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Özge Karasu Özge Karasu

Curiosity leads me. I follow and write.

Green Energy Demand Forecasting with Volatility-Aware LSTM

16.08.2025

Background

Forecasting renewable energy dynamics is crucial for designing smarter and more sustainable grids.
Most studies separately analyse energy consumption or renewable production, but rarely combine them into a unified measure of Green Energy Demand (GED), the proportion of electricity consumption that can be met by renewables.

This project introduces a new daily-resolution GED dataset for the UK (2000–2023), overcoming the lack of fine-grained data in official statistics (which are usually monthly or yearly). The dataset integrates:

  • Energy consumption and generation (renewable + non-renewable)
  • Weather features (temperature, wind, solar, daylight)
  • Electricity prices

Research Goals

  1. Construct a daily GED dataset from heterogeneous sources.
  2. Benchmark classical forecasting methods (ARIMA, SARIMAX + GARCH).
  3. Develop deep learning models capable of handling long-term seasonality and short-term volatility.
  4. Evaluate performance with and without solar energy inputs, which introduce strong fluctuations.

Methodology

  • ARIMA (5,0,2): Univariate baseline, capturing medium-term autocorrelations.
  • SARIMAX + GARCH: Incorporated exogenous weather and market variables, then modelled residual volatility.
  • Baseline LSTM: One-branch recurrent neural network with 30-day input windows.
  • Fourier-Based Dual-Branch LSTM with Attention:
    • Trend branch: Seasonal patterns represented by Fourier-transformed GED.
    • Residual branch: Weather and price features (with solar inputs in some configurations).
    • Attention fusion: Learnable weighting to adaptively balance trend and volatility signals.

Results

  • ARIMA: Smooth forecasts but failed to capture volatility (R² = –1.17).
  • SARIMAX + GARCH: Performed well without solar (R² ≈ 0.49) but collapsed when solar inputs were included.
  • Baseline LSTM: Reasonable at seasonal trends but underfit volatility (R² ≈ 0.06).
  • Fourier-Based Dual-Branch LSTM with Attention:
    • Best-performing model, especially with solar inputs (R² ≈ 0.63).
    • Trend branch captured long-term seasonality.
    • Residual branch handled short-term, weather-driven fluctuations.
    • Attention allowed the model to dynamically weigh both signals.

Contributions

  • Introduced a new high-resolution GED dataset for the UK.
  • Proposed a volatility-aware hybrid deep learning model combining Fourier decomposition, dual-branch LSTM, and attention fusion.
  • Demonstrated that treating solar features through a dedicated residual pathway avoids overfitting and improves robustness.

Impact

This framework shows that hybrid, volatility-sensitive models can outperform traditional methods in forecasting renewable energy demand. Such models are highly relevant for:

  • Sustainable grid planning
  • Demand-side management
  • Integration of renewables under uncertain and volatile conditions.