Benchmarking reservoir computing for residential energy demand forecasting

In the energy sector, accurate demand forecasts are vital but often limited by the available computational power. Reservoir computing (RC) or echo-state networks excel in chaotic time series prediction, with lower computational requirements compared to other recurrent network based methods like LSTMs. Next-generation reservoir computing (NG-RC) is a newer, more efficient variant of classical RC originating from nonlinear vector autoregression and therefore missing the randomness of classical RC. In our study, we evaluate RC and NG-RC for day-ahead energy demand predictions on four data sets and compare it to LSTMs and a naive persistence approach. We find that NG-RC outperforms all other methods when considering the root mean squared error on all data sets but struggles with very small or zero demands. Additionally, it offers a very computationally effective hyperparameter optimization and excels in replicating the inherent volatility and the erratic behavior of energy demands.