A Game Theoretic Optimization Framework for Home Demand Management Incorporating Local Energy Resources

Abstract

Facilitated by advanced information and communication technologies (ICT) infrastructure and optimization techniques, smart grid has the potential to bring significant benefits to the energy consumption management. This paper presents a game theoretic consumption scheduling framework based on the use of mixed integer programming (MIP) to schedule consumption plan for residential consumers. In particular, the optimization framework incorporates integration of locally generated renewable energy in order to minimize dependency on conventional energy and the consumption cost. The game theoretic model is designed to coordinatively manage the scheduling of appliances of consumers. The Nash equilibrium of the game exists and the scheduling optimization converges to an equilibrium where all consumers can benefit from participating in. Simulation results are presented to demonstrate the proposed approach and the benefits of home demand management.