Demand Response
A program where utilities pay customers to reduce electricity usage during peak demand events, often by cycling AC units, adjusting thermostats, or discharging batteries to the grid.
Why It Matters
Demand response programs can earn $50-200+/year for battery owners. Some virtual power plant programs pay even more for allowing the utility to dispatch your battery during grid emergencies.
Real-World Example
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Related Terms
Peak Demand
The highest rate of electricity consumption (measured in kW) recorded during a billing period. Commercial customers often pay demand charges based on their peak demand.
Battery Storage
A system that stores excess solar energy for use when the sun isn't shining, providing backup power during outages.
Time-of-Use (TOU) Rate
An electricity pricing structure where rates vary by time of day. Peak hours (usually 4-9 PM) have higher rates.