Definitions

Demand Response

Demand response refers to the reduction of customer energy usage at times of peak usage in order to help address system reliability, reflect market conditions and pricing, and support infrastructure optimization or deferral. Demand response programs may include dynamic pricing/tariffs, price-responsive demand bidding, contractually obligated and voluntary curtailment, and direct load control/cycling.

Dynamic Pricing

Retail prices for energy consumed that offer different prices during different time periods and reflect the fact that power generation costs and wholesale power purchase costs vary during different time periods. Types include Time-of-Use Pricing, Critical Peak Pricing and Real-Time Pricing.

Time-Of-Use Pricing

Energy prices that are set for a specific time period on an advance or forward basis, typically not changing more often than twice a year (summer and winter season). Prices paid for energy consumed during these periods are pre-established and known to consumers in advance of such consumption, allowing them to vary their demand and usage in response to such prices and manage their energy costs by shifting usage to a lower cost period, or reducing consumption overall. The time periods are pre-established, typically include from two to no more than four periods per day, and do not vary in start or stop times.

Critical Peak Pricing

A type of dynamic pricing whereby the majority of kWh usage is priced on a TOU basis, but where certain hours on certain days where the system is experiencing high peak demand are subject to higher hourly energy prices that reflect market conditions for peak generation and delivery during peak demand periods. These critical period prices may be known to electricity customers under conditions such as “day-ahead” or “hour ahead” and are typically employed a limited number of times per year.

Real-Time Pricing

Energy prices that are set for a specific time period on an advance or forward basis and that may change according to price changes in the generation spot market. Prices paid for energy consumed during these periods are typically established and known to consumers a day ahead (“day-ahead pricing”) or an hour ahead (“hour-ahead pricing”) in advance of such consumption, allowing them to vary their demand and usage in response to such prices and manage their energy costs by shifting usage to a lower cost period, or reducing consumption overall.

Standard Meter

An electromechanical or solid state meter that cumulatively measures, records and stores aggregated kWh that is periodically retrieved for use in customer billing.

AMR

Automatic Meter Reading - system where aggregated kWh usage, and in some cases demand, is retrieved via automated means such as a drive-by vehicle, or walk-by hand-held system.

Interval Meter

A meter that measures and records kWh usage on either predetermined or remotely configurable time intervals, where the intervals are in increments such as minutes or hours.

Advanced Meter

An electric meter, new or appropriately retrofitted, which is 1) capable of measuring and recording usage data in time differentiated registers, including hourly or such interval as is specified by regulatory authorities, 2) allows electric consumers, suppliers and service providers to participate in all types of price-based demand response programs, and 3) which provides other data and functionality that address power quality and other electricity service issues.

Smart Meter

A different term used to refer to an advanced meter.

Advanced Metering Device

A separate electronic device coupled to a standard meter that enables it to function as and meet the definition of an advanced meter.

Retrofitted Meter

A standard meter that has had an advanced metering device added to it.

Advanced Metering or Advanced Metering System

A system that collects time-differentiated energy usage from advanced meters via a fixed network system, preferably two-way, on either an on-request or defined schedule basis. The system is capable of providing usage information to electricity customers, utilities and other parties on at least a daily basis and enables them to participate in and/or provide demand response products, services and programs. The system also supports additional features and functionality related to system operation and customer service, e.g. outage management, connect/disconnect, etc.

Advanced Metering Infrastructure

The communications hardware and software and associated system and data management software that creates a network between advanced meters and utility business systems which allows collection and distribution of information to customers and other parties such as competitive retail suppliers, in addition to the utility itself.

Emergency Demand Response Programs

Programs which are dispatched by system operators when system operating reserves drop to levels such that load reductions are needed to maintain short-term system reliability.

Economic Demand Response Programs

Programs which encourage demand reductions via price signals to energy users that reflect the higher costs of electricity production and delivery at times of system peak.

Load Management

A term used to refer to interruptible rates, curtailment programs and direct load control programs.

Direct Load Control

A system or program that allows utilities, other load serving entities, or demand response service providers to control user load via 1) directly cycling discretionary load of certain end uses, 2) directly turning off such loads or 3) implementing custom load control strategies that reduce peak usage.