Electric utilities are forced to adopt load shedding during peak periods due to increase in demand by fast growing industries. Under peak period, the proposed Frequency Based Demand Management System, switch off all the low priority loads, while operating the deferrable loads based on environmental condition. The system also manages the operation of storage unit between Demand Management (DM) and Uninterruptible Power Supply (UPS) mode. The proposed Demand Management System (DMS) manages all the controllable loads and storage unit of the consumer based on system and environmental condition, thereby maintaining the system frequency. The system gives more convenience to the consumers and also relieves the utility from the bottleneck