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An Efficient Energy Management in Microgrid: A Game Theoretic Approach

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An Efficient Energy Management in Microgrid: A
Game Theoretic Approach
Omaji Samuel1, Nadeem Javaid1, Zahoor Ali Khan2,
1COMSATS University Islamabad, Islamabad 44000, Pakistan
2Computer Information Science, Higher Colleges of Technology, Fujairah, United Arab
Corresponding author:
Abstract—Presently, power systems have the capacities to
accommodate different framework for incorporating economic
dispatch, transmission, storage, and electricity consumption. This
can provide an efficient energy management for controlling,
coordinating, planning and operations. This paper focuses on
coordinating the behaviors of a typical energy management of
microgrid which is an issue on energy interconnections. A setup
of microgrid, electricity users, storage and utility company is
designed. Initially, the optimal solution is formulated as a three
stage Stackelberg game in which each player is allowed to
maximize its payoffs, while ensuring load stability and reliability.
The method of backward induction is applied to examine the
non cooperative game problem. We further proposed an efficient
Jaya-based conditional restricted Boltzmann machine for micro-
grid power output forecasting which enables the microgrid to
make a strategic decision. Simulation results validate the fact
that accurate prediction of renewable energy can influence the
choice of microgrid strategies.
Index Terms—Energy management, Stackelberg game, Load
CRISES will continue to increase if environmental and
worldwide energy are not tackled with robust large scale
energy sources. These large scale energy resources are not
solely obtained from conventional power system but with mi-
crogrid technology. Conventional power systems are described
by it centralized and unidirectional energy flow and generation
and is not adaptable for high-level distributed and diversified
renewable energy sources (RES) [1]. Microgrid on the other
hand, is in miniature of power system which consists of load
and distributed resources, and can function as stand-alone or
grid-connected mode [2]. Nowadays, several types of emerging
demand-side resources can be found in microgrid, including
thermostatic appliances and electric vehicles, which enhance
the operations of microgrid. The relevances of renewable
energy penetration on the distribution systems are multi fold:
firstly, the renewable energy used at the point of production
helps to support local energy demand, which enhances the
reliability and minimizes the pressure on power grid; secondly,
renewable energy ensures emission free environmental friend-
liness via utilizing renewable energy-fueled generators; finally,
microgrid supplies energy demand through local distributed
generators and also reduces the transmission power loses due
to long distances as well as procurement cost on transmission
lines and large scale transformers.
Presently, power industry is constantly witnessing high pen-
etration of renewable energy, which brings in mind the concept
of multi-microgrid to denote cluster of several microgrids
either by close electrical or spatial distance [2]. The objective
is to integrate large distributed energy resource penetration to
the power system. It also include high resilience and stability
through fast energy exchange which remove the monopoly of
energy distribution owned by state over sales of energy. Multi-
microgrid architecture like the conventional power system
operates based on time period of certain operation rules (i.e.,
planning and operation) [3], architecture of multi-microgrid
in terms of interface and layout based on cost are discussed
in [4]. In addition, architecture of multi-microgrid based on
system of systems is discussed in [5] to formulate bi-level
optimization problem which handled individual microgrid as
multiple stage robust optimization with uncertainty in RES.
Others includes hierarchical control strategies which involve
primary droop-control of power electronic device, secondary
control of active and real power; and finally, energy manage-
ment system formulated as economic dispatch (ED) problem
that minimizes economic profit.
ED deals with economic consideration of power system in
terms of generation units. Nowadays, several literature studies
the ED single and multi-objectives that solved optimal power
flow problem through meta-heuristic techniques [6], [7]. In
respect to multi-microgrid operations, numerous work focus on
two adoptable approaches that coordinate multi-microgrid ED
such as decentralized and centralized approach. The objective
of the later approach is to incorporate the entire entities into
the system as single entity with overall objectives. The cen-
tralize system organizes and coordinates the operations of all
distributed generators in respective of their distinct objectives.
Ref [8] proposes hybrid interactive communication optimiza-
tion solution to solve microgrids’ plug-in and plug-out opera-
tions. The hybrid consists of two layers; upper layer performs
distributed control between multi-microgrids with no central
control; whereas, lower layer performs centralized controlling
of individual microgrid. Optimal information exchange is
achieved via flexible communication links among microgrids.
Ref [9] proposes a model predictive control scheme for multi-
microgrids energy management via coordination of individual
microgrids operations in an economic way through balancing
system-wide demand and supply. Chebyshev inequality and
delta method are applied to handle uncertainties of demand
and supply into quadratic and nonlinear programs. Ref [10]
presents a comprehensive evaluation of disparate microgrids
by applying mixed integer linear programming for yearly
simulations. They analyze short term daily operational cost
by using receding horizon model predictive control algorithm.
The aim of this scheme is to optimize flow of different energy
generators; to coordinate each microgrids entities and energy
exchange with the rest entity. In order to minimize the com-
plexities and computational efficiency, decentralized economic
dispatch of multi-microgrids is implemented in [11]–[14] to
reduce the operating cost, network complexity, improve effi-
ciency of storage usage. However, there exists limitations with
the above proposed models. The centralized technique requires
complete communication for all entities within the network.
However, it may not be scalable for plug and play distributed
energy resources, i.e., electric vehicle. Decentralized technique
is concerns about the individual goals of each entity which
does not guarantee global optimum. Thus, the conflict of
interests between the centralized and decentralized techniques
may push microgrids away from coordination. The focus of
this paper is to propose a non cooperative game approach that
capture the dynamic interconnections among utility company,
storage company, multi-microgrids and electricity users.
