Customer behavior based demand response model

An important benefit of demand response (DR) is avoided need to build power plants to serve heightened demand that occurs in just a few hours per year. There are two basic categories of DR options: price-based and incentive-based DR programs. In this paper, both categories of DR measures are modeled based on the demand-price elasticity concept. It has been shown that customers´ reaction against implementing price-based or incentive-based DR programs are not similar, so that incentive-based programs have key impact on customer habit formation in response to DR programs. An improved DR model is developed which considers the customer´s behavior. The proposed model extinguishes between customers´ behavior with respect to electricity price change and his/her behavior against variation of incentive. The performance of the model has been justified by implementation on the IEEE reliability test system.