The research on DSM cost-benefit analysis and cost recovery mechanism to electricity companies based on transmission and distribution price

Demand Side Management (DSM) is one of the most important measures to improve electricity efficiency. It is beneficial to guarantee the balance of power supply and demand as well as to establish a stable, clean and economic energy supply system. The new power system reform in China emphasizes the subject position of power grid enterprises in DSM and it is an opportunity to promote the development of DSM. Researched is conducted on how to analyze the cost and benefit of DSM to electricity companies in order to recover investment and encourage the practice of DSM. Firstly, the cost and benefit to electricity companies when implementing DSM projects are analyzed according to the instruction of the new power system reform. Then the cost-benefit model is established in which the transmission and distribution price reform is considered. Finally, the DSM cost recovery mechanism is put forward and case simulation under the practical background in Shenzhen is carried out to validate the role played by the mechanism in bringing economic and social benefits.