Energy pricing and demand scheduling in retail market: how microgrids’ integration affects the market

This study proposes a single‐leader‐multi follower game to model a bilevel retail market among an aggregator and multiple microgrids to determine the optimal demand scheduling of the consumer, as well as price‐power bidding strategies of microgrids in an interactive scheme. In the lower level, micro...

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Bibliographic Details
Published in:IET smart grid Vol. 3; no. 3; pp. 309 - 317
Main Authors: Ahmadi, Fatemeh, Akrami, Alireza, Doostizadeh, Meysam, Aminifar, Farrokh
Format: Journal Article
Language:English
Published: Durham The Institution of Engineering and Technology 01.06.2020
John Wiley & Sons, Inc
Wiley
Subjects:
aggregator
B0240E Game theory
B0260 Optimisation techniques
B8110B Power system management, operation and economics
B8120K Distributed power generation
bilevel optimisation
bilevel retail market
Competition
Consumers
Decision making
Demand
demand side management
distributed energy resources
Distributed generation
distributed power generation
energy dispatch
energy payment
Energy sources
Energy storage
energy storage units
Game theory
generation units
individual profit
Integer programming
interactive scheme
interruptible loads
Karush–Kuhn–Tucker optimality condition
Linear programming
Markets
mixed-integer linear programming problem
multiple microgrids
optimal demand scheduling
optimal energy-price bids
Optimization
Power
Power dispatch
power generation economics
power generation scheduling
power markets
price-power bidding strategies
Prices
Pricing
profitability
real-time pricing
retail market clearance mechanism
Scheduling
shiftable loads
single-leader-multifollower game
Smart grid technology
Stackelberg game
Storage units
upper-level problem
Utility functions
ISSN:2515-2947, 2515-2947
Online Access:Get full text
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Summary:This study proposes a single‐leader‐multi follower game to model a bilevel retail market among an aggregator and multiple microgrids to determine the optimal demand scheduling of the consumer, as well as price‐power bidding strategies of microgrids in an interactive scheme. In the lower level, microgrids which include several distributed energy resources and energy storage units, compete with each other and offer the optimal energy‐price bids such that their individual profit is maximised, while energy dispatch among their energy resources is also determined. Then, in the upper‐level problem, the aggregator leads the competition taking advantages of demand‐side management including interruptible and shiftable loads to minimise its energy payment for real‐time pricing of generation units. By means of Karush–Kuhn–Tucker optimality condition, the bilevel optimisation of Stackelberg game is reduced to a single‐level mixed‐integer linear programming problem. Moreover, impact of microgrids’ integration on the retail market clearance mechanism, as well as required incentives for such integration has been discussed in a separate scenario.
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ISSN:2515-2947
2515-2947
DOI:10.1049/iet-stg.2019.0195