Abstract: Demand response can not only be used as a power supply resource to generate negative electricity price when high electricity price or power grid reliability is threatened, but also can be used to solve the problem of transmission expansion planning. Basically, demand response resources (DRRs) can alleviate the capacity demand of load area, so as to alleviate the input transmission demand. This paper introduces PJM capacity market, comprehensive capacity market and demand response model in detail, and makes case analysis. Through the market mechanism of demand response (DR) in the United States, aiming at the difficulties encountered in the process of participating in the electricity market, and considering the development status of the demand response mechanism in China, this paper puts forward some suggestions on the establishment of DR market mechanism in China. Through the appropriate market mechanism, DR can participate in the operation of the power market, improve the efficiency of energy utilization, improve the balance between supply and demand and the efficiency of resource allocation. Through the appropriate market mechanism, participate in the operation of the power market, improve energy efficiency, improve the balance between supply and demand regulation and resource allocation efficiency.