Incentive Interruptible Load Management Considering Risk Factors

In electricity market, load management refers to utility activities that influencecustomer's demand of energy, aiming at modifying the shape of the load curve. But theinformation asymmetries between utilities and customers may cause inefficiencies ininterruptible load management (ILM). Considering risk preference of utilities, anincentive interruptible load contract model for discrete customer types is developed byuse of mechanism design. The proposed model can lead customers to voluntarily revealtheir true information and thereby maximizing the utility's benefit, in the meantime,power resources can be efficiently allocated. The proposed model would be a powerfultool especially for risk-taken distribution companies in the participation of marketcompetition and in the management of the risk. This paper also focuses on thedevelopment of implementation for interruptible load procurements in an unimplementedarea. It would be offer a new thinking for utilities to participate the market competition.