Online pricing for demand‐side management in a low‐voltage resistive micro‐grid via a Stackelberg game with incentive strategies

Abstract

It has been demonstrated that online pricing mechanisms are a viable solution for demand side management in power systems. This study deals with the analysis and design of a droop-controlled low-voltage resistive AC micro-grid network system. Such a system is subjected to a dynamic demand obtained from an online pricing mechanism, which is proposed as a novelty in the study of micro-grids. This mechanism is derived from a variation of the Stackelberg game, which includes the use of incentive strategies. First, a configuration in which a supplier announces an incentive function and (Formula presented.) -consumers’ reaction to the resulting personalised price is presented. Then, a detailed stability analysis of the micro-grid is presented as a result of the interaction with the aforementioned online pricing mechanism. The units of the micro-grid (generators as the supplier and loads as the consumers) operate under either conventional or bounded droop control. The novelty of the approach is that it bridges the gap between the physical and the market layers of the problem. The ways in which the existence of multiple equilibrium points is guaranteed for both the consumer's load and the supplier's announced incentive are shown. A detailed design process for the profit functions of the players is shown in conjunction with the parameter selection for their implementation. Finally, simulations that demonstrate the system stability and its convergence to different equilibria are implemented under scenarios with one and multiple consumers