Optimal Energy Management of a Microgrid Incorporating a Novel Efficient Demand Response and Battery Storage System

Abstract

In this paper, optimal economic management of a grid-connected microgrid (MG) with distributed energy resource (DER) and its interaction with incentive-based demand response programs (DRPs) is studied. The use of DR makes energy management system (EMS) of the MG an efficient tool in balancing the demand and supply, and therefore ensuring the network reliability. In this work, the cost function of customers is developed in the incentive-based DRP with the aim of receiving a more realistic incentive and then it is combined with EMS. Accordingly, the consumers offer hourly power reduction bids based on which they are sorted and then incentive-based payment model is implemented. At times, due to full utilization of grid and MG resources, the supply–demand balance cannot be maintained by respecting the consumer offers. Specific energy policies and contracts are required in this case for mandatory power curtailment in exchange for higher incentive payments by MG operator (MGO). The objective function attempts to minimize operation costs of the MG units such as Diesel Generator fuels costs, cost of power exchange with the main grid, battery energy storage system (BESS) costs and in the mean time, maximize MGO DR benefit. On the other hand, simultaneous EMS and DR management leads to a complex non-linear problem, which can be solved using whale optimization algorithm (WOA) in MATLAB software. To assess the performance of the proposed new approach, a grid-connected MG with DERs and reducible power of consumers is studied within a 24-h time cycle. Also, to verify the scalability of the implemented system, an MG with aggregators and a large scale battery is considered. Simulation results show that incorporating a developed DR into EMS is an efficient way in optimal performance of both demand and supply sides in conjunction with the goals of economic operation of MGs.