Abstract
ABSTRACT The balancing approach of electricity generation and consumption is an essential part of a reliable power system. The mismatch between supply and demand may also cause fluctuation in the power system. This study proposes an incentive and penalty-based demand response (I&P-DR) program for improving the profitability of both LSE and customers. First, we use a parameter that weighs the financial benefits of LSE and customers and provides considerable economic benefits to both sides. Second, an incentive and penalty (I&P) price scheme have been employed to recompense and penalize customers and reduce the electricity demand at peak hours. Finally, the study analyzes the importance of (I&P-DR) and its impact on customers’ sensitivity during peak intervals. Simulation results showed that the flexibility to consumption can be brought through the application of the proposed (I&P-DR) program and also provide the financial benefits to both, customers and LSEs.
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