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Real-Time Pricing Decision Based on Leader-Follower Game in Smart Grid

Author

Listed:
  • Dai Yeming

    (School of Management, University of Shanghai for Science and Technology, Shanghai200093, China;)

  • Gao Yan

    (School of Management, University of Shanghai for Science and Technology, Shanghai200093, China;)

Abstract

The real-time pricing plays an important role in demand-side management for smart grid. In this paper, we study real-time pricing strategy of electricity retailers by means of game theory in smart grid. The retailers are in the game situation where there is one leader with multi-followers. We propose a real-time electricity demand function and analyze the interactions between the retailers, then obtain its equilibrium solution. The analysis and simulation results of the equilibrium solution show the effectiveness of the proposed method.

Suggested Citation

  • Dai Yeming & Gao Yan, 2015. "Real-Time Pricing Decision Based on Leader-Follower Game in Smart Grid," Journal of Systems Science and Information, De Gruyter, vol. 3(4), pages 348-356, August.
    • Handle: RePEc:bpj:jossai:v:3:y:2015:i:4:p:348-356:n:5
    DOI: 10.1515/JSSI-2015-0348
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    References listed on IDEAS

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    1. van Damme, Eric & Hurkens, Sjaak, 1999. "Endogenous Stackelberg Leadership," Games and Economic Behavior, Elsevier, vol. 28(1), pages 105-129, July.
    2. van Damme, Eric & Hurkens, Sjaak, 1999. "Endogenous Stackelberg Leadership," Games and Economic Behavior, Elsevier, vol. 28(1), pages 105-129, July.
    3. Stephen P. Holland & Erin T. Mansur, 2008. "Is Real-Time Pricing Green? The Environmental Impacts of Electricity Demand Variance," The Review of Economics and Statistics, MIT Press, vol. 90(3), pages 550-561, August.
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