System Dynamics Model for Demand Side Management

With the development of power market, demand side management (DSM) should be paid more attention to improve the shape of load curve and the growth of peak load. In the implementation of DSM, the key is how to design electricity price arranged between an electricity supply utility and its customers for providing sufficient financial incentives. This paper utilizes system dynamics theory to establish the dynamic model of demand side management, which consists of internal and external structure among the power demand, the two-part electricity price, the output value of customers, technology development and economic situation based on computer simulation of many differential equations with feedback and time delays. By using this model, the policies of electricity price, such as the ratio of capacity and energy fees in the two-part electricity price, the ratio of peak and valley time price in the time-of-use electricity price are analyzed and proposed