An Investigation of the Accuracy of the Measurement of Load Reduction for Demand Response Programs offered to Residential Customers

Abstract: In this paper, the evaluation of load reduction through customer baseline load calculation is investigated. Moreover, the impact of accuracy of this calculation on the peak time rebate program offered to residential customers is investigated. In a hypothetical case, this program is offered to residential customers and its economic performance is evaluated with respect to the customer baseline load accuracy performance. For the purpose of this analysis, two popular methods of High5of10 (commonly known as NYISO method) and regression, and their adjusted forms are selected to compute the customer baseline load. Then, this calculation is utilized to examine the performance of a hypothetical case of peak time rebate program offered to 300 residential customers collected by the Irish Commission for Energy Regulation smart metering trial dataset. Based on the results of the case study, this hypothetical utility pays over 50 percent of its revenue as a rebate just because of the inaccuracy of the customer baseline load calculation methods. This loss would increase if the aforementioned methods get adjusted for the morning consumption. In the end, it is discussed that peak time rebate programs can cause an unfair redistribution of the utility’s revenue. Moreover, it is argued that such random distribution of rebates can cause a financial loss to the customers eventually.

Keywords: Demand Response (DR), Peak Time Rebate (PTR), Percent Accuracy Metrics, Percent Bias Metrics, Customer Baseline Load (CBL).