6 Demand Side
The smart grid gives utilities the ability to control electric demand to some extent.
Peak Clipping
Meeting peak usage is the most costly power that a utility can provide. Hence, utilities try to diminish peak usage periods as much as possible. This is known as peak clipping. For instance, customers with smart thermostats can earn a discount on their bill if they allow the utility to control the thermostats a few times a month during peak usage.
Load Shifting
In addition, utilities will try to move customer demand during peak usage to off-peak times this is known as load shifting. Examples of this would include electric car charging occurring outside of peak time period or a company with a large warehouse refrigerator or freezer cooling these units more substantially during off-peak periods. (Gellings 246)
Works Cited
Gellings, Clark W. The Smart Grid : Enabling Energy Efficiency and Demand Response. Fairmont Press, 2009.