IDEAS home Printed from https://ideas.repec.org/a/eee/energy/v126y2017icp132-143.html
   My bibliography  Save this article

Game-Theory based dynamic pricing strategies for demand side management in smart grids

Author

Listed:
  • Srinivasan, Dipti
  • Rajgarhia, Sanjana
  • Radhakrishnan, Bharat Menon
  • Sharma, Anurag
  • Khincha, H.P.

Abstract

With the increasing demand for electricity and the advent of smart grids, developed countries are establishing demand side management (DSM) techniques to influence consumption patterns. The use of dynamic pricing strategies has emerged as a powerful DSM tool to optimize the energy consumption pattern of consumers and simultaneously improve the overall efficacy of the energy market. The main objective of the dynamic pricing strategy is to encourage consumers to participate in peak load reduction and obtain respective incentives in return. In this work, a game theory based dynamic pricing strategy is evaluated for Singapore electricity market, with focus on the residential and commercial sector. The proposed pricing model is tested with five load and price datasets to spread across all possible scenarios including weekdays, weekends, public holidays and the highest/lowest demand in the year. Three pricing strategies are evaluated and compared, namely, the half-hourly Real-Time Pricing (RTP), Time-of-Use (TOU) Pricing and Day-Night (DN) Pricing. The results demonstrate that RTP maximizes peak load reduction for the residential sector and commercial sector by 10% and 5%, respectively. Moreover, the profits are increased by 15.5% and 18.7%, respectively, while total load reduction is minimized to ensure a realistic scenario.

