Businesses can make an immediate impact by better managing their energy costs. Demand, in terms of electricity, is the instantaneous consumption of electricity. Your usage is the sum of demands over a period of time. Demand management is the act of controlling, through various means, how and when you use your electricity.

Reduction in demand decreases need for investments in networks and/or power plants. The electricity infrastructure has to be built to serve the hypothetical peak demands of all customers plus a cushion. It’s like buying a car that holds four passengers because every year at Christmas you take your mom and dad to dinner. The remainder of the year it is just you and the dog. For 364 days a year a two-seater meets your needs. But because you need the extra seats that one day, you pay for a larger car, more insurance, and more gas. Now if the car were always full these costs on a per passenger basis might even be equal to the two-seat car on a per passenger basis. However since most of the time it is just one passenger, the cost per passenger is higher with the four-seat model.

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