator (CAISO) would otherwise have to shed load during a system emergency or when a utility was faced with a serious distribution system emergency. However, the deployment of advanced metering technology and development of new energy markets is enabling greater use and flexibility of demand response by all types of customers. Increasingly, customers are able to manage their loads to provide different levels of load reduction in response to price signals or other incentives. These load reductions provide value to the grid not only during emergencies, but also during times of high energy prices or in the ancillary services market. As a result, the methods we use to measure the costs and benefits of demand response must be flexible enough to capture these emerging benefits.
This information was submitted by Jeremy Laundergan, Director, Utility Services Consulting, EnerNex, firstname.lastname@example.org on 08/31/2011.