Cooperative and non cooperative game formed the fun-
damental building blocks of game theory. Each game is
concerned about reaching a balanced status in which no
player can make further adjustment of their strategies denoted
as Nash equilibrium for the later and core status for the
former [2]. In cooperative game, global optimum is achieved
via coalition optimization model. Afterward, cost allocation
model is setup for fair distribution of profit to each individual
player. Hence, we can conclude that cooperative game is best
suitable for coordinated operation of multi-microgrids which
resolves conflicting interest among stakeholders (i.e, global
and local). Several work in the field of power system such as
transmission cost allocation, revenue sharing use the coopera-
tive game [15]–[20]. The cooperative game theory via nucleoli
concept is applied in [21], Shapely value concept is examined
in [23]. Whereas, a survey on smart grids’ game theoretic
methods are discussed in [22]. However, fewer application
of cooperative game in multi-microgrid coordinated operation
has not gained full exploration, in this regard, the authors
in [2] propose a cooperative game for coordinating multiple
microgrid operations using the bender decomposition (BD).
However, BD has not been extended to multiple objectives
which also requires several iterations to converge. On the
other hand, payoff of individual player in non cooperative
game depends on getting the maximum independent payoff.
However, global welfare is ignored. In retrospect, non coop-
erative game have not gain much exploration in field of smart
grid. Bingtuan et al. [30] propose a non cooperative game
theoretic method that optimizes storage capacity and energy
consumption. In addition, the method has a single photovoltaic
(PV) array which allows each user to own a PV-storage system
and can trade with grid where there is surplus; however,
there is no coalition among users which may compromise,
cause conflict and resentment. More so, a fair energy sharing
is not considered. Zhou et al. [29] demonstrates that the
inner variation of energy with the microgrids’ outer energy
exchange can be formulated using non cooperative game.
However, the principle of proportional sharing proposed to
assign energy trading among sellers and buyers lack physical
and economical justification since the intermittent behaviors
of microgrids may indicate that the proposed strategies to
maximize the payoff may not be technically satisfactory as it
do not considered the correlation between microgrids behavior
and its generation. Zhenyu et al. [1] propose three-stage
Stackelberg game for energy management with big data-based
renewable power prediction. However, the genetic algorithm
proposed for wind load forecast is inefficient due to the
following reasons: computation complexity may occur if the
sample size increases; selecting wrong crossover probability
value can make the population change slowly, thus, it may not
be effective to explore all possibilities; choosing high mutation
value may produce individual that is totally different from the
main population; and finally it may lead in slow convergence
since only the fitted candidates are selected. In Liu et al. [26],
net power profile of the energy sharing network is enhanced
via a stochastic programming where the uncertainty of prices
, prosumer load and PV energy are considered. In order to
illustrate the energy consumption behavior of prosumer via
internal prices a Stackelberg game is used. However, this work
only considered the commercial and industrial prosumer while
ignoring the residential PV prosumer which we belief to have
the highest participant. Chen et al. [27] present a Nash equilib-
rium concept for the non cooperative game in order to examine
the strategic behavior of distributed microgrid. They consider
the economic factors, stability and efficiency of microgrid,
voltage angle regulations and power flow constraints. However,
the framework does not consider the generators as the leader
in Stackelberg game, storage dynamic and also to derive the
optimal power policies for scheduling players.
This paper focuses on the efficient and effective energy
usage of the RES. Due to the distribution energy management
problem which has multiple conflicting objective functions.
This paper aim at maximizes each objective function of the
active market player while ensuring power balancing and
reliability and also satisfying the electricity users demand.
Although, uncertainties exist in the RES that is uncontrollable,
we apply forecasting technique to obtain the short-term pre-
dictive value via deep learning approach. The contributions of
this paper are summarized as below:
1) A suitable framework is proposed using the three stage
Stackelberg to formulate uncertainty of microgrid’s deci-
sion making problems. It capture the dynamic interaction
and interconnection among power components. The first
stage is made up storage, utility company which act
as leaders of the microgrid, announces their electricity
prices to the microgrid. In the second stage, microgrid
acts as the leader of the electricity users and follower of
storage and utility company, adjust it strategies, energy
demand based of the electricity prices from the first
stage and announces it electricity prices to the electricity
users. Finally, the electricity users act as the follower of
microgrid, adjust their consumption based on electricity
prices received from the microgrid.
2) We resolve the uncertainty of RES by adopting a condi-
tional restricted Boltzmann machine (CRBM) to handle
the huge amount and high dimensional nonlinear data
by extracting multiple levels of distinct data abstraction.
Jaya algorithm is applied for parameter fitting of the
CRBM and the prediction error minimization. For com-
parative analyzes, The proposed model is compare with
other models in literature [1].
The organization of this paper is as follows: In Section I, we
present the introduction of the domain as well as review of
the related works on game theoretic approaches to energy
management in microgrid. Section II presents the system
model of energy management and problem formulation as
well as the objective functions. The algorithm of the RES
power forecasting and the optimization algorithm are discussed
in Section III. Simulations and analyzes are presented in
Section IV. Finally, Section V provides the conclusion and
expected future work.
User 1 User 2 User N
Wind turbine
Geothermal Photovoltaic
Bought energy
from microgrid Sold energy to
Bought energy
from utility
Sold energy to
Pm,1 Pm,2 PM,m
E1,N E2,N EN,N
E2,M PM,g
Electric vehicle
Buffered sharing
Direct sharing Storage company
Fig. 1: Proposed system model.
