Whatever you want to call it, load management, load control or interruptible power, the idea is the same and it can offer some savings worth considering.
The idea behind these programs is the electric company has the authority to reduce their peak demand. Utility companies have do build for peak demand; therefore, the lower their peak demand, the fewer power plants they need. One way to minimize the peak demand is to offer incentives for some customers to cut back on electrical use during peak periods.
On the residential side, load control is usually wired into the large electric appliances such as hot water heaters and air conditioning. During peak periods (middle of the day on a hot summer heat wave, for example) the utility company can automatically switch these appliances off for a period of time. This isn’t usually a problem for most people because they are at work and school and don’t know the difference. The utility company knows the difference though, because they get to lower their peak generating load.
On the industrial side, load control works much the same way with much larger benefits to the utility company. One industrial site can easily consume the power of hundreds of households. The utility company recognized this and is willing to offer industry a larger incentive to sign up for this program. Most industrial plans don’t offer automatic load reductions. A company typically determines the minimum electrical load they will need (office air conditioners, computer rooms, minimal lighting, etc). The utility company will then require the company to manually adjust at or below the contract amount.
For a residential customer, the savings aren’t huge, usually around 3% reduction in rate or a fixed rebate each month accounting to this amount. However, for industrial customers the rate reduction can be 10% or more depending on the utility company.
Load control helps the customer save money for the promise of reducing load. It helps the utility companies reduce cost in not having to construct larger plants. This is a win-win arrangement for customers, utility companies and the environment.