Developing a Two-Level Framework for Residential Energy Management

Residential energy management (REM) program is a demand response (DR) tool that automatically manages energy consumption of controllable household appliances to improve the energy consumption profile of a house according to electricity price. REM intends not only to improve technical aspects of distribution systems but also motivate customers for active participation in DR programs. In this regard, this paper proposes a two-level REM framework. In the first level, each customer runs an optimization problem to minimize his payment cost and sends the desired operation scheduling of appliances and the payment cost to the system operator. In the second level, a multiobjective (MO) optimization framework is designed to improve technical characteristics of the distribution system such as total load demand deviation, given the least desired payment cost of each customer. The objective functions of this MO optimization structure are to minimize deviation of distribution system load and to minimize costs of modifying the desired scheduling of customers. The proposed algorithm is mathematically modeled and applied to the IEEE 34-node test feeder to prove its advantages for customers and system operators in comparison with the available REM strategies.