Impact of demand response in an isolated system with high PV penetration

The increasing need for flexibility in electrical networks to overcome renewable energy sources (RES) fluctuations calls for an active participation of the demand. In the present paper, the importance of adding short-term demand response to time-varying prices in systems with increasing stochastic generation penetration scenarios is stressed. Price signals delivered to the customers are obtained as dual variables of the demand balance equation for every hour. The high penetration of stochastic generation technologies means that the traditional correlation between energy matched and price is no longer valid under the actual remuneration scheme, neglecting adequate price signals for the customers. An example based on data from São Miguel Island in Azores (Portugal) shows the applicability of the study proposed.