Sharif University of TechnologyScientia Iranica1026-3098Articles in Press20201102Load Shifting Demand Response in Energy Scheduling Based on Payment Cost Minimization Auction Mechanism2206910.24200/sci.2020.54864.3948ENHamedJafariradDepartment of Electrical Engineering, Kerman Graduate University of Technology, Kerman, IranMasoudRashidinejadDepartment of Electrical Engineering, Shahid Bahonar University of Kerman, Kerman, IranAmirAbdollahiDepartment of Electrical Engineering, Shahid Bahonar University of Kerman, Kerman, IranJournal Article20191120Demand response (DR) is proven to be very efficacious for load mitigation especially in peak time period. On the other hand, DR facilitates both consumers, system operator as well as producers to moderate their payments while reducing system operating costs. Offer cost minimization is currently used as the clearing mechanism associated with locational marginal pricing scheme to determine the consumersâ€™ payments. Such clearing and pricing mechanisms are inconsistent as the system costs is being minimized, while the payments are calculated based upon marginal prices. Payment cost minimization auction as a price-based clearing mechanism is envisaged to be an effective alternative to solve such a crucial issue. This paper shows how to include DR in PCM mechanism to further reduce the consumersâ€™ payment. It facilitates utilizing price responsive consumers for load shifting DR in a PCM auction. The optimization problem is modeled as a mixed-integer nonlinear bi-level programming. Duality theorem, KKT conditions and integer algebra are used to convert such a complicated optimization problem to a single level MILP problem. This problem is then solved by CPLEX in GAMS. The impacts are studied by implementing the proposed formulation to solve the clearing problem in the case studies deriving promising numerical results.http://scientiairanica.sharif.edu/article_22069_58436a49e531b6e995371ff0678675ec.pdf