Load Shedding

Load shedding was implemented to save money. It also saves pollution.

Load shedding is what electric utilities do when there is a huge demand for electricity that exceeds the generation available. The alternative is to have a brown-out where the voltage is reduced.

It costs a lot to have generators standing by just in case there is a surge of demand, and the operators of those generators expect to be paid whether they run the generators or not. An alternative is if there is a large consumer of electricity (say, a factory) that could suddenly turn off all its electricity demand, they could agree to do that on request, and it has the same benefit as adding that amount of generation to the electric grid. In fact, it's better -- as there is less demand on the wires which are often saturated at the same time.

That factory has losses from shutting down its equipment and idling its workers, but if the money it gets paid is enough, then it's worth it. This is a perfect example of load shedding.

There are many other cases where lots of smaller consumers agree to reduce demand on hot summer days, such as by reducing air conditioning or lighting.

Someone who aggregates all these smaller cases can have the same effect as one big generator and so get the same money, and the operators of the electric grid are happy as it effectively solves the peak demand problem.

Pollution can be reduced by load-shedding as well. Often, the generators that you run as a last resort are the least efficient and most polluting. If you don't need to run those because you saved energy elsewhere for the few hours of highest power demand, we all win.