what is energy demand management?

Answer 1

I guess you are talking about a program some utilities have where they give you a price break on electricity if you let them attach a device that they can use to turn off you air conditioner if the load on the grid is too high. They say they will only turn any one person's off for 15 minutes at a time.

Answer 2

Utilities have a wide variety of techniques to manage energy demand. For instance...

Large industrial users of energy (like aluminum smelters) can sign interruptible supply contracts with utilities and receive lower rates for power. When demand is high, companies with these contracts cut back or eliminate energy consumption, and the utility can meet the demand of other users. Disruptive to the industry, but a worthwhile alternative.

As mentioned above, a residential variation of this is the radio-controlled switch on the air conditioner. I have one of these. During the summer months, I get $10/month off my power bill, and the utility can shut off my biggest source of electricity consumption for 15-30 minutes. With enough people signed up for this plan, the utility can "shed" peak load by doing a "controlled rotating brownout".

In emergency conditions where energy demand is more than a utility can meet, the utility will simply have brownouts, where it shuts off all power to a small sector for a short time, then rotates the outage to another area. This is quite disruptive, so utilities have devised less extreme ways to manage load.

Finally, utilities can always have public campaigns to reduce energy demand, for instance by encouraging conservation and shifting consumption to off-peak times, giving away CFLs or selling them at discounted prices, encouraging homeowners to get energy audits done, etc. Many critics of power utilities think much more of this should be done before power companies are allowed to build new power plants.