An interactive approach to demand side management based on utility functions

Abstract

Computational markets have been suggested as a solution to resource allocation, scheduling, and optimization problems. This paper describes how computational markets can be used to handle the application of demand side management. Demand side management enables electric power companies to reduce peak loads and thereby save money. A load is any device that consumes electric energy in this situation. Due to the large number of different loads, demand side management is a complicated optimization problem. The authors present a new interactive approach to this problem by using utility functions of electric power marketers. This approach provides an online estimation of the functions. In addition to them, it can deal with time-variable tendency of customers.