A smart grid demonstration project is currently underway in the island of Jeju. The ability to collect and transmit real-time data as well as measurement devices permitting two-way communication allow for remote reading and greater demand-side participation. Smart meters also offer a broader set of tariffs based on real-time prices. Distributed energy resources are small-scale power generation technologies (typically in the range of 3 to 10 000 kW) located close to where electricity is used (e.g. a home or business) to provide an alternative to or an enhancement of the traditional electric power system (California Energy Commission, 2008).