Optimal Strategies for Scheduling the Hourly Demand Response Considering Uncertainties of Renewable Energy in Day-ahead Market

Traditionally, the distribution system operator (DSO) is responsible for the reliable operation of power distribution systems. However, the advent of micro-grids in electric power distribution systems promotes a new role of DSO where it is responsible for aggregating the widely dispersed distributed energy resources (DERs), small thermal generation units, and flexible loads into the electricity markets. This paper presents an optimal demand response (DR) bidding framework for aggregators in the distribution network, that help integrate the uncertainty of the power output of the wind turbine. In the proposed framework, the load aggregators collect and submit DR offers to the DSO to make their contribution to the market operation. The load reduction offers include load curtailment, load shifting, and the generation from DERs. The DSO solves market clearing problem using the proposed DR model for the day-ahead market using a mixed-integer linear programming (MILP) model. The proposed approach for DR participation and market clearing is implemented using a 6-bus test system, and the merits of the proposed DR model are demonstrated using two cases for hourly unit commitment and ten scenarios for wind variability.