A. System model
Fig. 1 shows the architecture of the proposed energy man-
agement with electricity user, microgrid, storage company and
the utility. In this system, we assume a single storage and
utility company; single microgrid with two generation sources,
i.e., wind and solar (photovoltaic) and Nnumber of electricity
users. To ensure stability of the system, microgrid requirement
are met by the utility and storage company. To get efficiency
of the proposed system model, microgrid is assigned to meet
the load demand of the electricity user. However, renewable
energy exhibits stochastic behavior for which microgrid may
not satisfy the load demand of electricity users at a certain
time and may need to procure more energy from the storage
B. Objective function
The storage and utility company are the leaders of the game,
broadcast their unit electricity prices to the microgrid. With a
fair electricity prices, the utility and storage company intend
to maximize their payoff. The optimization of the utility and
storage company are given as:
Maximiz e
PgUg(Em,g, Pg),(1)
Maximiz e
PsUs(Em,s, Ps).(2)
The utility objective function is expressed as quadratic func-
tion of electricity demand Emwhich is made of electricity
cost, Cutl(Em)and Epul (Em,g )is the pollutant emission
cost. Taking into account the line loss. We define the utility
objective function as:
Ug(Em,g, Pg) = Revg(Em,g, Pg)Cutl (gEm,g )
Epul(gEm,g ),(3)
Revg(Em,g , Pg) = Em,gPg,
Cutl(gEm,g ) = ag(gEm,g )2+bg(gEm,g )2+cg,
Epul(gEm,g ) = αg(gEm,g )2+βg(gEm,g ).
From Equation 3, first term represents the electricity rev-
enue and the second term and third term denote the power
generation cost function and pollutant emission, respectively.
Let Em,g is microgrid quantity of electricity purchased from
utility, Pgbe utility’s unit electricity prices. ag= 0.03, bg=
0.03, cg, αg= 0.08, βg= 0.08 be the cost parameters of
Cutl(gEm,g )and Epul (gEm,g),Ploss
gbe the transmission
power loss percentage (i.e., which is related to voltage ,
resistance and efficiencies of transformer). Generated electric-
ity gEm,g is used to satisfy microgrid demand, Em,g and
C. Objective function of the storage company
The storage company objective function after considering
the power loss during charging and discharging is define as:
Us(Em,s, Ps) = Revs(Em,s , Ps)Cs(sEm,s),(5)
Revs(Em,s, Ps) = Em,s Ps,
Cs(Es, Ps) = cssEm,s
From Equation 5, the first term represents the revenue of
the storage company and the second term represents storage
company cost function. Let Em,s is the microgrids’ quantity of
electricity purchased from the storage company, Psis the stor-
age company unit electricity prices, ηc= 0.5, ηd= 0.5are the
efficiencies of charging and discharging. cs= 1.5represents
the unit cost maintenance and operation and s=1
D. objective function of microgrid
Tn the three-stage Stackelberg game, microgrid performs
double roles such as follower of utility and storage, and leader
of users. The microgrid broadcast the electricity price to users,
and define the amount of power that is needed from the
utility and storage company. Microgrid maximizes its payoff
by adjusting its electricity prices and the quantity of electricity
demand. We assumed a single microgrid with two distributed
generators ( wind and solar) as source of power output, we also
consider the satisfaction function based on utility and storage
company quality of service of electricity. The optimization of
the microgrid is given as:
Maximiz e
Em,g,Em,s ,PmUm(Em,g , Pm),(7)
s.t. C1 : 0 gEm,g Eg ,max,
C2:0sEm,s Es,max,
C3 : 0 PmPm,max,
C4 : Em,s +Em,g =max
En,m ˆ
Lwind,solar ,0,
C5 :
En,m ˆ
Lwind,solar >0.
Where Eg,max = 200kW, Es,max = 100kW, Pm,max =
50cents/kW h are the maximum amount of electricity utility
sold to microgrid, storage company and the maximum electric-
ity prices user can afford. If PN
n=1 En,m ˆ
0, then the microgrid is satisfied with it generated electricity.
The objective function of microgrid is defined as:
Um(Em,g, Pm) = Revm,g(Em,g ) + Revm,s (Em,s)
Cm,g(Em,g , Pg)Cm,s (Em,s, Ps)
+Revm(Ek,m, Pm)Cm(ˆ
Lsolar,∆) Epul(ˆ
Lwind,∆) + F||,
Revm,g (Em,g) = Xm,g Em,g dm,g
Revm,s(Em,s ) = Xm,sEm,s dm,s
Cm,g(Em,g , Pg) = Em,g Pg,
Cm,s(Em,s , Ps) = Em,sPs,
Revm(En,m, Pm) =
Lwind + ∆) = am(ˆ
Lwind + ∆)2
Lwind + ∆) + cm,
Lsolar,∆) = csolar(ˆ
Lsolar + ∆)
Lwind + ∆) = αm(ˆ
Lwind + ∆)2
Lwind + ∆).
Let Revm,g (Em,g)be the satisfaction value and
Cm,g(Em,g , Pg)be utility company electricity sold to
microgrid , satisfaction parameter, Xm,g = 5 of utility
company is assume since it is hard to model satisfaction
parameter accurately. dm,g = 0.21 be the predefined
satisfaction parameter of microgrid, Revm,s(Em,s )
and Cm,s(Em,s , Ps)are same as Revm,g (Em,g)and
Cm,g(Em,g , Pg)previously defined. Let Revm(En,m , Pm)
be the revenue obtained from electricity users, En,m
is the nth users amount of electricity and Pmbe the
unit electricity price of microgrid, Cm(ˆ
Lwind,∆) and
Lwind,∆) is the pollutant emission and wind power
generation cost function, with the constant parameters
am= 0.05, bm= 0.05, cm= 0.05, αm= 0.05, βg= 0.05.
Lsolar,∆) is the cost function of the solar power
output, csolar be the operation and maintenance cost,
Lsolar + ∆) be the solar power output. Let ˆ
Lwind + ∆ and
Lsolar + ∆ denote the wind and solar power prediction and
Lwind,solar = 285kW be the actual capacity of the microgrid
power output, is the prediction error such that F < 0, i.e.,
when prediction result is inaccurate, microgrid’s payoff will
decrease. Let F=50 be the penalty factor.
