This report for the Federal Energy Regulatory Commission in the U.S. fulfills a Congressional mandate to explore the potential benefits of electric demand response. Under a scenario of full participation, the projected growth over 10 years in peak consumption could be reduced by about 20% for no net gain in the peak. Possible demand response programs range from limited to advanced programs that include dynamic power pricing and wide deployment of advanced metering infrastructures. The greatest impact of demand response is in regions that use a lot of air-conditioning. Demand response techniques need to be studied, coordinated across states, deployed nationwide, encouraged with federal tax policies, and accompanied by consumer education.