A Stackelberg Game for Multi-Period Demand Response Management in the Smart Grid
Abstract
This paper studies a multi-period demand response management problem in the smart grid where multiple utility companies compete among themselves. The user-utility interactions are modeled by a noncooperative game of a Stackelberg type where the interactions among the utility companies are captured through a Nash equilibrium. It is shown that this game has a unique Stackelberg equilibrium at which the utility companies set prices to maximize their revenues (within a Nash game) while the users respond accordingly to maximize their utilities subject to their budget constraints. Closed-form expressions are provided for the corresponding strategies of the users and the utility companies. It is shown that the multi- period scheme, compared with the single-period case, provides more incentives for the users to participate in the game. A necessary and sufficient condition on the minimum budget needed for a user to participate is provided.
Keywords
Cite
@article{arxiv.1509.03252,
title = {A Stackelberg Game for Multi-Period Demand Response Management in the Smart Grid},
author = {Khaled Alshehri and Ji Liu and Xudong Chen and Tamer Başar},
journal= {arXiv preprint arXiv:1509.03252},
year = {2016}
}
Comments
Accepted for Proc. 54th IEEE Conference on Decision and Control