The impacts of decentralization as well as the high penetration of renewable energy resources into power systems have created a necessity to change the operation and management of the power systems in recent years. Although the effects of renewables at all power system levels can be seen, it is more likely to become an issue, especially in distribution networks due to the increased integration of small-scale renewable generation units (e.g. domestic PV panels). However, the output of renewable energy sources (RES) is naturally variable and intermittent in very short-term periods due to their dependency on environmental weather related factors. Therefore, there might exist a constant imbalance between generation and demand which results in the instability of the power system. In order to prevent these instabilities, the electrical systems must become more flexible, meaning that the system must respond to the probable fluctuations rapidly, consistently, and adequately. To do so, all the potential flexibilities in the electrical systems should be deployed. Thus, the flexible capacities have to be effectively managed and controlled in a smart way by the system operators including distribution system operators (DSO) and transmission system operators (TSO) [1].At the distribution system level, the flexible energy resources are mostly located in the demand side where the majority of consumers are generally residential households/areas. These flexible resources (which can include battery energy storage systems, electric vehicles, flexible loads, demand response, etc.) are able to contribute to enhancing the grid's flexibility by means of different operation and management methods. It is noticeable that in distribution networks, the complexity of the network and also the high amount of end-users and flexible resources worsen the process of dealing with all the end-users individually. Therefore, in order to unlock a considerable amount of flexibility in distribution networks, the system operators need to manage these flexibilities in an aggregated manner in order to be able to utilize them during critical situations. The aggregated management is possible with advanced ICT technologies such as smart management systems in homes or in energy communities with group of homes [2]. This chapter is focused on the role of smart homes and communities in providing demand-side flexibility to the grid. Several energy management methods and approaches for smart homes using home energy management systems (HEMS) for flexibility provision has been previously proposed [3]. These approaches are mostly based on demand-side management by providing dynamic prices to the rational end-users equipped with HEMS and/or taking advantage of demand response programs (DRPs). DRPs are mostly deployed to incentivize customers to react to external signals. The chapter will present the popular DRPs that can reshape the consumption pattern of smart homes and communities. In addition, the flexible resources of residential households and communities are discus...
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