Evaluation methods for market models used in Smart Grids

This paper investigates how demand response pilot projects for the residential sector can be evaluated. A simplified framework for how demand response pilot projects carried out for the residential sector can be designed has been developed. A review of 135 international pilot projects has been made. Interesting findings were that bill savings is the most common reason for participating and that customers tend to respond to blocks of prices instead of sudden increases in a certain hour. Also, customers tend to reduce their use of electricity when peak to off-peak price ratio is above three. Another finding concerning evaluation methods for DR smart grid projects is that a control group should be used to ensure the validity of a pilot project. The control group should be monitored simultaneously as the treatment group. This can facilitate determination of the true cause and effect relationship between variables and indicators.