Utility companies want to be able to make the demand go up and down just as much as the supply fluctuates.
This concept works with “smart” thermostats. When electricity demand is high, such as during a hot summer day, the utility can remotely adjust your thermostat’s air conditioning settings to raise the interior temperature setting by a degree or two – thereby reducing power demand.
Individuals can still reset it back down, if they wish.
The power utility has also experimented with a voluntary system where consumers without smart thermostats subscribe to email or text alerts asking them to adjust their electricity usage.
Electricity has to be created, in real time, as it is demanded by customers. Traditionally, this meant coal and natural gas fired production plants which can ramp up and down quickly (hydro dams are not adjustable in real time). In the new model, the power companies are looking at altering the demand – not just the supply – in real time.