Demand Side Management in Smart Grids

This assignment involves analyzing the concept of demand side management (DSM) in smart grids, including its benefits, challenges, and applications. It requires a comprehensive review of existing research papers and studies on DSM in smart grids, covering topics such as load shifting, peak demand reduction, and energy efficiency. The assignment also explores the use of DSM in combined gas and electricity networks, as well as its impact on distribution system planning and reliability evaluation. By examining these aspects, students can gain a deeper understanding of the importance of DSM in smart grid systems and its potential to improve energy efficiency and reduce peak demand.

Running head: MANAGING ENERGY RESOURCES AND REGULATIONS
Managing Energy Resources and Regulations
Name of the Student
Name of the University
Authors Note
Course ID

1MANAGING ENERGY RESOURCES AND REGULATIONS
Table of Contents
Introduction:...............................................................................................................................2
Demand side responses:.............................................................................................................2
Barriers to demand side responses:............................................................................................3
Distribution generation:.............................................................................................................5
Environmental impact of Distributed Generation:.....................................................................6
Demand reduction:.....................................................................................................................7
Technological and Financial trends brought in by UK regulations:..........................................8
Conclusion:................................................................................................................................9
Reference List:.........................................................................................................................11

2MANAGING ENERGY RESOURCES AND REGULATIONS
Introduction:
The demand side responses are associated with the intellectual energy use. Through
the demand side responses big business, services and customers may turn up or turn down or
might shift in the actual time. The demand side response is viewed as the important tool that
helps in making sure that a secure, sustainable and affordable system of electricity is
developed. The demand side responses provide assistance in understanding that demand
peaks and fill in trough, especially on circumstances when the power is plentiful, reasonable
and clean.
For the corporate and the consumers, the demand side responses are viewed as the
smooth way of saving the total cost of energy and lowering the carbon footprint (Singh et al.
2017). By promoting increased participation in the problems of industry, may result in
customer opportunity. The present study will be critically analysing the strategies of demand
side management and would provide explanation of drivers and barriers in their application.
Considerations should be paid towards technological and financial trends introduced by UK
regulations.
Demand side responses:
Demand side responses is viewed as key measures of demand management which is
available to help create balance in network. The demand side addresses the corresponding
constraints by adjusting with the energy consumptions and mitigating the purpose of under
supply (Behrangrad 2015). By altering the demand profile and raising flexibility in demand
side responses, the DSR can help the electricity marketplace to adopt the obtainability of
supply and requirements of demand. The consumers inspired by demand side responses are
taking short term shift of demand. This implies that increase and decrease in consumption

3MANAGING ENERGY RESOURCES AND REGULATIONS
leads to rise in export and take up the excess amount of energy from the network of
electricity.
Alternative demand side management instruments consist of efficient energy and
distributed energy. The energy efficiency helps in lowering the demand on permanent basis
and consist of measures such as creating insulation, more effective solutions of lightning,
higher efficient boilers etc. distributed energy denotes to the generation of power on system
namely storage and separate unit distribution.
The respondents from the interview has defined numerous advantages of demand side
responses and have put forward their argument that demand side responses may produce
value for the GB system by implementing higher degree of efficiency relating to system
capacity. The application of greater efficiency would help in providing guarantee relating to
appropriate security supply at lower level costs than the thermal generation (Spence et al.
2015). Alternative benefit of demand side responses is that it has the ability of lowering the
emission of greenhouses gas by reducing the demand for higher emission peak plant to
establish a systematic balance. For UK, it is vital to move in the direction of low carbon
economy where a constraint in the system prevails by the intermittent generations. Efficient
use of plant helps in lowering the emission of greenhouse gas and consumption of resources.
Interviewees has forwarded their acknowledgement by outlining the definition of
DSR despite being difficult to quantify in the direction of specific papers for indicative
estimates (Li et al. 2017). In a statement published by Energy UK where civic data have
stated a 20% rise in demand of 12GW. The sustainability report has outlined that the
technological prospective of demand administration is capped during system peaks that
ranges amid 33% in winter and 29% in summer.