E. Objective function of electricity users
The objective function of the nth electricity user is defined
with consideration of the satisfaction parameters. The electric-
ity user act as the follower of the microgrid and the amount
of power purchase by the electricity users depend on the Pm
to get maximize payoff. The nth electricity users is defined
Maximiz e
En,m Un(En,m, Pm)s.t. En,m En,b ,(11)
where En,b is the demand of nth electricity user and the
objective function is defined as:
Un(En,m, Pm) = Revn,m (En,m)Cn,m (En,m, Pm),(12)
Revn,m(En,m ) = Xn,mEn,m dn,b
Cn,m(En,m , Pm) = En,mPm.
Let Revn,m(En,m )and Cn,m(En,m , Pm)be the satisfaction
value and payment that nth electricity user made from elec-
tricity bought from microgrid. Let Xn,m and dn,b be the
satisfaction parameter and predefined satisfaction parameter
of the microgrid.
CRBM is the extension of the restricted Boltzmann ma-
chine, which is used to model time series and human ac-
tivities [28]. This paper addresses the parameter setting of
CRBM and train the network via an optimization algorithm.
Since wind and solar forecast are time series problem, we
adopt the CRBM to handle the huge amount nonlinear data,
which is capable of extracting multiple levels of distinct data
abstraction. The concept of CRBM works where the higher
levels are derived from the lower level ones. In this section,
we describe CRBM based on mathematical details such as
energy function, probability reference and learning rules.
ξ(v, h, u;W) = vTWvh vTauTWuv v
uTWuhhhTb, (14)
where ξ(v, h, u;W)is the energy function with respect to
u,v,h and W,v= [v1, . . . , vn]collects all the real values
for the visible unit, and vnis the last visible neurons index.
u= [u1, . . . , un]is the real values for the history unit, and
h= [hi, . . . , hn]is the hidden unit with binary vectors.
Wvh R,Wvu Rand Wuh Rdenote the weight
matrix connecting layers. b, a Rdenote the biases for hidden
and visible neuron, respectively. Where Wvh is bidirectional;
while, Wuh and Wuv are non-bidirectional.
The stochastic or probability inference of CRBM is obtained
by deriving two conditional distributions. The first conditional
distribution is used for getting the probability of hidden layer
that is conditioned on the rest layers; i.e., p(h|v, u), while
the second is used to get the probability of the visible layer
conditioned on the rest layers, i.e., p(v|h, u). The inference is
carried out in parallel for individual unit type since there is
no connection between the neuron of the same layer [28].
p(h|u, v) = sig(uTWuh +vTWv h +b),(15)
p(v|h, u) = N(WuvTu+Wvh h+a, σ2),(16)
where for brevity, we choose σ= 1. The hidden layer
is activated by a sigmoid function that denotes the value
of probability. The term Ndenotes the Gaussian activation
function over the total input of individual visible layer, whose
value is used as the probability of visible layer.
In the learning rules step, parameters are adjusted by a
maximal likelihood function in which the gradients of energy
function with respect to the weight are being computed. Due
to the problem of deriving the gradient of the likelihood
function, a contrastive divergence is implemented to minimize
the Kullback-Leibler measure between the input data and the
forecast data. Update of various weights and biases is obtained
by finding the derivative of energy function with respect to
individual variables. The update is in two phases: using the
Gibbs sampling for each training, the hidden unit is updated
by initializing the visible unit with the training data, while
visible unit is updated using the values of hidden unit. The
equations for weights and biases are given in [28] and the
parameters of CRBM used in this paper are learning rate
(τ)=0.001, hidden layer=10; output layer=1, momentum=0.9
and weight decay=0.002; .
In this paper, the mean absolute percentage error (MAPE)
for the validation sample which is termed as the prediction
error .
M AP E =1
where y
ndenotes the nth actual total microgrid power output
y, and ynrepresents the nth microgrid forecast power
output. The total time Ncan represent the hourly, daily,
weekly, seasonal or yearly time trends. Therefore, the final
Pwind (kWh)
Time (h)
20 7
25 1
Fig. 2: Wind power output [32].
minimal value of M AP E after a series of iterations is used
as the validation error ().
A. Forecast error minimization
The MAPE is further minimized using the Jaya optimization
algorithm and objective function, mathematically it is written
NM AP E, τ ;n[1,2, . . . , N ],(18)
Jaya algorithm was developed by Rao in 2016 to solve the
constrained and non-constrained optimization problem [29].
Jaya algorithm is used as a tool for providing optimal solutions
in different domains like the microgrid [30], smart grid [31],
etc. We denote the optimization function as f(x)which is
require for minimization at any iteration r. Let var be the
number of decision variables (1,2, . . . , var)and the whole
candidate’s solution is represented as NS. Let f(x)good be the
candidates with a good solution and f(x)bad be the candidates
with a bad solution. The modified value is obtained using
equation (19).
j,l,t =Modj,l,t
+r[0](Modj,good,t − |M odj,l,t |)
r[1](Modj,bad,t − |Modj,l,t|),
where Modj,good,t is the value of variable lfor the good
candidate and Modj,bad,t is the value of variable lfor the
bad candidate; r[0] and r[1] are the two random numbers
in range of [0,1]. The term r[0](Modj,good,t − |M odj,l,t |)
represents the tendency of the solution to move close to the
good solution; whereas, the term r[1](Modj,bad,t |Modj,l,t|)
represents the tendency of solution to avoid the bad solution.
All accepted function value at the each jis maintained, which
serves as input to subsequent iterations. The algorithm 1
illustrates optimization process of the proposed Jaya-CRBM
model. The parameters of Jaya based optimization algorithm
are population size (POP)= 30, number of decision variable=2,
maximum iteration (MaxGen)= 1000, minimum population=
0.1 and maximum population= 0.9.
