Optimal Planning and Operational Strategy of a Residential Microgrid With Demand Side Management

This paper proposes a joint optimization model of grid-tied residential microgrid (MG) planning and operation with the support of demand side management (DSM). In this model, the residential MG is included with various distributed energy resources, such as photovoltaic units, wind turbines, microturbines, diesel engine generators (DEs), and battery energy storage systems (BESSs). The proposed model is formulated as a bi-objective optimization problem in view of economic and environmental contemplation. Therefore, the minimization of MG total annual cost and total annual emission are considered as the primary objectives. This paper mainly analyzes the benefits of DSM assistance in the process of residential MG joint planning and operation optimization. The proposed bi-objective optimization problem is converted into a single-objective optimization problem and the single-objective problem is solved using a mixed integer linear programming method. To investigate the impacts of DSM on the MG planning and operation problem, the proposed model is applied to a residential MG consisting of 1000 smart homes with different DSM participation levels. The simulation results show that the proposed model is an efficient tool for residential MG planning and operation optimization from the perspective of economic and environmental considerations.