Stochastic demand charge management for commercial and industrial buildings

In this paper, we propose a strategy for battery operation to manage monthly peak electricity demand of commercial & industrial buildings and reduce the associated Demand Charges (DC) in their utility bills. In specific, we present a stochastic optimization model that calculates the monthly Demand Charge Thresholds (DCT) at month-ahead. During the month, the battery charges and discharges according to DCT and measured demand at each time step. We apply techniques that convert the rule-based control algorithm into linear constraints and incorporate them in the model. Case studies suggest that, compared with other methods, the stochastic method generates DCTs closer to their expected value and achieves higher Demand Charge (DC) savings.