Texas Commission Adopts New Rules to Improve Residential Demand Response

The Public Utility Commission of Texas on Dec. 12 established new rules to improve demand response for residential electricity consumers through smart responsive device programs. The new rule implements legislation enacted by the 88th Texas Legislature in 2023, which sets a target to decrease the total power consumption of customers participating in residential demand response programs by 20 percent.

The new rule also creates new reporting requirements which provide the commission and the Electric Reliability Council of Texas (ERCOT), key information on the performance of demand response programs. The rule also ensures that the programs do not negatively affect residents who have chronic health conditions or are under critical care.

Smart responsive devices strategically manage electricity demand and minimize energy waste. A smart thermostat, for example, automatically adjusts the temperature so that the home is heated only when needed by the customer. These devices in demand response programs enable lower energy consumption during times of high electricity demand. This system allows a more even distribution of electric load, less waste, and lower energy bills for residents. Currently, retail electric providers in Texas incentivize their customers to participate in voluntary demand response programs and install smart responsive devices.

Demand response programs are crucial in improving grid reliability and effectively managing electricity demand. Measures to balance supply and demand, enhance reliability, and support grid flexibility have gained increased importance in the face of increasing electricity demand and extreme weather conditions. Last year, ERCOT stated that demand response programs are one of the most effective tools in improving grid reliability, particularly in the case of extreme weather events that Texas has been experiencing.