Simulation of DSM resources as generating units in probabilistic production costing framework

To study the economics of DSM resources the avoided cost method is used which requires two production cost simulation runs; one with a base case set of loads and another with the load shape changed by the expected impact of DSM. This paper presents an efficient technique which allows a single simulation to study probabilistically the impact of DSM on loss-of-load probability, energy not served and energy consumption in a probabilistic production costing methodology. It also provides an analytical method to study the impact of DSM on capacity requirements. Another advantage of this technique is that the DSM administrative costs can directly be incorporated while simulating the DSM resources. The proposed technique does not alter the original load shape but basically models DSM resources as generating units in the system. The technique is applied to IEEE RTS data to compare the results with the avoided cost method.