Game Theoretic Real-time Pricing Based on Dual Decomposition and Its Application to Load Frequency Control of Power Networks

Abstract

This paper deals with game theoretic real-time pricing method based on dual decomposition and its application to load frequency control of power networks. The proposed pricing method in this study aims to solve the constrained optimization problem consist of each player's utility and social welfare under selfish players. Selfish player's decision is a Nash equilibrium solution considering their own cost functions. We show this method can lead their own decision to social welfare maximization. Finally we show the effectiveness of the proposed methodology for load frequency control by several simulation results.

Optimal Pricing Algorithm in the Electricity Market with Battery and Accumulator and Demand–Supply Balancing

“…In this paper, we consider the "day-ahead market", in which the tentative power generation volume and the transaction price of the next day are determined by the previous day. Because unmatched demand and supply of electric power causes destabilization of power systems [3,4], electricity must be priced so as to balance demand and supply of dispersed consumers and producers in the market.…”