A demand response based solution for LMP management in power markets

In recent years, most of the countries around the world have gone through the power system restructuring process. Along with this restructuring in power market there are some issues like LMP problems that need to be solved base on demand response. In this article, demand-side management (DSM) programs have been effective to address LMPs in the market and system operators experience throughout their day-to-day activities. In particularly, these programs can help independent system operator (ISO) to reduce price volatility during peak demand hours. For achieving this purpose, a multi-objective optimal power flow is proposed to study the impact of a model for a demand response program on price spikes. Actually a new framework using demand response program was presented for price spikes reduction. As a case study for the formulation, the IEEE 9-bus, load curve of Mid-Atlantic region of the New York network is used to compare local prices in the system with and without emergency demand response program (EDRP). The study results demonstrate the effectiveness of these programs in an electricity market and showing them as appropriate tools in managing the LMPs of the power market more efficiently.

Research highlights
► DSM programs have been effective to address LMPs in the market and system operators experience.
► These programs can help ISO to reduce price volatility during peak demand hours.
► The effects of demand response program on LMP spikes and operation cost reduction are evaluated.