With DR, DG, storage and smart grid technologies we may be able to solve problems
such as network congestion, high transmission losses and supply variation from variable
generation, including wind power, run-of-river hydro power and CHP. It is difficult to
know by manual inspection how to implement them in a way so that we achieve a good
cost/benefit ratio. Analysis tools can help in making the right kind of investments at the
right time. After the investment has been made, different tools can help in operating the
resources in a way that the owner's and (hopefully) the system's benefits are maximized.
They can also show the physical effects of DER penetration on the network. Certain
tools can also be used for finding the right kind of incentives to promote investments,
taking into account their externalities and system security. Without these tools, we do
not yet understand the technical ramifications and consequences of such integration, nor
can we estimate the benefits from enacting policies to push integration faster.
The tools that we have considered are mainly high-level software tools, which, while not
absolutely necessary, can support decisions concerning energy policy and investments
and operation of DER. Some of the tools can also be connected into a larger automated
system including also hardware components such as meters. There are few tools which
have been built specifically for the analysis of integration of demand response with
distributed generation, storage, or smart grid technologies. However, many tools allow
the addition of a demand response and a distributed generation and/or a storage
component. When network effects such as congestion and losses are not considered,
demand response can be considered as one form of DG. Certain forms of DR and DG
also inherently contain energy storage