California has opened its electricity markets to demand response — the business of turning down electricity use to help utilities manage peak power demand — in a big way. The state’s grid operator announced its new Proxy Demand Resources (PDR) program yesterday, one of the first efforts to give “negawatts” an equal footing with megawatts in power markets. Under the new regime, demand response providers bid their power reductions into day-ahead and real-time markets at prices that compete directly with bids by power plants and other providers of real power. The Federal Energy Regulatory Commission wants grid operators around the country to open up their power markets to demand response in the same way, and that could mean opportunities for big DR providers such as Comverge and EnerNoc — or, perhaps, new energy players like Google? Check out my article at Earth2Tech for more details.