Volume 18: Sustainable Energy Solutions for a Post-COVID Recovery towards a Better Future: Part I

Market Mechanism to Assess Demand Response Programs during the Energy Transition in the Wholesale Electricity Market of the Dominican Republic Máximo A. Domínguez-Garabitos, Adriana Arango-Manrique, Víctor S. Ocaña-Guevara, Félix Santos-García, René Báez-Santana

Abstract

Modeling techniques have shown that fossil generation can be complemented with renewables and resources capable of providing flexibility in the operation of the system, according to the rules of the electricity market. In order to involve flexible demand, a market scheme is proposed that encourages it and that its adequacy allows the conditions to increase renewable participation to contribute to the reduction of CO2 emissions. The model tested indicates that by shifting 10.49% from the peak to the off-peak block of the curve, an additional 5% increase in renewable penetration is obtained, and a reduction in the cost of supply of 8.4%. Considering a variation of emissions cost from 0 to 10 $/Ton of CO2, the cost of supply increases to 16.03%, with a renewable participation of 12%. And the cost of supply improves by 7.27% when the penetration of renewables reaches 17%. According to the verified results, this tool is useful to evaluate the system operation programs and their effects on the market, contributing to decision-making for selecting the best operational scenarios, especially when subsidy and quality service problems are underlying.

Keywords CO2 emissions, demand response, elasticity of substitution, energy policy, renewable energy, wholesale electricity market