Algorithm 1 Proposed Jaya-CRBM
1: procedure JAYA ALGORITHM()Get the minimized
forecast error
2: Intialized algorithm parameters
3: set gen = 0;
4: Train power output using CRBM,
5: Evaluate fitness of trained dataset,
6: while gen < maxGen do MaxGen is maximum
7: for gPOP do POP is the maximum
8: Calculate and store good and
9: bad individual solution,
10: Trim solution using Equation 19,
11: Evaluate fitness of trim
12: If previous fitness better
than later,
13: Replace population with the best,
14: Repeat until maximum iteration
15: gen=get+1;
16: return
Psolar (kWh)
Time (h)
20 7
25 1
Fig. 3: Solar power output [32].
This section discusses the proposed game theoretic energy
management with solar and wind power forecasting via sim-
ulation. To evaluate the forecasting model, hourly real data
of wind turbine and solar power which were collected from
National Renewable Energy Laboratory (NREL) and National
Wind Technology Center are shown in Fig. 2 and Fig. 3,
respectively. The power received from utility company is
assumed to be lower than that of the microgrid. Similarly,
utility company pollutant emission cost is assumed to be
higher than that of microgrid. In addition, we also assume
microgrid is preferred to use stored energy, i.e., the satisfaction
parameter of microgrid is higher than the storage company and
the basic load demand of each electricity users is also assumed
to be the same.
Fig. 4, demonstrates the optimal prices of storage, utility
10 20 30 40 50 60 70 80 90 100
Basic Electricity Demand of Users E
n,b * 1 hour (kWh)
Price (cents/kWh)
the utility company pg
the energy storage company ps
the microgrid pm
Fig. 4: Showing the optimal prices of utility company, storage
company and microgrid.
and microgrid in respect to user demand. The simulation
results report that there is monotonic increase of price for
storage, utility company and microgrid as the user demands
increases. It is also seen from simulation results that the
electricity prices of storage company is higher than the utility
company, it due to microgrid desires to get clean energy from
the storage company. More so, higher prices are reported for
microgrid than the utility and storage company, respectively.
This is because the microgrid desires to maximize its payoff
by announcing higher electricity prices to the electricity users
and the storage company.
10 20 30 40 50 60 70 80 90 100
Basic Electricity Demand of Users E
k,b * 1 hour (kWh)
Electricity procurement Quantity (kWh)
the utility company Em,g
the energy storage company Em,s
Fig. 5: Showing the electricity procurement cost from storage
and utility company.
Fig. 5 shows the procurement cost between the storage com-
pany and utility. From the simulation results, the amount of
microgrid power purchased from utility and storage company
remains stable as the users electricity demand increases. This
is due to microgrid desires to and pay get less power from
storage company and utility company as electricity demands
of users increases.
Fig. 6 presents the microgrid optimal payoff versus the
prediction error obtained from the power output forecasting by
Jaya-CRBM. If the forecast error is nonnegative, it means that
the predicted amount of power output is more than the actual
amount of power output; thus, microgrid may pay more to get
1 2 3 4 5 6 7 8 9 10
The Prediction Error
Payoff of the Microgrid
Fig. 6: Showing microgrids’ optimal payoff versus prediction
electricity from storage and utility. From the simulation results,
three different user load demand of 40, 60 and 80 kW have
been examined. The optimal payoff of microgrid decreases
monotonically due to the following reasons: the electricity
prices of microgrid are higher than both utility company and
storage company and microgrid is charged based on the power
output of the forecast wind and solar.
10 20 30 40 50 60 70 80 90 100
Basic Electricity Demand of Users E
k,b * 1 hour (kWh)
the utility company Ug
the energy storage company Us
the microgrid Um
Fig. 7: Showing the storage, utility company and microgrid
optimal payoffs.
Fig. 7 presents the optimal payoff of utility company, stor-
age company and microgrid versus the basic user electricity
demand. From the simulation results, the payoffs are shown
to monotonically increases as the electricity demand of users
increases. We also observed that the payoff of microgrid is
higher than both the payoffs of utility company and storage
company, respectively. Thus, microgrid may like to buy from
storage company than from the utility, however, the payoff of
the storage company is higher than the utility company.
Fig. 8 demonstrates the MAPE value of three algorithms,
i.e., the Jaya-CRBM, back propagation (BP) and genetic
stacked encoder and decoder (Genetic SAE) versus the fore-
casting step of the wind and solar energy. From the simulation
results, forecasting step increases along with MAPE values.
Thus, an inaccurate results will occur if the step continue to
1 1.5 2 2.5 3 3.5 4 4.5 5 5.5
MAPE (%)
Genetic SAE
Fig. 8: Showing MAPE values for the three models versus
forecasting step.
increases. In addition, our proposed algorithms show better
MAPE values as compared to the other two algorithms.
This paper presents three-stage Stackelberg game for the
energy management which consists of the interconnections
between utility company, storage company, microgrid and
the electricity users. In order to provide efficient model for
microgrid operation, we perform power output forecast of
wind and solar which assists the microgrid to apply the energy
management strategies. We assume a single utility company,
storage company as leaders, whereas, microgrid leader of user
and follower of storage and utility company, while the users
as follower of microgrid to formulate three-stage Stackelberg
game, where each player wishes to maximize its payoffs.
The closed form expression of the analysis via backward
induction for each stage and their respective optimal prices
are examined. Simulation is applied to validate the proposed
system that define the behavior of microgrid in respect to
the power output forecast error. In addition, a Jaya-CRBM
is applied to resolve the limitations of existing technique
in literature (Genetic SAE and BP), which demonstrates to
outperform the above mention techniques. In our future work,
energy management regarding coordination between multi-
microgrid operations that is based on economic dispatch for
fuel cost minimization. This is achieve through scheduling of
generators which limits certain load demand at some specific
interval. The power loss of microgrid due to distance between
the multi-microgrid is also considered.
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... In this chapter, the solutions to problems in Section 1.4 are discussed and published in [118]. ...
