Enabling demand response potentials for resilient microgrid design

The future microgrids (MGs) hosting a great deal of uncertain and intermittent local renewable generations are envisioned to need for fast and flexible units in the generation side. Demand response, however, as a load shaping tool can alleviate the needs. This paper proposes a model to consider demand response potentials activated by time-varying prices in MG design studies. The model aims at maximizing MG owner’s profit while technical limits and constraints are adhered. The model also ensures that the designed MG is resilient against islanding events. To handle complexity of the model, Benders decomposition is used to decompose the model into a master problem and two types of sub-problems. The master problem optimizes binary variables indicating installing status of generating units and batteries. The first type of sub-problems optimizes continuous variables, and the second ensures the resilient operation of the MG against islanding events. In the model, the uncertainties associated with load and intermittent generation resources are captured via a scenario-based stochastic approach. The demand behavior in response to time-varying prices is modeled via price elasticity coefficients. The effectiveness of the proposed model is demonstrated through extensive numerical studies and sensitivity analyses.