A multistage coupon incentive-based demand response in energy market

Abstract

Demand Response (DR) has the ability to use generating assets more efficiently. Because of the increased power consumption, it has become necessary for the power system networks either to upgrade the already existing power system or to inculcate some schemes to minimize the load. To address this issue incentive-based demand response proved to be an effective tool to change the pattern of consumption. This work proposes a novel three-tiered hierarchical CIB-DRP operated on a modified PJM 5-Bus system, where ISO’s economic dispatch computes the localized marginal pricing, LSE issues coupons and consumers provide the demand reduction. Two wind generators are incorporated to the test system and its effect on the system is analyzed. The optimization problems are modelled using PSO and LP in MATLAB. The results demonstrated that the proposed CIB-DRP reduces the peak demand, flattens the load curve, and increases the power factor.

Keywords

• Demand response
• Load serving entity
• Expected net revenue
• Independent service provider
• Localized marginal pricing
• Demand reduction