... Also, a multi-pseudonym mechanism is proposed to protect the transactional privacy of homes. Besides, blockchain resolves the problems of lack of trust and a single point of failure in a centralized system [118]. In Figure 11.1, blockchain handles security issue by generating a structure of data with inherent security features, such as integrity, confidentiality, availability, etc. ...
... To evaluate the performance of the proposed pricing policy, other existing pricing policies, such as ToU, CPP and RTP are used [118,374]. As shown in Figure 11.5(a), the proposed pricing policy has the minimum price for each hour as compared to its counterpart policies. ...
Full-text available
This thesis examines the privacy preserving energy management issue, taking into account both energy generation units and responsive demand in the smart grids. Firstly, because of the inherent stochastic behavior of the distributed energy resources, an optimal energy management problem is studied. Distributed energy resources are used in the decentralization of energy systems. Large penetration of distributed energy resources without the precise cybersecurity measures, such as privacy, monitoring and trustworthy communication may jeopardize the energy system and cause outages, and reliability problem for consumers. Therefore, a blockchain based decentralized energy system to accelerate electrification by improving service delivery while minimizing the cost of generation and addressing historical antipathy and cybersecurity risk is proposed. A case study of sub-Sahara Africa is considered. Also, a blockchain based energy trading system is proposed, which includes price negotiation and incentive mechanisms to address the imbalance of order. Besides, the Internet of energy makes it possible to integrate distributed energy resources and consumers. However, as the number of users involved in energy transactions increases, some factors are restricting conventional centralized energy trading. These factors include lack of trust, privacy, fixed energy pricing, and demurrage fees dispute. Therefore, additive homomorphic encryption and consortium blockchain are explored in this thesis to provide privacy and trust. Additionally, a dynamic energy pricing model is formulated based on the load demand response ratio of prosumers to address the fixed energy pricing problem. The proposed dynamic pricing model includes demurrage fees, which is a monetary penalty imposed on a prosumer if it failed to deliver energy within the agreed duration. Also, a new threat model is designed and analyzed. Secondly, mobile prosumers, such as electric vehicles offer a wide range of sophisticated services that contribute to the robustness and energy efficiency of the power grid. As the number of vehicles in the smart grid grows, it potentially exposes vehicle owners to a range of location related privacy threats. For example, when making payments, the location of vehicles is typically revealed during the charging process. Also, fixed pricing policy and lack of trust may restrict energy trading between vehicles and charging stations. Therefore, a private blockchain system is proposed to preserve the privacy of vehicle owners from linking based attack while a public blockchain system is established to enhance energy trading. Various parameters are used to formulate a demand based pricing policy for vehicles, such as time of demand, types of vehicles and locations. Using the demand based pricing policy, an optimal scheduling method is designed to maximize the vehicles both social welfare and utility. An improved consensus energy management algorithm is proposed to protect the privacy of vehicle owners by applying differential privacy. The proposed system is robust against temporal and spatial location based privacy related attacks. Thirdly, blockchain is an evolving decentralized data collection technology, which costeffectively exploits residential homes to collate large amounts of data. The problems of blockchain are the inability to withstand malicious nodes, which provide misleading information that destabilize the entire network, lack of privacy for individual node and shared data inaccuracy. Therefore, a secure system for energy users to share their multi-data using the consortium blockchain is proposed. In this system, a credibility based Byzantine fault tolerance algorithm is employed as the blockchain consensus mechanism to achieve the fault tolerance of the system. Also, a recurrent neural network is used by certain honest users with credibility to forecast the energy usage of other honest users. A recurrent neural network operates on the collated data without revealing the private information about honest users and its gradient parameters. Moreover, additive homomorphic encryption is used in the recurrent neural network to secure the collated data and the gradient parameters of the network. Also, a credibility management system is proposed to prevent malicious users from attacking the system and it consists of two layers: upper and lower. The upper layer manages global credibility that reflects the overall readiness of honest users to engage in multi-data sharing. The lower layer performs local credibility that reflects certain feedback of honest users on the accuracy of the forecast data. Lastly, combining blockchain mining and application intensive tasks increases the computational cost for resource constrained energy users. Besides, the anonymity and privacy problems of the users are not completely addressed in the existing literature. Therefore, this thesis proposes an improved sparse neural network to optimize computation offloading cost for resource constrained energy users. Furthermore, a blockchain system based on garlic routing, known as GarliChain, is proposed to solve the problems of anonymity and privacy for energy users during energy trading in the smart grid. Furthermore, a trust method is proposed to enhance the credibility of nodes in the GarliChain network. Simulations evaluate the theoretical results and prove the effectiveness of the proposed solutions. From the simulation results, the performance of the proposed model and the least-cost option varies with the relative energy generation cost of centralized, decentralized and blockchain based decentralized system infrastructure. Case studies of Burkina Faso, Cote d’Ivoire, Gambia, Liberia, Mali, and Senegal illustrate situations that are more suitable for blockchain based decentralized system. For other sub-Sahara Africa countries, the blockchain based decentralized system can cost-effectively service a large population and regions. Additionally, the proposed blockchain based levelized cost of energy reduces energy costs by approximately 95% for battery and 75% for the solar modules. The future blockchain based levelized cost of energy varies across sub-Sahara Africa on an average of about 0.049 USD/kWh as compared to 0.15 USD/kWh of an existing system in the literature. The proposed model achieves low transaction cost, the minimum execution time for block creation, the transactional data privacy of prosumers and dispute resolution of demurrage fees. Moreover, the proposed system reduces the average system overhead cost up to 66.67% as compared to 33.43% for an existing scheme. Additionally, the proposed blockchain proof of authority consensus average hash power is minimized up to 82.75% as