Customer behavior based demand response model

An important benefit of demand response (DR) is avoided need to build power plants to serve heightened demand that occurs in just a few hours per year. There are two basic categories of DR options: price-based and incentive-based DR programs. In this paper, both categories of DR measures are modeled based on the demand-price elasticity concept. It has been shown that customers' reaction against implementing price-based or incentive-based DR programs are not similar, so that incentive-based programs have key impact on customer habit formation in response to DR programs. An improved DR model is developed which considers the customer's behavior. The proposed model extinguishes between customers' behavior with respect to electricity price change and his/her behavior against variation of incentive. The performance of the model has been justified by implementation on the IEEE reliability test system.