The adoption of smart grid systems has been accelerating around the world, with many pilot projects initiated throughout the developed world. However, there has been a lack of studies quantifying appliance level economic benefits that are available to the end consumers. Through coupling historical market information with an agent based residential load model, this study has quantified the economic benefits of residential smart grid participation in ancillary electricity markets. In this study, we looked at the energy market of Singapore. The regulation and reserve ancillary electricity markets were examined and the associated economic benefits from market participation were assumed to be fully passed on to the consumers. A lesson is that the potential returns for consumer investment in smart appliance technology could be very low. No matter which market that the aggregator participates in, the corresponding credits that a single appliance can earn for the consumer through ancillary markets may not be attractive enough for the consumer. Although there could be other cost saving options such as dynamic electricity prices which could be complementary to such schemes; this result highlights the fact that economic benefits alone may not be attractive enough for smart appliance adoption in the current local policy climate.
- Agent-based modeling
- Ancillary electricity markets
- Smart appliances
- Smart grid