Modeling of Dynamics in Demand Response for Real-time Pricing

To avoid the excessive suppression of electricity demand caused by conservative planning of electricity price, real-time minute-to-minute control of the electricity price, which is called real-time pricing, is required. However, the electricity demand response has the dynamics on a timescale shorter than an hour, which can cause catastrophic incidents if the real-time pricing is done without ample consideration, and the model for such dynamics is demanded. For this background, a new dynamic model for the electricity demand response is proposed in this paper. Since the main source of the price elasticity utilized in real-time pricing is considered to be the temperature setting of HVAC equipment, an experiment with an air conditioner is performed to get a quick sketch of the dynamics. Then, from the experimental results and knowledge from existing literatures, a kind of dynamic linear model with Markov-switching is introduced and shown to be a good model for the electricity demand response on a timescale shorter than an hour.