Ordering Electricity via Internet and its Potentials for Smart Grid Systems

The Internet has evolved into a ubiquitous communication medium for information exchanges, services requests, and commodity purchasing. This paper proposes the concept, architecture, and the customer incentives for implementing a new demand-side management system called Online Purchase Electricity Now (OPEN). The new system allows customers to directly order the electricity via the Internet as if purchasing a book online. Utility companies, after consolidating the customers' orders, decide an optimal generation and distribution scheme to satisfy customers' demands. The time epoch between the customers' order and the actual generation acts as the lead time during which virtual energy will be scheduled for production. Such a virtual energy provisioning system can improve the reliability and stability of the electric grid which is increasingly integrated with distributed energy resources. Bayesian theory, hypothesis testing, and dynamic pricing are employed to justify the feasibility and applicability of the OPEN system.