4MANAGING ENERGY RESOURCES AND REGULATIONS
Barriers to demand side responses:
Several respondents of the interview have expressed their concerns that inadequate
measures have been adopted in developing the market for Demand Side Responses and the
demand side management in Great Britain (Gelazanskas and Gamage 2014). The respondents
have also mentioned certain obstacles relating to the roll out of several DSR products and
technology. The respondents of interview have flagged number of barriers in the placement
of DSR. The important regions stated comprised of concerned in the areas of market
structures, DSR perceptions, economics and market related regulatory arrangements.
Market Structures: Up to now the supply market was considered stable relatively with the
prevalence of foreseeable and controllable levels of generation such as expectable functions
in demand by making investment in flexible generation of thermal. The distribution network
is presently created with adequate network ability to meet the peak flows (Wu, Tazvinga and
Xia 2015). With increase in the renewables distribution networks and constant fall in industry
and large scale demand the system needs enhanced investment in flexibility that DSR can
offer. DSR could turn out to be one possible solution but requires development of flexibility
in marketplace and marketable arrangement to promote appointment of suppliers, aggregators
and customers.
Economic barriers: Customers need a monetary inducement to modify their arrangements of
electric consumption. This demands venture both in the money and exertion by customers
(Finn and Fitzpatrick 2014). Additionally, it is exposes the consumers to the risk, on failing to
distribute the services for which they are provided contract as they would be held liable for
penalties.
The UK regulatory requirement states that policy of energy has immensely placed
their emphasis on enduring reduction of demand through policies such as Green Deal and

5MANAGING ENERGY RESOURCES AND REGULATIONS
Energy Saving Opportunities Scheme (Yi et al. 2017). A large number of demand side
responses have the access to the wholesale and create a balance in market. Therefore, the
incapability of the demand side participants to access the balancing market and wholesale
market might create an impact on the efficient market capacity.
Distribution generation:
Distribution generation refers to the embedded generation. Distributed generation is
referred as the electricity producing plant which is linked with the distribution network rather
than transmission network (Djapic, Tindemans and Strbac 2015.). There are number of
distribution generation types which combines of heat and power plants and hydroelectric
power generators.
During the last few years’ significant amount of growth is noticed in distribution
generators which looks to connect with the distribution network. Moving with the increased
growth in the volume of connections there is an increased concern where customers have
experienced certain problems in circumnavigating their way through the construction process
(Qadrdan et al. 2017). The distribution network is regarded as the variety of technology that
facilitate the supply of power at or close to the solar panel, batteries and heat pumps. The
small scale asset is designated in the distribution of resources and energy with increase in
cost effectiveness and demand.
Distributed Generated resources creates highly sustainable and cost effective mixture
to consumers. The major driver of the growth is the increased competitiveness of the solar,
wind and technology in battery (Teng et al. 2015). Similar to industrial activities the
development in the distributed generation has given rise to exponential learning curve. The
reason for this is that with the rise in capacity and building of knowledge there is a fall in
price. however, the prices have been yet to fall to the level of wholesale electricity price.

6MANAGING ENERGY RESOURCES AND REGULATIONS
Responses obtained from the distributed energy have certain added advantages. This
includes lower the requirement of expensive peaker plants, lessening outlay on the new
transmission and distribution lines which increases the reliability of energy network
(Schachter et al. 2016). With more prevalent distribution energy responses, it provides the
opportunity of displacing the traditional generation of baseloads by creating disruption in the
structure of energy industry value chain. The opportunity of gaining revenue is by installing
the distributed resources of energy in the households. Customers at the residential level
would be able to generate and store energy that would additionally reduce the reliance on
variability of grid price enabling them to sell energy locally during selected times.
Community that are connected at residential level would assist in establishing energy
collaboration by communicating with each other to identify the correct time of buying or
selling energy.
Environmental impact of Distributed Generation:
The distribution generation can help in gaining benefit if the environment gains
benefit from its use and lowers the amount of electricity that must be derived at centralized
power point. This may lower down the impact on the environment from the centralized
generation. The technology of cost effective distribution generation is considered helpful in
generating electricity at homes and business that are making use of the renewable source of
energy namely the solar and the wind energy (Sweetnam et al. 2018). Furthermore, the
distribution generation provides assistance in harnessing the energy that might otherwise get
wasted through combined heat and power system. By using the local energy resources, the
distribution generation assist in lowering or cutting down the wasted energy that takes place
at the time of transmission and distribution of electricity delivery system. In spite of the
benefits of distribution generation there are certain amount of negative environmental
impacts.

