Market Methods for Supply and Demand Management in the Smart Grid

This study addresses the resource management problem in a large scale networked system with high flexibility. We consider the supply and demand management problem specifically in the context of the future Smart Grid. On the supply side, we design a secondary market to provide stochastic energy service via distributed renewable energy resources. The performance of the proposed market is evaluated in two circumstances, i.e. whether or not the extra energy penetration caused by the market changes the operation point of the power grid. On the demand side, we would like to take the advantages of the residential demand flexibility to relieve consumption peaks and stabilize the system. We conduct certain demand response in a market approach and further build a real experiment system to analyze the performance of such regime. The study of supply side market is referred to the subheading: Small-Scale Markets for a Bilateral Energy Sharing Economy followed by an extension of the corresponding market which brings in the concern that the increased energy penetration may change the operation point of the grid. As for the demand side study, design and analysis of such demand response market is under the subheading: Mean Field Games in Nudge Systems for Societal Networks and the real experiment built-up is presented in Incentive-Based Demand Response: Empirical Assessment and Critical Appraisal. We model the agent behaviour in both markets via game theoretic approach and analyze the equilibrium performance. We show that a Mean Field Game regime can be applied to accurately approximate these repeated game frameworks and socially desirable equilibria that benefit both system operator and agents exist