compared to 60.34% for proof of stake and 56.89% for proof of work consensus mechanisms. Simulations are also performed to evaluate the efficacy of the proposed demand based pricing policy for mobile prosumers. From the simulation results, the proposed demand based pricing policy is efficient in terms of both low energy price and average cost, high utility and social welfare maximization as compared to existing schemes in the literature. It means that about 89.23% energy price reduction is achieved for the proposed demand based pricing policy as compared to 83.46% for multi-parameter pricing scheme, 73.86% for fixed pricing scheme and 53.07% for the time of use pricing scheme. The vehicles minimize their operating costs up to 81.46% for the proposed demand based pricing policy as compared to 80.48% for multi-parameter pricing scheme, 69.75% for fixed pricing scheme and 68.29% for the time of use pricing scheme. Also, the proposed system outperforms an existing work, known as blockchain based secure incentive scheme in terms of low energy prices and high utility. Furthermore, the proposed system achieves an average block transaction cost of 1.66 USD. Besides, after applying the differential privacy, the risk of privacy loss is minimum as compared to existing schemes. Furthermore, higher privacy protection of vehicles is attained with a lower information loss against multiple background knowledge of an attacker. To analyze the efficiency of the proposed system regarding multi-data sharing, an experimental assessment reveals that about 85% of honest users share their data with stringent privacy measures. The remaining 15% share their data without stringent privacy measures. Moreover, the proposed system operates at a low operating cost while the credibility management system is used to detect malicious users in the system. Security analysis shows that the proposed system is robust against 51% attack, transaction hacking attack, impersonation attack and the double spending attack. To evaluate the proposed system regarding energy management of resource constrained blockchain energy users, a Jaya optimization algorithm is used to accelerate the error convergence rate while reducing the number of connections between different layers of the neurons for the proposed improved sparse neural network. Furthermore, the security of the users is ensured using blockchain technology while security analysis shows that the system is robust against the Sybil attack. Moreover, the probability of a successful Sybil attack is zero as the number of attackers’ identities and computational capacities increases. Under different sizes of data to be uploaded, the proposed improved sparse neural network scheme has the least average computational cost and data transmission time as compared to deep reinforcement learning combined with genetic algorithm, and sparse evolutionary training and multi-layer perceptron schemes in the literature. Simulation results of the proposed GarliChain system show that the system remains stable as the number of path requests increases. Also, the proposed trust method is 50.56% efficient in detecting dishonest behavior of nodes in the network as compared to 49.20% of an existing fuzzy trust model. Under different sizes of the blocks, the computational cost of the forwarding nodes is minimum. Security analysis shows that the system is robust against both passive and active attacks. Malicious nodes are detected using the path selection model. Moreover, a comparative study of the proposed system with existing systems in the literature is provided.
... This study is the extension of our previous work [46], where our initial work focuses on the non-cooperative game, and in this paper, the contributions are listed below. ...
Full-text available
Multi-microgrid (MMG) system is a new method that concurrently incorporates different types of distributed energy resources, energy storage systems and demand responses to provide reliable and independent electricity for the community. However, MMG system faces the problems of management, real-time economic operations and controls. Therefore, this study proposes an energy management system (EMS) that turns an infinite number of MMGs into a coherence and efficient system, where each MMG can achieve its goals and perspectives. The proposed EMS employs a cooperative game to achieve efficient coordination and operations of the MMG system and also ensures a fair energy cost allocation among members in the coalition. This study considers the energy cost allocation problem when the number of members in the coalition grows exponentially. The energy cost allocation problem is solved using a column generation algorithm. The proposed model includes energy storage systems, demand loads, real-time electricity prices and renewable energy. The estimate of the daily operating cost of the MMG using a proposed deep convolutional neural network (CNN) is analyzed in this study. An optimal scheduling policy to optimize the total daily operating cost of MMG is also proposed. Besides, other existing optimal scheduling policies, such as approximate dynamic programming (ADP), model prediction control (MPC), and greedy policy are considered for the comparison. To evaluate the effectiveness of the proposed model, the real-time electricity prices of the electric reliability council of Texas are used. Simulation results show that each MMG can achieve energy cost savings through a coalition of MMG. Moreover, the proposed optimal policy method achieves MG's daily operating cost reduction up to 87.86% as compared to 79.52% for the MPC method, 73.94% for the greedy policy method and 79.42% for ADP method.
... A three-layer Stackelberg model including power grid, energy storage, and users is constructed in [11], and the Jaya-based Boltzmann machine algorithm was used to maximize the overall benefits of the game players. ...
Full-text available
This paper presents a model for optimal energy management under the time-of-use (ToU) and critical peak price (CPP) market in a microgrid. The microgrid consists of intermittent dispatchable distributed generators, energy storage systems, and multi-home load demands. The optimal energy management problem is a challenging task due to the inherent stochastic behavior of the renewable energy resources. In the past, medium-sized distributed energy resource generation was injected into the main grid with no feasible control mechanism to prevent the waste of power generated by a distributed energy resource which has no control mechanism, especially when the grid power limit is altered. Thus, a Jaya-based optimization method is proposed to shift dispatchable distributed generators within the ToU and CPP scheduling horizon. The proposed model coordinates the power supply of the microgrid components, and trades with the main grid to reduce its fuel costs, production costs, and also maximize the monetary profit from sales revenue. The proposed method is implemented on two microgrid operations: the standalone and grid-connected modes. The simulation results are compared with other optimization methods: enhanced differential evolution (EDE) and strawberry algorithm (SBA). Finally, simulation results show that the Jaya-based optimization method minimizes the fuel cost by up to 38.13%, production cost by up to 93.89%, and yields a monetary benefit of up to 72.78% from sales revenue.
