Power system demand variation is a challenging job that needs to be done by power system operators. There have been many studies and research to reduce the peak hour load reduction and reduce the load demand. Most of the work is proposing to move the loads and different hour, and it will create another peak hour. After conducting various studies and research to overcome the problems of demand response, this thesis proposes a demand response (DR) algorithm to decrease the hourly peak load demand. The proposed method is using a voluntary based load scheduling for residential level consumers. The primary purpose of this work is to find hours with minimal consumers attempting to use electricity and shift the loads from high consumption hours. Through the proposed method, low demand hours can find by calculating the number of consumers and the load sum limit in each hour. The application was tested using ten residential loads. According to the results, the load demand variation can be reduced and try to keep the load consumption closer to an hourly limit amount. According to the proposed algorithm, residential load demand curves will allow the utility companies to buy electricity from less expensive sources. While considering hourly load demands, this thesis provides information of a supportive method to control the indoor thermal condition with the response to hourly electricity price.