Demand response an effective solution for dynamic balancing of variable supply with variable demand: Evidence from Indian electricity system

Abstract

In recent years, electricity systems have been undergoing rapid renewable energy transitions. This has introduced myriad challenges, namely, matching variability in both supply and demand sides, low plant load factors, resource constraints, etc. Managing these challenges requires effective demand-side solutions. Therefore, demand response (DR) approaches become relevant and essential in better-performing supply- and demand-side planning and management. For this purpose, in this article, two scenarios representing different situations and needing different interventions are developed for future years to study the effectiveness of demand-side solutions in managing the adverse supply-side constraints through an optimization model. The two scenarios are (i) Demand Response in Constrained Electricity System and (ii) Demand Response in High Renewables Electricity System. The model results suggest that the optimization model is robust enough to achieve an optimal as well as desirable solutions for both scenarios and provide evidence for the effectiveness of DR in addressing such challenges. DR solutions, if implemented effectively, can alter and moderate load curves to achieve perfect balance with supply profiles that are affected by resource constraints or by high penetration of solar and wind energy resources.