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How Load Shifting Moves Energy Consumption from Peak Demand Times

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One of the essentials of power system management centers on load management or the oversight of electricity consumption. Also known as demand side management (DSM), it often involves following financial signals provided by the market in allocating and distributing electricity to consumers at specific times. Load management underlies the smart grid, in which infrastructure has real-time flexible control measures and monitoring in place, which allocate resources depending on demand.

Load shifting also scales the load a company utilizes up or down depending on demand and external pricing signals. When demand is high in a peak load period that reflects high power consumption, the company can reduce its consumption. This does not mean it will consume less in a day; instead, it shifts the load or the time the business consumes electricity.

This strategy helps contain costs and is particularly vital for electricity consumers who want to increase their exposure to renewable energy plants. The lower costs associated with energy sources such as solar and wind reflect an inherent volatility that requires flexibly staggered energy allocations. It's worth noting that load shifting is distinct from load shedding, with the latter involving a targeted decrease in the total electricity consumption rather than a shifting of the time at which power is delivered.