Not everybody responds to a signal — How to target more responsive customers with explainability

ENCORED
ENCORED
Jan 10, 2019 · 2 min read

15 Oct 2018

Highlights

  • A quantitative analysis of data-driven targeting in residential DR.
  • Explainability of data-driven actions and its relation to fairness.
  • Details of implementing credit scoring, which has good explainability, for DR.
  • A case study of incentive DR, where the DR was operated through a smartphone app.
  • Credit scoring can achieve comparable performance as machine learning methods.

Abstract

As data-driven innovation becomes a main trend in the energy sector, explainability of data-driven actions is becoming a major fairness issue for the residential applications, and it is expected to become a requirement for regulatory compliance. Explainability, however, often demands a sacrifice in prediction performance and affects the effectiveness of data-driven actions. In this study, we consider data-driven customer targeting in an incentive-based residential demand response program, and investigate the explainability-performance tradeoff when using simple-rule based machine learning, and credit scoring methods. Credit scoring, that has been a popular solution in the finance discipline for over 60 years, is a scorecard based modeling method that can surely provide explainability. We first provide the detailed steps of applying credit scoring to the demand response problem. Then, we use a dataset of 14,525 households obtained from a real demand response program and analyze two prediction problems — participation prediction and behavior change prediction. The results show that credit scoring can achieve comparable performance as the best-performing machine learning methods while providing full explainability. Our results suggest that credit scoring can be a promising explainability option for broader energy sector problems.

>> Download

ENCORED

Our service ENERTALK brings your energy usage information…

ENCORED

Written by

ENCORED

ENCORED brings your energy usage information on your mobile. Upgrade your energy experience with real-time information, available anytime anywhere.

ENCORED

ENCORED

Our service ENERTALK brings your energy usage information on your mobile. Upgrade your energy experience with real-time information, available anytime anywhere.

ENCORED

Written by

ENCORED

ENCORED brings your energy usage information on your mobile. Upgrade your energy experience with real-time information, available anytime anywhere.

ENCORED

ENCORED

Our service ENERTALK brings your energy usage information on your mobile. Upgrade your energy experience with real-time information, available anytime anywhere.

Welcome to a place where words matter. On Medium, smart voices and original ideas take center stage - with no ads in sight. Watch

Follow all the topics you care about, and we’ll deliver the best stories for you to your homepage and inbox. Explore

Get unlimited access to the best stories on Medium — and support writers while you’re at it. Just $5/month. Upgrade

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store