Optimization of grid-connected MicroGrid demand considering demand response

Electricity grid is a product of urbanization expansion and rapid development of various infrastructures worldwide and over the past centuries. Although power companies are located in diverse regions, they typically use the same technologies to generate and distribute electricity. Proper implementation of the demand response (DR) program should be provided with some equipment to make subscribers aware of electricity price at any time and accordingly provide a proper response to the grid to reduce costs. This, in turn, reduces demand during peak hours. The intelligent grid, using the two-way communication network and the transmission of information to subscribers, and an advanced metering network provide a good structure for fully implementing DR programs. The present study applies a demand response economic model to implement DRs. The model uses price elasticity of demand, which provides subscribers a more precise consumption behavior regarding the factors influencing demand (e.g., electricity prices, bonuses, and fines). Applying the model to the microgrid, the operating cost significantly decreases in both operating modes.