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Demand Response Issue Paper for Fifth Power Plan
Council document 2002-18 |
December 2002
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Summary
This issue paper examines demand response in the retail market for
electricity. It begins by explaining why demand response is
important, why it has been deficient in the past, and how that deficiency
has become more serious with the current electrical industry structure.
The paper then explains that ?demand response,? as it is used here,
is not ?conservation? as the Council has used the term. It
discusses how the difference affects the kinds of policy goals we can
consider.
The paper describes and evaluates the main options for increasing
demand response. It begins with real-time pricing, which offers a
number of advantages in principle, but faces a number of obstacles that
rule out quick and widespread adoption. It examines time-of-use
pricing, which faces somewhat fewer obstacles and offers somewhat less
promise. The paper then moves to a number of forms of payment for
reductions in use, which have been adopted fairly widely in our region and
elsewhere. The payment for reductions options are more familiar and
enjoy more acceptance, but have transactions costs and limited participant
pools.
Next, the issue paper proposes to estimate the potential amount of
demand response in the region, and the value of achieving that potential.
Finally, the paper invites comments on the issue in general and some
aspects of the issue in particular.
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Comment on this report
[Comment period is past.]
Send comments by February 7, 2003 to:
Mark Walker
Director of Public Affairs
Northwest Power Planning Council
851 SW 6th Avenue, Suite 1100
Portland, Oregon 97204-1348
or email
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