The impact of flexibility on demand-side management and the need for consumer-oriented demand response

Abstract

In the context of smart electricity grids, demand­side management is a set of measures

to motivate end consumers into adapting their energy demand to the available gen- eration resources. To achieve this goal, demand­side management solutions reward

flexible consumers through demand response programs. Recent trends point towards the development of home energy management systems to leverage the potential of

residential consumers to contribute to demand response efforts. However, current re- search is still ongoing and more studies are needed on how to design demand response

programs with home energy management systems that appeal to end consumers. This study addresses limitations of home energy management systems in the literature and proposes a consumer­centric demand­side management approach based on a bi­level optimization model. First, consumers solve a lower­level multi­objective load scheduling problem to optimize their individual savings and comfort. Then, demand aggregators solve an upper­level single­objective demand profile aggregation problem to optimize its peak­to­average ratio. Experiments investigate the impact of optimization methods, distributed energy resources, consumer preferences and behavioral patterns on the demand response program’s operation. Results indicate that while distributed energy resources contribute to reduce consumption costs and discomfort, they incur a negative

effect on the community demand’s peak­to­average ratio. In addition, consumer flexibil- ity, dynamic pricing, and active consumer participation in the demand reponse process

are key factors to the success of demand­side management solutions. Future work can improve in aspects such as modeling uncertainty, sustainability, and grid stability, as well as experimenting with real consumer communities.