What system would be used in a domestic dwelling in periods of peak demand?

No system, Peak demand as defined by the Utility Cos is usually 7am-2pm. During those times everyone is at work or school in larger buildings with larger systems creating this period of peak demand, essentially staying comfortable on someone elses dime, and the programmable thermostat in the home would be in energy setback or unoccuppied mode. Or in some areas the Utility Co does this for the Homeowner via their own Energy Setback Systems or rolling Brown Outs if that is the answer your Teacher is looking for.