DYNAMIC PRICING DESIGN FOR DEMAND RESPONSE INTEGRATION IN POWER DISTRIBUTION NETWORKS

Author’s Name :  D Sabapathi | P Venkatachalam

Volume 02 Issue 03  Year 2015  ISSN No:  2349-2503  Page no: 11-16

Abstract:

This paper presents optimal pricing design for demand response (DR) integration in the distribution    network. In particular,  we  study the energy  scheduling  problem  for  a load serving entity (LSE) that serves two types of loads, namely in- exible and exible loads. Inexible loads are charged under a regular pricing tariff while exible loads enjoy a dynamic pricing tariff that ensures cost saving for them. Moreover, exible load are assumed to be aggregated by several  DR   aggregators. The nteraction between the LSE and its customers is formulated as a bi level optimization problem where the LSE is the leader and DR aggregators are the followers. The optimal solution of this problem corresponds to the optimal pricing tariff for exible loads. The key advantage of the proposed model is that it can be readily implemented thanks  to  its  compatibility  with  existing  pricing structures in the retail market. Extensive numerical results show that the proposed approach provides a win-win solute the LSE and its customers.

Key Words:

Bilevel programming, complementarity modeling, demand response, dynamic pricing, load serving entity

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