Simulation of Market Mechanism in Promoting Demand Side Management by Open-agents Model

Demand side management (DSM) plays an important role in energy efficiency. How to simulate DSM with market mechanism is important for policy maker and is also a complex issue. The paper studies the impacts of establishing DSM market mechanism with DSM charge in China by an open-agents model. It consists of a government agent, 15 sectoral agents and human experts, open to human experts. The government agent sets forth the strategy for raising electric power price within the scope prescribed by Consumer Price Index (CPI). The industrial sector agent sets forth strategy for maintaining profits after the rise in its costs. The human experts will intervene in all the agents when necessary. The analysis results show that DSM charge by 1% in electricity tariff bill in 2002 would make CPI rise by 0.069, save energy 72.2TWh, save coal used in thermal power plants around 27.65Mtce. The energy intensity would be fallen by 1.67%, and around 70Mt CO2 and other pollutant emissions would be avoided.