Integrated planning framework for microgrid incorporating the flexibility provision capabilities of demand response programs

The penetration of renewable energy sources (RESs) in power systems has led to an increase in the system's flexibility needs. An integrated planning framework for long-term capacity sizing and short-term operation planning of an isolated microgrid (MG) using the flexibility capabilities provided by optimal demand response (DR) strategies is presented in different scenarios. DR programs incentive optimization is applied for omitting or reducing the mismatch between consumption and generation profiles to achieve economic investment and operation planning. The evaluated scenarios include the combination of photovoltaic (PV) system, wind system, battery, supercapacitor, and pumped heat energy storage (PHES). The objective function is to minimize the annual costs of MG design and operation. A new method is proposed for hourly pricing of DR programs based on the amount of charging and discharging of the energy storage system for isolated MGs. The combination of PV, wind, and PHES systems is found to be the most cost-effectiveness configuration for the MG. The proposed DR program reduces the total costs of MG by 15.89% and increases system flexibility.