Demand response resources: Who is responsible for implementation in a deregulated market?

Demand response resources (DRR) have potential to offer substantial benefits in the form of improved economic efficiency in wholesale electricity markets. Those benefits include better capacity factors for existing capacity, reductions in requirements for new capacity, enhanced reliability, relief of congestion and transmission constraints, reductions in price volatility, mitigation of market power and lower electricity prices for consumers. However, DRR has been slow to penetrate. There has been substantial disagreement as to which entities in a restructured market should promote the expanded implementation of DRR. This paper contends that no single entity can perform this function. But rather, wider implementation will need to accrue from coordinated actions along the electricity supply chain.