Recent advancements in electric power sector increase the interest on smart grid technologies. In various smart grid techniques, demand side management is commonly preferred by many utilities to maintain the supply demand balance. Further, utilities motivate the end users to take part in energy society through demand response programme. Recently, government encourages the residential consumers to install small scale renewable power generation units to build self-sustainability as well as support the grid by exporting their excess generation to grid. Such users are referred to as prosumers. In this paper, a prosumer based demand response algorithm under real time pricing environment is proposed to improve the savings in electricity bill by optimally choosing the operational timing of household appliances with due consideration to user's desire and interest, intermittency in renewable power generation and utility dynamics. © 2018 IEEE.