The study on impacts of the demand response participation of the electricity customers in electric distribution system operation

Before the introduction of liberalization and regulatory reforms, electric power industries were vertically integrated which a company controls generating, transmission, distribution and consumer services. In these situations, integrated utilities had cross subsidies of their unregulated activities, inadequacy of infrastructural investments, ineffective coordination between firms, collective dominance and the constitution of concerted practice by direct or indirect contact between firms were likely to affect negatively on competition of markets. Moreover, firms decreased consFumer service quality caused by operational inefficiencies. In the late 90s, in many countries liberalization processes began with unbundling of vertically integrated structures. Thus, cross subsidies are eliminated. Liberalisation of electricity industry delivered some efficient operations like deferral of infrastructure investments, decreased capacity constraints and elastic demand between consumers via new wholesale and retail competitive market programs that created for demand response participating. Grid storage systems and demand response offer a solution to market price volatilities due to production uncertainness of wind and solar systems. This study aims to contribute to this growing area of grid flexibility using demand response forms including supplier changing, product offerings, demand time-shifting or reducing demand by direct or indirect ways of demand side operators. In this thesis, firstly this questionnaire investigated how much competition exists in electricity retail and wholesale markets. Investigations are showed that in European countries, the market concentrations, the Herfindahl-Hirschman indexes are quite high and as well as more than half of them have a dominant power plant whose market share is more than fifty percent. For the purpose of assessing the retail market functioning and competition, NordREG has developed a set of indicators. These are number of suppliers, switching rates, price spreads, concentration indexes. With these indicators NordREG monitors the markets and identify the stronger and weaker positions of countries and the enhancement requirements of each market. In Europe, the switching rates are less than %14. Because of the some barriers to supplier switching the rates are quite low. Firstly, it is obvious that the monetary gain of switching should be higher than transactions costs. Second, Consumers tend to be willing to switch suppliers more if the switching process is easy. Also, lack of trust to contract terms and policies inhibits long-term contracts. Last, customers behave irrationally when over satisfied with local suppliers. Hence, it is presumable that for a while the competition in retail markets remains locally small. U.S. Federal Energy Regulatory Commission (FERC) published National Assessment of Demand Response Potential Assessment in order to estimate a nationwide demand response potential in 5 or 10 years horizons. The Assessment develops four scenarios: Business-as-Usual, Expanded Business-as-Usual, Achievable Participation and Full Participation. In 2019, the report foresees that with the Full Participation scenario which of 100 percent of demand response participators have all incentive and price enabling technologies, especially HVAC systems, twenty percent reduction is possible in the peak demand. In this research, primarily HVAC systems investigated for price-based demand response programs. Thermostatically Controlled Loads that respond to real time price is proposed and Time-of-Use daily utility rate plans are designed. For this purpose, an electric low voltage distribution feeder with three hundred twenty home simulated in GridLAB-D software. It is obvious that the energy consumption of home appliances and HVAC systems depend on terminal voltage, number of users and comfort level of them, briefly the social and economic factors. Home appliances are composed of clotheswasher, dishwasher, dryer, waterheater, range, lights, refrigerator, plugload and occupants with detailed loadshape models. In this work, only the HVAC and waterheater are modeled to have an ability as price incentive demand responses and other appliances are in passive mode. In the next section, the heat balance of home analyzed due to bases of temperature control of HVAC systems in demand response programs. Initially, the equivalent thermal parameter model (ETP) is analyzed heat gains and losses and the effects of thermal mass, as a function of solar radiation, thermostat temperature settings and heat gains by occupants and appliances. The most comprehensive thermal integrity model of house with the insulations configured in GridLAB-D. Each house modeled in GridLAB-D has two primary sources of internally generated heat. First, is the waste heat given off by other devices in the house. Second, there are devices in the home that are not explicitly modeled but that have sufficient aggregate impact that their heat contribution to the house and their aggregate impact on the home's electricity must be accounted for. The auction based market implements by submitting seller and bidder bids of price for a set of quantity simultaneously. The market clears by intersection point of the supply and demand curves. Double auction market simulates a merit order as buyers are sorted from highest price to lowest price and sellers are sorted from lowest price to highest price. But, in this work we used only pre-prepared Time-of-Use tariff prices with the buyers/bidders in the day-ahead market. We only deal with consumers and generators are out of scope of this thesis. Anyway, it is observed that the limited power quantity behaved like buyers in the capacity constrained market scenario. In addition, observations showed that the HVAC systems do not have any demand response with flat price rates. On the other hand, hourly price and three TOU price tariffs result more demand response participations. Transactive controllers are used to modify cooling setpoints of HVAC's in a range based on difference between market clearing and average prices. Price responsive controllers are the key components of price-based demand response programs. These controllers changes the loading profiles of appliances according to market prices. Thus, consumers avoid energy consuming during peak demand times. So the lower electricity bills are paid without reducing energy consumption. But if the TOU price volatility is high and sudden, e.g. very low prices following very high prices in peak hours, then suddenly the load diversity corrupts and peak demand overshoots which known as rebound effect. So that, the principal reasons for demand response participation disappear. In the literature, there are many advices about solving the rebound effect. One of them is supply capacity constraint solution in market auction mechanism that we analyzed within the scope of this thesis. However, even if the results verify the solution, another very high market clearing price (price cap) problem arose. The supply capacity limitation also causes the disruption of supply and demand equilibrium. The market clears when just reached to limited power of aggregated bids but still have buyers who must consume energy at whatever the prices are. So unhealthy price formation occurs and clearing prices goes through the highest point. At the end of work different factors to influencing the demand response participation and different participation ratios to influencing the grid scenario results are discussed.