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Non-Cooperative Game in Block Bidding Markets Considering Demand Response

Author

Listed:
  • Ningxuan Guo

    (College of Electrical Engineering, Zhejiang University, Zheda Rd. 38, Hangzhou 310027, China)

  • Yinan Wang

    (State Grid Energy Research Institute Co., Ltd., Changping District, Beijing 102209, China)

  • Gangfeng Yan

    (College of Electrical Engineering, Zhejiang University, Zheda Rd. 38, Hangzhou 310027, China)

  • Jian Hou

    (School of Information Science and Technology, Zhejiang Sci-Tech University, Hangzhou 310018, China)

Abstract

With the reform of electricity markets, demand response (DR) plays an important role in providing flexibility to the markets. Block bidding market is a new market mode, which is based on the concept of “the same quality, the same price”. The mechanism has great effects in reducing start-stop related costs. In this paper, we propose a double-sided non-cooperative game model in block bidding markets with a DR program. The model combines the advantages of block bidding and the simplicity of hourly bidding. In the model, one side is the non-cooperative game of supply-side power firms, and we propose a novel supply function bidding model based on block duration and load capacity to maximize each firm’s profit. The other side is the demand-side different types of customers, and we propose a DR model that combines hourly-various prices with the block bidding mechanism to maximize each customer’s payoff. The overall market optimization problem is solved by a distributed iterative algorithm, which has great convergence performance. We verify the proposed model on real data, and the results show that the demand load curve becomes flattened with DR, and the total generation costs decrease while the social welfare is significantly improved.

Suggested Citation

  • Ningxuan Guo & Yinan Wang & Gangfeng Yan & Jian Hou, 2020. "Non-Cooperative Game in Block Bidding Markets Considering Demand Response," Energies, MDPI, vol. 13(13), pages 1-18, June.
    • Handle: RePEc:gam:jeners:v:13:y:2020:i:13:p:3322-:d:377992
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    References listed on IDEAS

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    Cited by:

    1. Duan, Jiandong & Liu, Fan & Yang, Yao, 2022. "Optimal operation for integrated electricity and natural gas systems considering demand response uncertainties," Applied Energy, Elsevier, vol. 323(C).

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