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Alternative-rate DSM program assistance

EIA Energy Glossary

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Alternative-rate DSM program assistance
A DSM (demand-side management) program assistance that offers special rate structures or discounts on the consumer's monthly electric bill in exchange for participation in DSM programs aimed at cutting peak demands or changing load shape. These rates are intended to reduce consumer bills and shift hours of operation of equipment from on-peak to off-peak periods through the application of time-differentiated rates. For example, utilities often pay consumers several dollars a month (refund on their monthly electric bill) for participation in a load control program. Large commercial and industrial customers sometimes obtain interruptible rates, which provide a discount in return for the consumer's agreement to cut electric loads upon request from the utility (usually during critical periods, such as summer afternoons when the system demand approaches the utility's generating capability).

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