Demand response (DR) has become an impressive option in the deregulated power system due to its features of availability, quickness and applicability. In this paper, a novel economic dispatch model integrated with wind power is proposed, where incentive-based DR and reliability measures are taken into account. Compared with the conventional models, the proposed model considers customers’ power consumption response to the incentive price. The load profile is optimized with DR to depress the influence on the dispatch caused by the anti-peak-shaving and intermittence of wind generation. Furthermore, a probabilistic formulation is established to calculate the expected energy not supplied (EENS). This approach combines the probability distribution of the forecast errors of load and wind power, as well as the outage replacement rates of units into consideration. The cost of EENS is added into the objective to achieve an optimal equilibrium point between economy and reliability of power system operation. The proposed model is solved by mixed integer linear programming (MILP). The applicability and effectiveness of this model is illustrated by numerical simulations tested on the IEEE 24-bus Reliability Test System.
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