Two-Stage Residential Energy Management Considering Network Operational Constraints

This paper suggests a decentralized optimization of residential demand to minimize the cost to the utility company and customers while maintaining customer satisfaction. As an important feature, distribution system constraints such as equipment capacity, line flow limits, and phase balance constraints are taken into account. Due to the large amount of uncertainty in the residential demand, a two-stage pricing is considered. In the first stage, day-ahead prices as well as residential appliance scheduling are determined through interaction of the utility company and residential customers. Uncertainty of the customer demand is also considered in the day-ahead pricing. In the second stage, on the other hand, prices will be updated based on the actual residential loads. Similar to locational marginal price (LMP) in transmission system, customers on different nodes are charged with different prices. Performance of the approach is shown on a sample distribution system.