Price Based Indirect Control Scheme of Load Aggregator for Residential Demand Response

Abstract

The popularization of smart meters and smart appliances in households, as one of the achievements of smart grid development, provides a great opportunity for residential electricity consumer to participate in demand response (DR) programs. It is necessary to take full advantage of DR as a dispatchable resource for reducing the peak regulation pressure and the operation cost of the power system. Focused on price mechanism, this paper proposes an indirect control scheme of the load aggregator (LA) based on a two-layer model. The upper-layer is the optimization model of LA aiming to maximize the electricity sales profit from residential consumers (RCs) and the DR rewards from the independent system operator (ISO). The lower layer is the DR models of RCs. The LA realizes the indirect control over RCs by changing price signals under the constraint of not increasing the electricity cost of RCs who do not participant in DR. Each RC can independently respond to the price signals with the home energy management system (HEMS) to minimize the electricity consumption cost while ensuring the comfort by optimizing the electricity consumption behaviors. Simulation results show that the proposed indirect control scheme can obtain a mutually beneficial and win-win price signal, taking into account the interests of both the LA and RCs. This effective DR mechanism could realize friendly interaction between the ISO and RCs through the LA, which meets the requirements of system operation.