Foresighted Demand Side Management

We consider a smart grid with an independent system operator (ISO), and distributed aggregators who have energy storage and purchase energy from the ISO to serve its customers. All the entities in the system are foresighted: each aggregator seeks to minimize its own long-term payments for energy purchase and operational costs of energy storage by deciding how much energy to buy from the ISO, and the ISO seeks to minimize the long-term total cost of the system (e.g. energy generation costs and the aggregators' costs) by dispatching the energy production among the generators. The decision making of the entities is complicated for two reasons. First, the information is decentralized: the ISO does not know the aggregators' states (i.e. their energy consumption requests from customers and the amount of energy in their storage), and each aggregator does not know the other aggregators' states or the ISO's state (i.e. the energy generation costs and the status of the transmission lines). Second, the coupling among the aggregators is unknown to them. Specifically, each aggregator's energy purchase affects the price, and hence the payments of the other aggregators. However, none of them knows how its decision influences the price because the price is determined by the ISO based on its state. We propose a design framework in which the ISO provides each aggregator with a conjectured future price, and each aggregator distributively minimizes its own long-term cost based on its conjectured price as well as its local information. The proposed framework can achieve the social optimum despite being decentralized and involving complex coupling among the various entities

Cooperatives for demand side management

We propose a new scheme for efficient demand side management for the Smart Grid. Specifically, we envisage and promote the formation of cooperatives of medium-large consumers and equip them (via our proposed mechanisms) with the capability of regularly participating in the existing electricity markets by providing electricity demand reduction services to the Grid. Based on mechanism design principles, we develop a model for such cooperatives by designing methods for estimating suitable reduction amounts, placing bids in the market and redistributing the obtained revenue amongst the member agents. Our mechanism is such that the member agents have no incentive to show artificial reductions with the aim of increasing their revenue

Demand-Side Management Programs Under Retail Electricity Competition

Demand-side management programs comprise subsidies from franchised electric utilities for the purchase of high-efficiency appliances, e.g., air conditioners. Competition in power generation threatens the viability of these programs. However, it should also reduce the warrant for them. Under regulation, the justification for such programs depends, somewhat paradoxically, on below marginal-cost pricing. Eliminating regulation should permit pricing flexibility to discourage excessive on-peak energy use. It should also eliminate the assurance of returns that may have encouraged overbuilding of generation capacity. Entrants and incumbent utilities should find it easier to offer "energy services," i.e., to bundle electricity with appliances, if consumers are too myopic to realize the benefits of increasing energy efficiency. Environmental degradation remains a problem, but competition can improve the performance of incentive-based regulations (e.g., permit trades), reducing the value of DSM as a supplemental, second-best alternative.

Demand side management in China

Demand side management has been one of the effective means of load shifting and peak-load shaving. In a system with distributed generations and distributed renewable energy sources, demand response can significantly improve the efficiency of electricity usage and energy saving. With the development of advance metering infrastructure, and information and communication technologies, demand side management will play an important role in smart grid. The power grid in China is highly interconnected by high voltage transmission links. The State Power Grid of China has made the strategy of developing smart grid. In this paper, we will introduce the situation of demand side management in China. ©2010 IEEE.published_or_final_versionThe IEEE Power and Energy Society (PES) General Meeting, Minneapolis, MN., 25-29 July 2010. In Proceedings of PES, 2010, p. 1-

A Packetized Direct Load Control Mechanism for Demand Side Management

Electricity peaks can be harmful to grid stability and result in additional generation costs to balance supply with demand. By developing a network of smart appliances together with a quasi-decentralized control protocol, direct load control (DLC) provides an opportunity to reduce peak consumption by directly controlling the on/off switch of the networked appliances. This paper proposes a packetized DLC (PDLC) solution that is illustrated by an application to air conditioning temperature control. Here the term packetized refers to a fixed time energy usage authorization. The consumers in each room choose their preferred set point, and then an operator of the local appliance pool will determine the comfort band around the set point. We use a thermal dynamic model to investigate the duty cycle of thermostatic appliances. Three theorems are proposed in this paper. The first two theorems evaluate the performance of the PDLC in both transient and steady state operation. The first theorem proves that the average room temperature would converge to the average room set point with fixed number of packets applied in each discrete interval. The second theorem proves that the PDLC solution guarantees to control the temperature of all the rooms within their individual comfort bands. The third theorem proposes an allocation method to link the results in theorem 1 and assumptions in theorem 2 such that the overall PDLC solution works. The direct result of the theorems is that we can reduce the consumption oscillation that occurs when no control is applied. Simulation is provided to verify theoretical results.Comment: the 51st IEEE Conference on Decision and Control,December 10-13, Maui, 201

A Distributed Demand-Side Management Framework for the Smart Grid

This paper proposes a fully distributed Demand-Side Management system for Smart Grid infrastructures, especially tailored to reduce the peak demand of residential users. In particular, we use a dynamic pricing strategy, where energy tariffs are function of the overall power demand of customers. We consider two practical cases: (1) a fully distributed approach, where each appliance decides autonomously its own scheduling, and (2) a hybrid approach, where each user must schedule all his appliances. We analyze numerically these two approaches, showing that they are characterized practically by the same performance level in all the considered grid scenarios. We model the proposed system using a non-cooperative game theoretical approach, and demonstrate that our game is a generalized ordinal potential one under general conditions. Furthermore, we propose a simple yet effective best response strategy that is proved to converge in a few steps to a pure Nash Equilibrium, thus demonstrating the robustness of the power scheduling plan obtained without any central coordination of the operator or the customers. Numerical results, obtained using real load profiles and appliance models, show that the system-wide peak absorption achieved in a completely distributed fashion can be reduced up to 55%, thus decreasing the capital expenditure (CAPEX) necessary to meet the growing energy demand