A Stackelberg game for incentive-based demand response in energy markets

In modern buildings renewable energy generators and storage devices are spreading, and consequently the role of the users in the power grid is shifting from passive to active. We design a demand response scheme that exploits the prosumers' flexibility to provide ancillary services to the main g...

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Bibliographic Details
Published in:arXiv.org 2022-11
Main Authors: Fochesato, Marta, Cenedese, Carlo, Lygeros, John
Format: Article
Language:English
Subjects:
Ancillary services
Electric power demand
Electric power grids
Energy management
Energy storage
Game theory
Mathematical analysis
Optimization
Online Access:Get full text
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Summary:In modern buildings renewable energy generators and storage devices are spreading, and consequently the role of the users in the power grid is shifting from passive to active. We design a demand response scheme that exploits the prosumers' flexibility to provide ancillary services to the main grid. We propose a hierarchical scheme to coordinate the interactions between the distribution system operator and a community of smart prosumers. The framework inherits characteristics from price-based and incentive-based schemes and it retains the advantages of both. We cast the problem as a Stackelberg game with the prosumers as followers and the distribution system operator as leader. We solve the resulting bilevel optimization program via a KKT reformulation, proving the existence and the convergence to a local Stackelberg equilibrium. Finally, we provide numerical simulations to corroborate our claims on the benefits of the proposed framework.
ISSN:2331-8422