Demand Response (DR) programs serve to reduce the consumption of electricity at times when the supply is scarce and expensive. The utility informs the aggregator of an anticipated DR event. The aggregator calls on a subset of its pool of recruited agents to reduce their electricity use. Agents are paid for reducing their energy consumption from contractually established baselines. Baselines are counter-factual consumption estimates of the energy an agent would have consumed if they were not participating in the DR program. Baselines are used to determine payments to agents. This creates an incentive for agents to inflate their baselines. We propose a novel self-reported baseline mechanism (SRBM) where each agent reports its baseline and marginal utility. These reports are strategic and need not be truthful. Based on the reported information, the aggregator selects or calls on agents to meet the load reduction target. Called agents are paid for observed reductions from their self- reported baselines. Agents who are not called face penalties for consumption shortfalls below their baselines. The mechanism is specified by the probability with which agents are called, reward prices for called agents, and penalty prices for agents who are not called. Under SRBM, we show that truthful reporting of baseline consumption and marginal utility is a dominant strategy. Thus, SRBM eliminates the incentive for agents to inflate baselines. SRBM is assured to meet the load reduction target. SRBM is also nearly efficient since it selects agents with the smallest marginal utilities, and each called agent contributes maximally to the load reduction target. Finally, we show that SRBM is almost optimal in the metric of average cost of DR provision faced by the aggregator.
In competitive electricity market systems such as Texas, Load Serving Entities (LSEs) purchase energy in a wholesale market and then sell it in a retail market. In wholesale market, LSEs see dynamic real-time prices, whereas in retail market, LSEs typically provide flat rate contracts to end-consumers. An intuitive idea to induce savings for LSEs is to shift loads from high-price hours to low-price hours of the wholesale market by incentive-based demand response. We design and implement such a system, called EnergyCoupon, to provide coupon incentives to users and collect their responses. We run the experiment over household participants through the summer of 2016. The experimental results suggest behavioral changes in energy consumption can be achieved, which could be beneficial to both end users and LSEs. This paper presents the system set up, key algorithms, as well as experimental results analysis. Demand response on the residential market is becoming a solution to adapt customer consumption to the offer available and therefore lower the electricity peak prices. Tariff incentives and direct load control of residential air-conditioners and electric heaters are flexible solutions to reduce the peak demand. To include residential demand response resources in planning operators, quantifying the demand reduction is becoming a major issue for all electrical stakeholders. Current methods are based on day or weather matching, regressions and control group approaches. In general, methods using available data from a control group give more accurate results. With the introduction of smart meters, the electric utilities generate a large amount of quality data, available almost in real time. In this paper, we suggest using these available residential load curves to select a control group based on individual load curves. One of the advantages of our method is that the selected control group could adapt at anytime to the number of individuals belonging to the demand reduction program, as this number evolves with customers entering and leaving the program. Constrained regression methods and an algorithm are developed and evaluated on real data, providing a reliable solution for an operational use. Controlling electric loads to deliver power system services presents a number of interesting challenges. For example, changes in electricity consumption of Commercial and Industrial (CI however, a number of facilities exhibit real DR parameter variability. In some cases, the aggregate population of C&I facilities exhibits real DR parameter variability, resulting in implications for the system operator with respect to both resource planning and system stability. Demand response aims at utilizing flexible loads to operate power systems in an economically efficient way. A fundamental question in demand response is how to conduct a baseline estimation to deal with increasing uncertainties in power systems. Unfortunately, traditional baseline estimation lacks the ability to characterize uncertainties due to their deterministic modeling. This deficiency often results in erroneous system operations and miscalculated payments that discourage participating customers. In this paper, we propose a Gaussian process-based approach to mitigate the problem. It features the ability to use all historical data as a prior knowledge, and adjust the estimation according to similar daily patterns in the past. To characterize the uncertainties, this method provides a probabilistic estimate that can be used to not only increase estimation confidence for system operators but also to fairer treatment to customers. Finally, simulation results from Pacific Gas and Electric Company data show that this new method can produce a highly accurate estimate, which dramatically reduces the uncertainties inherent in the distribution power grid. Such a work opens the door for power system operation based on probabilistic estimate.