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Indian Power Sector increased from 30,000 MW in 1981 to 100,000 MW in 2001.

Despite growth in Supply, Struggling to overcome Chronic Power shortages & poor quality power. With Demand exceeding Supply, Severe peak & energy shortages continue to plague sector. Inefficiencies due to: Irrational Tariffs, technological obsolescence of industrial processes & equipments, lack of awareness & inadequate policy drivers in India. Elementary problem faced by power sector is Poor Financial conditions of State Electricity Boards (SEBs). Major problem is the negligence of DSM opportunities in India.

Demand Side Management (DSM) is the implementation of policies & measures which serve to control, influence and generally reduce electricity demand. DSM aims to improve final electricity using systems, reduce consumption, while preserving the same level of service and comfort. The goal of DSM is to encourage the consumer to use less energy during peak hours, or to move the time of energy use to off peak times such as night time & weekends.

Reduction in Customer energy bills. Reduction in the need for new power plant, transmission & distribution network. Creation of long term jobs due to new innovations & technologies. Reduction in air pollution. Reduced dependency on foreign energy resources. Reduction in peak power prices for electricity.

There are basically two main motives of Demand Side Management. They are :

(i) Cost reduction and environmental motives. (ii)Reliability and network motives.

Energy saving measures can be carried out such as efficient heating systems, appliances, lighting and insulation. DSM measures can reduce consumer energy costs. Measures require little or no implementation cost. Often any implementation cost is passed on to consumers, for example, by the utility in the form of higher tariffs. Actions taken to avoid new infrastructure development. Energy efficiency systems, distributed co-generation using gas, solar power will bring environmental benefits.

Network constraints are becoming a problem in both developing and developed countries, where demand increasing & network infrastructure becoming inadequate. In many situations, network driven DSM can delay the need for network expansion and augmentation.

It may be able to eliminate cost effectively the requirement to build a large scale distribution network.

The main types of DSM activities may be classified into three categories:

ENERGY REDUCTION PROGRAMS- reducing demand through more efficient processes, buildings or equipments.
LOAD MANAGEMENT PROGRAMS- changing the load pattern and encouraging less demand at peak times and peak rates. LOAD GROWTH & CONSERVATION PROGRAMS.

This category covers large no. of measures in all sectors. Here are some examples: BOILERS: production of steam and hot water is a major activity in all industrial processes. However, poor boiler operation represents a significant source of energy losses.

LIGHTING: often consuming 10 % or more of industrial plant electricity or 50% or more in commercial buildings, lighting normally offers good opportunities for savings.
MOTORS & DRIVE SYSTEMS: may consume over 50% of the total electricity used. Poor motor performance is typically a major source of loss.

COMPRESSED AIR SYSTEMS: often a significant user of electricity in an industrial plant, frequently lack meters and suffer poor maintenance . HOUSEHOLD: no cost or low cost measures. if no action has been previously taken on simple energy saving measures, there may be large saving opportunities available for very low cost.

It involves the technique of changing the load pattern and encouraging less demand at peak times and peak rates. Few methods are: PEAK CLIPPING: where the demand peaks are clipped and the load is reduced at peak times. This focuses on reducing the peak demand. VALLEY FILLING: where the low demand periods are filled by building off peak capacities. This form of load management can be achieved by thermal energy storage that displaces fossil fuel loads. LOAD SHIFTING: where loads are shifted from peak to valley times

PRIVACY: costumers have to provide some information about the usage of electricity. Some people argue that DSM has been ineffective as measures have resulted in higher utility cost for consumers and less profit for utilities. In developing countries there is generally a low awareness of energy efficiency and DSM programs, and therefore marketing is necessary to promote these. Knowledge and understanding of DSM systems and opportunities.

DSM is an important tool for enabling the more efficient use of energy resources available to a country. DSM applied to electricity systems can mitigate electrical system emergencies, minimize blackouts and increase system reliability, reduce energy prices, provide relief to the power grid and generation plants, defer investments in generation, transmission and distribution network and contribute to lower environmental emissions. It is therefore important to market DSM programs to show potential costumers their life cycle benefits and the techniques for reducing demand.