"Demand response is clearly the 'killer application' for the smart grid"

Demand response and advanced metering programmes have made significant progress in serving more consumers across the country, according to a new report released by Federal Energy Regulatory Commission (FERC).

The report, 2008 Assessment of Demand Response and Advanced Metering, while notes progress on overcoming regulatory and financial hurdles over the past three years, also points to continuing obstacles – the limited number of retail customers on time-based rates, restrictions on customer access to meter data and the scale of financial investment necessary to deploy enabling technologies during an economic downturn – that could limit opportunities for continued growth in these programmes.

According to FERC Commissioner Jon Wellinghoff, who leads the Commission's efforts in the Collaborative Dialogue on DR with the National Association of Regulatory Utility Commissioners, DR is clearly the 'killer application' for the smart grid.

"With our FERC report gauging progress and identifying continuing barriers to demand response, we can effectively assess our progress in deploying essential smart grid technologies," said Wellinghoff.

The report's conclusions are based on a survey that shows the ratio of advanced meters to all installed meters has reached 4.7 percent for the US, a significant jump from the less than one percent in 2006. The report is FERC's third annual report on DR issues.

On the demand response side, eight percent of energy consumers in the US are in some kind of DR programme and the potential DR resource contribution from all such US programmes is close to 41,000 megawatts, or 5.8 percent, of US peak demand. This represents an increase of about 3,400 MW from the 2006 estimate. The largest DR resource contributions are from the Mid-Atlantic, Midwestern and Southeastern regions of the US. The report also notes that in the past year, Colorado, Maryland, Ohio and other states promoted DR through utility regulation legislation. Alabama and California led states in approving time-based rates for consumers. And multi-state groups from the Mid-Atlantic to the Pacific Northwest are coordinating across jurisdictions to enhance DR through research, education and planning.