Modeling of Consumer Responses to Dynamic Pricing in a Smart Grid
Khan, Md Mahbubur Rahman
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This paper models the responses of three different types of consumers based on their sensitivity to dynamic price. Simulated household demand data is used to model the dynamic price of electricity. These prices are then used to experiment responses of consumers in a centralized dynamically priced power market. It is taken into consideration that some consumers will only have access to imperfect information but they can still alter their usage and benefit from the associated cost savings. Analysis based on a developed software system found that sensitive consumers, given full information and control with tools such as a Home Area Network and an Advanced Metering Infrastructure, could gain significant cost savings. Due to the reduction of the overall peak load caused by the shift in consumer demand, the electricity generation and distribution infrastructure could see significant savings as well.