Common failures of demand response

Demand response (DR) programs have recently become popular means of mitigating excessive claims on regional electricity networks and providing more reliable access to electric power. Many countries have experimented with DR pilot programs and some are beginning to incorporate similar schemes as permanent elements of the electricity sector. However, DR remains an experimental technique in much of the world as programs frequently fail to meet their goals and reach their potential. This paper examines the central structural and behavioral obstacles to success of DR programs and outlines some potential solutions which could greatly improve the functionality and success of such programs in the future.

Research highlights
► We identify main structural and behavioral obstacles to success of demand response.
► DR can smooth transition from regulated to competitive markets, improve efficiency.
► Lack of information about electricity use prevents consumer behavior change.
► Availability and cost of technology slow down spread of demand response programs.
► Broad restructuring activity often incompatible with existing DR programs