7MANAGING ENERGY RESOURCES AND REGULATIONS
The system of distributed generation requires footprint and they are located close to
the end users. There is numerous system of distributed generation that may not be attractive
to eye and might lead to land usage concern (Hattam et al. 2017). The technologies of
distribution generation consist of combustion particularly burning of fossil fuels that results
in air pollution. The effects created by bigger fossil fuel may be smaller in measure but may
be located closely in the immensely populated areas. There are some technologies of
distributed generation particularly the burning of waste, burning of biomass with combined
heat and power may require water for generation of steam and cooling. The distributed
generation system that uses the burning of energy may be less significant than the centralized
power plants due to the inefficiencies in scale. The technology of distributed generation may
lead to negative environmental issues upon the conclusion of useful life when it is replaced or
removed.
Demand reduction:
A commitment has been made by UK of lowering the emission of greenhouses by
34% by the end of the year 2020. This is viewed as the giant step forward towards reduction
in demand but in actual situation it is not likely to be regarded as the giant step of bring to an
end to the increasing levels of extreme weather happenings such as drought (Sheng et al.
2016). Therefore, a developed country such as UK needs to go further. This does not imply
that drop in the standard would act as the tool of reducing the emission. Wastefulness is
correctly created in the system which the individual uses. A large number of power plants
releases approximately two third of the waste that ultimate contributes in the environment
with domestic house and office are improperly insulated. According to the government
research it is estimated that some of the people in UK can cut down the energy use by around
30% across the board and save close to £12 billion every year to reduce the bills and enhance
the energy efficiency.

8MANAGING ENERGY RESOURCES AND REGULATIONS
The research council of UK has stated guidelines for local population and other
people relating to the lower release of carbon. Further guidelines have been provided
regarding greenhouse gas emission and procedure involved in educating the public authorities
(Adefarati and Bansal 2016). The purpose of this guidelines is to encourage the local
authorities in reporting regarding the emission and provide assistance in the submitting and
interpreting the data. The guidelines relating to the financing of energy efficiency is issued in
the public to offer description relating to the availability of the options that are accessible to
the public sector companies in measuring the efficiency of fund.
In addition to this, model energy performance contracts are also issued in the form of
approach to assist the public sector organization to retrofit the homes and office insulation by
implementing the measures of energy conservation. They act as the medium of cutting the
carbon emission and achieving substantial amount of annual cost savings.
The government of UK has launched a program of street lightning toolkit during the
month of February in 2015 that is considered as the medium of helping the local authorities in
implementing the projects of exterior lightning (Capitanescu et al. 2015). Such measures
would help in improving the energy efficiency with lower usage of carbon with improved
financial savings. The toolkit is created to aid financial objectives of assisting the local
authorities to compute the potential cost of savings with a separate guidance of the
introducing documentation on the business development. The energy efficiency strategy
would help in increasing the present policy of energy efficiency and realise the UK wind
energy efficiency policy over the forthcoming years.
Technological and Financial trends brought in by UK regulations:
The demand side management act as the tool of lower the burden on electricity from
the customer’s end by applying the measures of efficient load shipping measures (Alwash,

9MANAGING ENERGY RESOURCES AND REGULATIONS
Ramachandaramurthy and Mithulananthan 2015). The fruitful demand side management
programs are promoted by government with state initiative and monetary constructions in line
to decrease the use of electricity by lowering the requirement of new generation sources.
The welfares of the energy efficient technologies are designed by associating the
avoided generation expenses and by avoiding the supports in electricity with loss in proceeds
from the reduced sale of electricity (Elmitwally et al. 2015). The demand side management
programmes is applied to reduce the additional peak or the capacity of load generation
together with the distribution facilities. The actual benefit for the highly developed economy
is that new equipment of reducing emission is far more less costly then enhancing the present
equipment. According to the report of world bank losing out on such opportunity instead of
creating new economies would lead to serious financial, environmental and social
consequences.
The strategies of utility demand side management are viewed as the measure of
resource acquisition. In other words, it aims to create balance among the options of supply
side and measures of the demand side options at the macroeconomic level until the marginal
costs and the substitute energy supply side options is equivalent to the marginal cost of the
demand side.
As stated by Mahmoud, Yorino and Ahmed (2016) the improvement in the end use
energy provides numerous advantage. The advantages comprise of the higher amount of
efficiency with direct and indirect monetary welfares to the customers and the general public
but reducing the needs of extra supply, and mitigating the risk from the future fluctuation in
price. Hence, an assertion can be bough forward by stating that efficient investment helps in
stimulating the economic growth with improved amount of energy security in UK.

10MANAGING ENERGY RESOURCES AND REGULATIONS
The government of UK is required to provide financial incentive to encourage the use
of energy efficiency lightning. Numerous studies have considered this program as the
primary step forward in the direction of lease cost utility planning (Adefarati and Bansal
2016). However, findings obtained from the study states that new policies needs abolishing
the financial rules that tilts the favour towards investment in supply so that customer end-use
efficiency can be improved.
Conclusion:
After conducting a detailed analysis, a conclusive evidence has been reached that
reduction in the peak demand and creating carbon cooling and heating with communal
practice would act as the vital tool in lowering the consumption of energy. The communal
and metropolitan level energy efficient technologies would assist in offering guidance for the
urban planning and applying the community design together with the energy management.
The analysis has bought forward an evidence that integration of the information,
communication and technologies of renewable energy at the building, communal and city
level intervention would assist in lowering the emission of energy.

