The Brattle Group's white paper contains three illustrative proposals for achieving the state's DR potential. The first is a pricing standard that would make dynamic pricing the default tariff for all customer classes. The second and third proposals provide enabling technologies that would make it easy for customers to respond to dynamic pricing. They would mandate that programmable communicating thermostats be installed in all residential and small commercial and industrial buildings and that automated demand response software, which works with energy management and control systems, be installed in medium and large commercial and industrial buildings.
Ahmad Faruqui, a principal at The Brattle Group who led the research, noted that in the absence of standards, DR in California is likely to yield a drop of only three percent in the state's peak demand. Faruqui concluded, "With all three illustrative standards in place, a load drop of 15 percent becomes feasible. This would yield a reduction of $8.5 billion in the state's electricity costs over a 20-year horizon."
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