A Market-Based Model for ISO-Sponsored Demand Response Programs A White Paper Prepared for the Multi-Client Study: A Critical Examination of Demand Response Programs at the ISO Level: End Goals, Implementation and Equity Organized by the Center for the Advancement of Energy Markets (CAEM) and Distributed Energy Financial Group, LLC (DEFG) August 2005 Prepared by Vernon Smith Professor of Law and Economics Interdisciplinary Center for Economic Science George Mason University Rasmuson Chair University of Alaska, Anchorage 2002 winner of the Bank of Sweden Prize in Memory of Alfred Nobel Lynne Kiesling Director, Center for Applied Energy Research International Foundation for Research in Experimental Economics (IFREE) Senior Lecturer of Economics Northwestern University Research Scholar, Interdisciplinary Center for Economic Science, George Mason University