Active Demand Response Using Shared Energy Storage for Household Energy Management

Abstract

In a deregulated market, wholesale energy costs and distribution investment costs contribute significantly to consumers' electricity bills. However, in a low carbon electrical power system, the two cost pressure points may not be synchronous in time and space with each other. This paper develops a novel methodology for home area energy management as a key vehicle for demand response, using electricity storage devices. The aim is to enable energy storage at consumer premises to not only take advantage of lower wholesale energy prices, but also to support low voltage (LV) distribution networks for reducing network investment. New operation strategies for domestic energy storage to facilitate demand response (DR) are developed in the paper. They have the capability to maximize the overall savings in energy costs and investment costs. In the proposed approach, the operation of home-area energy storage devices is jointly conducted by end customers and network operators. The purpose is to fight for an optimal balance between DRs to energy price and to network congestion, and thus to maximize benefits for both consumers and network operators. An intensive study is carried out to investigate the impacts of different dispatch strategies on wholesale energy costs and network investment costs. Benefit quantification methods are introduced as well to evaluate the total benefits in terms of savings in energy costs and investment costs that can be brought along by the proposed operation approach. The demonstration is carried out on two practical distribution networks with varying utilization levels for one typical calendar day and a whole year.