A New Residential Demand Response Management Method Based on a Social Welfare Optimization Framework
Published:
Problem setting: Each consumer is given a smart meter that monitors their electricity usage and at the same time informs the customers of the new prices (referred to as policy, designed by our proposed method) at the start of each hour.
The new price signal is comprised of time and usage dependent parameters. This new pricing method encourages users to reshape their usage algorithm towards a responsible model in which the load peak and electricity costs for the users are reduced.
Results: By implementing the proposed pricing method and optimizing power consumption, the load peak will reduce by 21% and the cost of users’ electricity bill will decrease by 16% and at the same time the total welfare level will remain nearly the same.
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