11MANAGING ENERGY RESOURCES AND REGULATIONS
Reference List:
Adefarati, T. and Bansal, R.C., 2016. Integration of renewable distributed generators into the
distribution system: a review. IET Renewable Power Generation, 10(7), pp.873-884.
Alwash, S.F., Ramachandaramurthy, V.K. and Mithulananthan, N., 2015. Fault-location
scheme for power distribution system with distributed generation. IEEE Transactions on
Power Delivery, 30(3), pp.1187-1195.
Behrangrad, M., 2015. A review of demand side management business models in the
electricity market. Renewable and Sustainable Energy Reviews, 47, pp.270-283.
Capitanescu, F., Ochoa, L.F., Margossian, H. and Hatziargyriou, N.D., 2015. Assessing the
potential of network reconfiguration to improve distributed generation hosting capacity in
active distribution systems. IEEE Transactions on Power Systems, 30(1), pp.346-356.
Djapic, P., Tindemans, S. and Strbac, G., 2015. Comparison of approaches for quantifying
demand side response capacity credit for the use in distribution network planning.
Elmitwally, A., Elsaid, M., Elgamal, M. and Chen, Z., 2015. A fuzzy-multiagent service
restoration scheme for distribution system with distributed generation. IEEE Transactions on
Sustainable Energy, 6(3), pp.810-821.
Finn, P. and Fitzpatrick, C., 2014. Demand side management of industrial electricity
consumption: promoting the use of renewable energy through real-time pricing. Applied
Energy, 113, pp.11-21.
Gelazanskas, L. and Gamage, K.A., 2014. Demand side management in smart grid: A review
and proposals for future direction. Sustainable Cities and Society, 11, pp.22-30.

12MANAGING ENERGY RESOURCES AND REGULATIONS
Hattam, L., Greetham, D.V., Haben, S. and Roberts, D., 2017. Electric vehicles and low-
voltage grid: impact of uncontrolled demand side response. CIRED-Open Access
Proceedings Journal, 2017(1), pp.1073-1076.
Li, C., Yu, X., Yu, W., Chen, G. and Wang, J., 2017. Efficient computation for sparse load
shifting in demand side management. IEEE Transactions on Smart Grid, 8(1), pp.250-261.
Mahmoud, K., Yorino, N. and Ahmed, A., 2016. Optimal distributed generation allocation in
distribution systems for loss minimization. IEEE Transactions on Power Systems, 31(2),
pp.960-969.
Qadrdan, M., Cheng, M., Wu, J. and Jenkins, N., 2017. Benefits of demand-side response in
combined gas and electricity networks. Applied energy, 192, pp.360-369.
Schachter, J.A., Mancarella, P., Moriarty, J. and Shaw, R., 2016. Flexible investment under
uncertainty in smart distribution networks with demand side response: Assessment
framework and practical implementation. Energy Policy, 97, pp.439-449.
Sheng, W., Meng, X., Fan, T. and Du, S., 2016. Reliability evaluation of distribution system
considering sequential characteristics of distributed generation. In MATEC Web of
Conferences (Vol. 55). EDP Sciences.
Singh, E.P., Doolla, S. and Banerjee, R., 2017. Demand Side Management.
Spence, A., Demski, C., Butler, C., Parkhill, K. and Pidgeon, N., 2015. Public perceptions of
demand-side management and a smarter energy future. Nature Climate Change, 5(6), p.550.
Sweetnam, T., Fell, M., Oikonomou, E. and Oreszczyn, T., 2018. Domestic demand-side
response with heat pumps: controls and tariffs. Building Research & Information, pp.1-18.

13MANAGING ENERGY RESOURCES AND REGULATIONS
Teng, F., Aunedi, M., Pudjianto, D. and Strbac, G., 2015. Benefits of demand-side response
in providing frequency response service in the future GB power system. Frontiers in Energy
Research, 3, p.36.
Wu, Z., Tazvinga, H. and Xia, X., 2015. Demand side management of photovoltaic-battery
hybrid system. Applied Energy, 148, pp.294-304.
Yi, F., Yongxiang, L., Xiaomei, Z. and Lin, G., 2017, November. Power demand side
response potential and operating model based on EV mobile energy storage. In Energy
Internet and Energy System Integration (EI2), 2017 IEEE Conference on (pp. 1-6). IEEE.