Optimal Design of a Score-based Incentive Mechanism for Promoting Demand Response Participations of Residential Users

Demand response (DR) can effectively promote the users to adjust their power demands independently, so as to optimize the overall load curve, relieve the pressure of peak load growth, and ensure the reliable operation of the power system concerned. Aiming at the fact that residential users do not have the access to the market quotation and the non-real-time dynamic variability of electricity price under the current electricity market mechanism in China, a new strategy to promote active participations of users in demand-side response, i.e., a score-based incentive mechanism for attaining demand response (SIDR) from residential users, is proposed. First, the load models of electrical appliances in residential users are established, with the comfort degrees of the users taken into account. Then, the cost-benefit analysis is carried out from two market entities: the power grid company and the residential users. On this basis, a bi-level optimization model of score-based incentive mechanism for promoting demand response participations of residential users is established. It is shown by case studies that the proposed SIDR can effectively encourage the residential users to participate in DR and hence enhance the economics of power system operation.