The Economics of Conservation Programs

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Demand side management (DSM) focuses on energy conservation and peak load reduction through measures financed by electric utilities for various sectors, including households and industry. Originating from the Public Utility Regulatory Policy Act of 1978, DSM aims to establish energy conservation as a national goal, prompting regulatory commissions to create utility conservation programs. The 1992 Energy Policy Act further emphasizes integrated resource planning, mandating that DSM be considered alongside supply. Implementation varies by state, leading to significant differences in conservation efforts and regulations.