A negawatt market is a proposed idea of implementation of the demand response (balancing the electrical grid through the changes in consumption) that uses an energy market where the commodity traded is a negawatt-hour, a unit of energy saved as a direct result of energy conservation measures.

Negawatt power is investment to reduce electricity consumption rather than investing to increase supply capacity. In this way investing in negawatts can be considered as an alternative to a new power station and the costs and environmental concerns can be compared.

A negawatt-hour is a unit of energy saved as a direct result of energy conservation measures, such as reducing the use of heat or electricity. Lovins credited the term to a typo in a document by the Colorado Public Utilities Commission in which the word "megawatt" was misspelled.[3]

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