Impact of demand response resources on unit commitment and dispatch in a day-ahead electricity market

Demand response (DR) has recently become an important resource in both system operation and market operation. The focus of this paper is to investigate and quantify the cost impact of various demand response modelings on unit commitment and dispatch in a day-ahead market regime. We have used mixed integer programming unit commitment model, in the market operation framework. Day-ahead market is modeled with a typical test system. Our research results show that DR can exert downward pressure on electricity prices, causing significant implications on social welfare. Results from this work will help policy makers, resource planners, and market designers to make more informed decisions with the goal of better accommodating more demand response resources in the future. (C) 2014 Elsevier Ltd. All rights reserved.