Energy Demand Forecasting Using Temporal Variational Residual Network

The growing demand for efficient energy management has become essential for achieving sustainable development across social, economic, and environmental sectors. Accurate energy demand forecasting plays a pivotal role in energy management. However, energy demand data presents unique challenges due to its complex characteristics, such as multi-seasonality, hidden structures, long-range dependency, irregularities, volatilities, and nonlinear patterns, making energy demand forecasting challenging. We propose a hybrid dimension reduction deep learning algorithm, Temporal Variational Residual Network (TVRN), to address these challenges and enhance forecasting performance. This model integrates Variational Autoencoders (VAEs), Residual Neural Networks (ResNets), and Bidirectional Long Short-Term Memory Networks (BiLSTM). TVRN employs VAEs for dimensionality reduction and noise filtering, ResNets to capture local, mid-level, and global features while tackling gradient vanishing issues in deeper networks, and BiLSTM to leverage past and future contexts for dynamic and accurate predictions. The performance of the proposed model is evaluated using energy consumption data, showing a significant improvement over traditional deep learning and hybrid models. For hourly forecasting, TVRN reduces root mean square error and mean absolute error, ranging from 19\% to 86\% compared to other models. Similarly, for daily energy consumption forecasting, this method outperforms existing models with an improvement in root mean square error and mean absolute error ranging from 30\% to 95\%. The proposed model significantly enhances the accuracy of energy demand forecasting by effectively addressing the complexities of multi-seasonality, hidden structures, and nonlinearity.