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Demand Response With Capacity Constrained Supply Function Bidding

Xu, Yunjian and Li, Na and Low, Steven H. (2016) Demand Response With Capacity Constrained Supply Function Bidding. IEEE Transactions on Power Systems, 31 (2). pp. 1377-1394. ISSN 0885-8950. doi:10.1109/TPWRS.2015.2421932.

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We study the problem faced by an operator who aims to allocate a certain amount of load adjustment (either load reduction or increment) to multiple consumers so as to minimize the aggregate consumer disutility. We propose and analyze a simple uniform-price market mechanism where every consumer submits a single bid to choose a supply function from a group of parameterized ones. These parameterized supply functions are designed to ensure that every consumer's load adjustment is within an exogenous capacity limit that is determined by the current power system operating condition. We show that the proposed mechanism yields bounded efficiency loss at a Nash equilibrium. In particular, the proposed mechanism is shown to achieve approximate social optimality at a Nash equilibrium, if the total capacity limit excluding the consumer with the largest one is much larger than the total amount of load to be adjusted. We complement our analysis through numerical case studies.

Item Type:Article
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Low, Steven H.0000-0001-6476-3048
Additional Information:© 2015 IEEE. Manuscript received October 07, 2014; revised January 06, 2015; accepted April 01, 2015; date of publication May 01, 2015; date of current version February 17, 2016. This work was supported in part by the MIT-SUTD International Design Center (IDC) under Grant IDG21400103, the National Science Foundation NetSE under Grant CNS 0911041, ARPA-E under Grant DE-AR0000226, Southern California Edison, National Science Council of Taiwan, R.O.C , under Grant NSC 101-3113-P-008-001, and the Resnick Institute . Paper no. TPWRS-01373-2014.
Group:Resnick Sustainability Institute
Funding AgencyGrant Number
MIT-SUTD International Design Center (IDC)IDG21400103
NSF NetSECNS 0911041
Southern California EdisonUNSPECIFIED
National Science Council (Taipei)NSC 101-3113-P-008-001
Resnick Sustainability InstituteUNSPECIFIED
Subject Keywords:Demand response; efficiency loss; game theory; Nash equilibrium; renewable generation
Issue or Number:2
Record Number:CaltechAUTHORS:20160408-101533727
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Official Citation:Y. Xu, N. Li and S. H. Low, "Demand Response With Capacity Constrained Supply Function Bidding," in IEEE Transactions on Power Systems, vol. 31, no. 2, pp. 1377-1394, March 2016. doi: 10.1109/TPWRS.2015.2421932
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:66017
Deposited By: Melissa Ray
Deposited On:12 Apr 2016 23:49
Last Modified:10 Nov 2021 23:52

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