Abstract: With the major changes in the energy and load structure of the receiving power grid, the problem of transformer capacity shortage in the substation area has become increasingly prominent, while the traditional capacity increase method has the disadvantages of economy or operability. The massive flexible load on the demand side has huge potential for flexible adjustment,it can reduce the peak load of the substation area by reasonably optimizing the flexible load operation mode to achieve the effect of virtual capacity expansion of the substation area. For this reason, this paper constructs a typical flexible load operation model based on the widely existing air conditioning load and electric vehicle charging load on the demand side. Then, puts forward the basic concept of virtual capacity expansion in the substation area, fully considering the indexes of new energy consumption, user satisfaction and other indicators in the substation area, proposes a multi-objective joint scheduling model based on demand-side flexibility resources. Finally, the multi-objective optimization problem is transformed into a series of single-objective optimization models by the normal boundary crossing method. The example test verifies that the proposed method can alleviate the problem of capacity shortage in the station area and achieve rapid and low-cost virtual capacity expansion in the station area.