Aggregating residential electricity customers decreases blackouts

By Rao Konidena Last week’s experience in California shows the impact of aggregated residential demand and the need to pay residential customers to reduce demand. California heat wave means high air conditioner usage leading to strain on the electric grid. Most state electricity policymakers focus on building more capacity or transmission to deliver that capacity but don’t pay enough attention to the demand side of the equation to reduce that strain. Heat waves should drive policymakers to include aggregated residential demand in wholesale market design discussions.

Unlike the warning from the North American Electric Reliability Corporation before summer, “heat events coupled with drought can

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