Incentivizing Intelligent Customer Behavior in Smart-Grids: A Risk-Sharing Tariff & Optimal Strategies
Proceedings of the Twenty-Fifth International Joint Conference on Artificial Intelligence. Pages 380-385.
Abstract
Current electricity tariffs for retail rarely provide incentives for intelligent demand response of flexible customers. Such customers could otherwise contribute to balancing supply and demand in future smart grids. This paper proposes an innovative risk-sharing tariff to incentivize intelligent customer behavior. A two-step parameterized payment scheme is proposed, consisting of a prepayment based on the expected consumption, and a supplementary payment for any observed deviation from the anticipated consumption. Within a game-theoretical analysis, we capture the strategic conflict of interest between a retailer and a customer in a two-player game, and we present optimal, i.e., best response, strategies for both players in this game. We show analytically that the proposed tariff provides customers of varying flexibility with variable incentives to assume and alleviate a fraction of the balancing risk, contributing in this way to the uncertainty reduction in the envisioned smart-grid.
@inproceedings{ijcai2016p61,
title = {Incentivizing Intelligent Customer Behavior in Smart-Grids: A Risk-Sharing Tariff & Optimal Strategies},
author = {Methenitis, Georgios and Kaisers, Michael and La Poutré, Han},
booktitle = {Proceedings of the Twenty-Fifth International Joint Conference on
Artificial Intelligence, {IJCAI-16}},
publisher = {AAAI Press / International Joint Conferences on Artificial Intelligence},
editor = {Subbarao Kambhampati},
pages = {380--385},
year = {2016},
month = {7},
url = {https://ijcai.org/proceedings/2016/61},
}
TY - CPAPER TI - Incentivizing Intelligent Customer Behavior in Smart-Grids: A Risk-Sharing Tariff & Optimal Strategies AU - Methenitis, Georgios AU - Kaisers, Michael AU - La Poutré, Han T2 - Proceedings of the Twenty-Fifth International Joint Conference on Artificial Intelligence, IJCAI-16 PB - AAAI Press / International Joint Conferences on Artificial Intelligence PY - 2016 SP - 380 EP - 385 UR - https://ijcai.org/proceedings/2016/61 ER -Copied
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