Suggested Citation

  • Srinivasan, Dipti & Rajgarhia, Sanjana & Radhakrishnan, Bharat Menon & Sharma, Anurag & Khincha, H.P., 2017. "Game-Theory based dynamic pricing strategies for demand side management in smart grids," Energy, Elsevier, vol. 126(C), pages 132-143.
    • Handle: RePEc:eee:energy:v:126:y:2017:i:c:p:132-143
    DOI: 10.1016/j.energy.2016.11.142
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0360544216317996
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.energy.2016.11.142?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Hong, Seung Ho & Yu, Mengmeng & Huang, Xuefei, 2015. "A real-time demand response algorithm for heterogeneous devices in buildings and homes," Energy, Elsevier, vol. 80(C), pages 123-132.
    2. Min, C.G. & Kim, M.K. & Park, J.K. & Yoon, Y.T., 2013. "Game-theory-based generation maintenance scheduling in electricity markets," Energy, Elsevier, vol. 55(C), pages 310-318.
    3. Boisvert, Richard N. & Cappers, Peter A. & Neenan, Bernie, 2002. "The Benefits of Customer Participation in Wholesale Electricity Markets," The Electricity Journal, Elsevier, vol. 15(3), pages 41-51, April.
    4. Schreiber, Michael & Wainstein, Martin E. & Hochloff, Patrick & Dargaville, Roger, 2015. "Flexible electricity tariffs: Power and energy price signals designed for a smarter grid," Energy, Elsevier, vol. 93(P2), pages 2568-2581.
    5. Gao, Dian-ce & Sun, Yongjun & Lu, Yuehong, 2015. "A robust demand response control of commercial buildings for smart grid under load prediction uncertainty," Energy, Elsevier, vol. 93(P1), pages 275-283.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Meyabadi, A. Fattahi & Deihimi, M.H., 2017. "A review of demand-side management: Reconsidering theoretical framework," Renewable and Sustainable Energy Reviews, Elsevier, vol. 80(C), pages 367-379.
    2. Taimoor Ahmad Khan & Amjad Ullah & Ghulam Hafeez & Imran Khan & Sadia Murawwat & Faheem Ali & Sajjad Ali & Sheraz Khan & Khalid Rehman, 2022. "A Fractional Order Super Twisting Sliding Mode Controller for Energy Management in Smart Microgrid Using Dynamic Pricing Approach," Energies, MDPI, vol. 15(23), pages 1-14, November.
    3. Keon Baek & Woong Ko & Jinho Kim, 2019. "Optimal Scheduling of Distributed Energy Resources in Residential Building under the Demand Response Commitment Contract," Energies, MDPI, vol. 12(14), pages 1-19, July.
    4. Zhou, Dengji & Yu, Ziqiang & Zhang, Huisheng & Weng, Shilie, 2016. "A novel grey prognostic model based on Markov process and grey incidence analysis for energy conversion equipment degradation," Energy, Elsevier, vol. 109(C), pages 420-429.
    5. Elma, Onur & Selamogullari, Ugur Savas, 2015. "A new home energy management algorithm with voltage control in a smart home environment," Energy, Elsevier, vol. 91(C), pages 720-731.
    6. Osaru Agbonaye & Patrick Keatley & Ye Huang & Motasem Bani Mustafa & Neil Hewitt, 2020. "Design, Valuation and Comparison of Demand Response Strategies for Congestion Management," Energies, MDPI, vol. 13(22), pages 1-29, November.
    7. Froger, Aurélien & Gendreau, Michel & Mendoza, Jorge E. & Pinson, Éric & Rousseau, Louis-Martin, 2016. "Maintenance scheduling in the electricity industry: A literature review," European Journal of Operational Research, Elsevier, vol. 251(3), pages 695-706.
    8. Fridgen, Gilbert & Kahlen, Micha & Ketter, Wolfgang & Rieger, Alexander & Thimmel, Markus, 2018. "One rate does not fit all: An empirical analysis of electricity tariffs for residential microgrids," Applied Energy, Elsevier, vol. 210(C), pages 800-814.
    9. Kirkerud, Jon Gustav & Trømborg, Erik & Bolkesjø, Torjus Folsland, 2016. "Impacts of electricity grid tariffs on flexible use of electricity to heat generation," Energy, Elsevier, vol. 115(P3), pages 1679-1687.
    10. Rokhforoz, Pegah & Montazeri, Mina & Fink, Olga, 2023. "Safe multi-agent deep reinforcement learning for joint bidding and maintenance scheduling of generation units," Reliability Engineering and System Safety, Elsevier, vol. 232(C).
    11. Huang, Pei & Wu, Hunjun & Huang, Gongsheng & Sun, Yongjun, 2018. "A top-down control method of nZEBs for performance optimization at nZEB-cluster-level," Energy, Elsevier, vol. 159(C), pages 891-904.
    12. Yuchun Li & Yinghua Han & Jinkuan Wang & Qiang Zhao, 2018. "A MBCRF Algorithm Based on Ensemble Learning for Building Demand Response Considering the Thermal Comfort," Energies, MDPI, vol. 11(12), pages 1-20, December.
    13. Weitzel, Timm & Glock, Christoph H., 2018. "Energy management for stationary electric energy storage systems: A systematic literature review," European Journal of Operational Research, Elsevier, vol. 264(2), pages 582-606.
    14. Obara, Shin’ya & Nagano, Katsunori & Okada, Masaki, 2017. "Facilities introduction planning of a microgrid with CO2 heat pump heating for cold regions," Energy, Elsevier, vol. 135(C), pages 486-499.
    15. Papaefthymiou, Georgios & Haesen, Edwin & Sach, Thobias, 2018. "Power System Flexibility Tracker: Indicators to track flexibility progress towards high-RES systems," Renewable Energy, Elsevier, vol. 127(C), pages 1026-1035.
    16. Lee, Junghun & Yoo, Seunghwan & Kim, Jonghun & Song, Doosam & Jeong, Hakgeun, 2018. "Improvements to the customer baseline load (CBL) using standard energy consumption considering energy efficiency and demand response," Energy, Elsevier, vol. 144(C), pages 1052-1063.
    17. Lucas Roth & Özgür Yildiz & Jens Lowitzsch, 2021. "An Empirical Approach to Differences in Flexible Electricity Consumption Behaviour of Urban and Rural Populations—Lessons Learned in Germany," Sustainability, MDPI, vol. 13(16), pages 1-31, August.
    18. Gomez-Herrera, Juan A. & Anjos, Miguel F., 2018. "Optimal collaborative demand-response planner for smart residential buildings," Energy, Elsevier, vol. 161(C), pages 370-380.
    19. Khemakhem, Siwar & Rekik, Mouna & Krichen, Lotfi, 2019. "Double layer home energy supervision strategies based on demand response and plug-in electric vehicle control for flattening power load curves in a smart grid," Energy, Elsevier, vol. 167(C), pages 312-324.
    20. Huang, Pei & Sun, Yongjun, 2019. "A collaborative demand control of nearly zero energy buildings in response to dynamic pricing for performance improvements at cluster level," Energy, Elsevier, vol. 174(C), pages 911-921.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:energy:v:126:y:2017:i:c:p:132-143. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/energy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.