Spinning reserve (SR) is a generation ability available to the operator within short time to meet a demand in an unexpected disruption to the supply. In a power system, establishing a SR at a high level is a simple attractive way to limits the risk of an interruption of supply or even a blackout. However, keeping SR high is also costly cause it needs additional generators for securing the SR. Given this trade-off, this paper is to propose a optimization model, by which a total cost of generation and setting the SR requirements can be evaluated and hence optimized. In addition, the model considers demand response (DR), which changes the amount and pattern of electricity demand in response to various compensations. The model is used to plan SR and DR requirements from a utility or planner, who wants to minimize social costs. Numerical studies using IEEE-RTS data shed light on a generation schedule among methods of SR scheduling, expense of supply interruption, and DR consideration