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Economic-environmental power dispatch is one of the most popular bi-objective non-linear optimization problems in power system. Classical economic power dispatch problem is formulated with only thermal generators often ignoring security constraints of the network. But importance of reduction in emission is paramount from environmental sustainability perspective and hence penetration of more and more renewable sources into the electrical grid is encouraged. However, most common forms of renewable sources are intermittent and uncertain. This paper proposes multiobjective economic emission power dispatch problem formulation and solution incorporating stochastic wind, solar and small-hydro (run-of-river) power. Weibull, lognormal and Gumbel probability density functions are used to calculate available wind, solar and small-hydro power respectively. Some conventional generators of the standard IEEE 30-bus system are replaced with renewable power sources for study purpose. Network security constraints such as transmission line capacities and bus voltage limits are also taken into consideration alongwith constraints on generator capabilities and prohibited operating zones for the thermal units. Decomposition based multiobjective evolutionary algorithm and summation based multiobjective differential evolution algorithm are applied to the problem under study. An advanced constraint handling technique, superiority of feasible solutions, is integrated with both the multiobjective algorithms to comply with system constraints. The simulation results of both the algorithms are summarized, analyzed and compared in this study.
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Energy trading mechanism for microgrids has an inherent two-layer architecture, in which the energy trading at the first layer is between a microgrid aggregator and consumers (e.g., households) within a microgrid, and the second layer is referred to as the wide area energy trading among multiple microgrids. This paper employs a two-layer game approach to achieve optimal and elastic energy trading for microgrids and improve utilization of green energy. First, a non-cooperative game is developed inside a microgrid, in which the relationship among household users is non-cooperative, and they adjust load schedules to optimize their utilities while trading energy with the microgrid aggregator. Second, a multileader-multifollower Stackelberg game is employed for the energy trading among microgrids. The role of a microgrid (as an energy buyer or seller) in the energy market is based on the result of the first game, and it can elastically adjust its energy trading strategy by charging or discharging the energy storage device. The existence and uniqueness of the equilibriums for the two games are proven. We also present algorithms that can reach the equilibriums where players achieve optimal utilities. Simulation results show that the proposed two-layer energy trading is able to significantly improve the utilization of microgrids’ green energy.
Conference Paper
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In this paper, we presented JAYA algorithm which is a recently developed scheme that do not need any specific parameter to be adjusted except the known control parameters. To achieve the set of objectives like: electricity bill minimization, peak to average ratio (PAR) reduction, minimum user dissatisfaction , a proposed JAYA energy management controller (JAYA-EMC) for optimization is implemented. In increasing sustainability of smart grid, the simulation results of our proposed scheme is proven to be cost effective solution. In addition, the feasible region (FR) of appliances are calculated which show relationship between energy load, cost and delay.
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With the development of smart grids, a renewable energy generation system has been introduced into a smart house. The generation system usually supplies a storage system with the capability to store the produced energy for satisfying a user’s future demand. In this paper, the main objective is to determine the best strategies of energy consumption and optimal storage capacities for residential users, which are both closely related to the energy cost of the users. Energy management with storage capacity optimization is studied by considering the cost of renewable energy generation, depreciation cost of storage and bidirectional energy trading. To minimize the cost to residential users, the non-cooperative game-theoretic method is employed to formulate the model that combines energy consumption and storage capacity optimization. The distributed algorithm is presented to understand the Nash equilibrium which can guarantee Pareto optimality in terms of minimizing the energy cost. Simulation results show that the proposed game approach can significantly benefit residential users. Furthermore, it also contributes to reducing the peak-to-average ratio (PAR) of overall energy demand.
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According to the energy policy of encouraging local consumption of photovoltaic (PV) energy, the energy sharing among neighboring PV prosumers is proved to be a more effective way than the independent operation of each prosumer. In this paper, a Energy Storage (ES)-equipped Energy Sharing Provider (ESP) is proposed to facilitate the energy sharing of multiple PV prosumers. By using the ESP, the autonomous PV prosumers can be formed as an energy sharing network, and the energy sharing activities can be categorized as direct sharing and buffered sharing. First, with the assistance of the ES, a day-ahead scheduling model of ESP is built to increase the operation profit and improve the net power profile of the energy sharing network, which considers the uncertainty of PV energy, electricity prices and prosumers' load via stochastic programming. Moreover, to further increase the energy sharing, a real-time Demand Response (DR) model based on Stackelberg game is presented to coordinate the energy consumption behavior of prosumers by using internal prices. Finally, through a practical case study, the effectiveness of the method is verified in terms of improving the economic benefits and PV energy sharing.
The rapid development of microgrid (MG) has made it ready to connect multiple MGs for providing regional power supply. The energy management of a multi-microgrid (MMG) system is the key to the reliable, economic operation of the interconnected power system. The MMG system is rich in distributed generation sources. The intermittence and volatility of renewable energy sources (RESs) such as wind and solar cannot be ignored in a large-scale hybrid power system. Therefore, the energy management of a MMG system is a complex problem that coordinates distributed generation units within individual MGs, the power exchange among MGs, and the power trading between the grid and MGs. System of systems (SoS) has been identified as an effective way of forming a MMG system and coordinating the participating MGs for energy management. This paper proposes a hierarchical decentralized SoS architecture for the energy management of a MMG system and, accordingly, formulates it as a bi-level optimization problem. Energy management at the level of individual MGs is modeled as a multiple-stage robust optimization to handle the issue of RES uncertainty. Energy management at the level of MMG system further addresses the problem of spatially unbalanced demand and generation in the area. The proposed MMG energy management is further verified through a case study.
Electricity grid infrastructures provides valuable flexibility in power systems with high shares of variable supply due to its ability to distribute low-cost supply to load centers (spatial), in addition to interlinking a variety of supply and demand characteristics that potentially offset each others negative impact on system balance (temporal). In this paper, we present a framework to investigate the benefits of alternative flexibility providers, such as fast-ramping gas turbines, hydropower and demand side management, by using a generation and transmission capacity expansion planning model. We demonstrate our findings with a multinational case study of the North Sea Offshore Grid with an infrastructure typology from year 2016 and operational data for year 2030 – considering a range of renewable capacity levels spanning from 0% to 100%. First, we show how different flexibility providers are allocated geographically by the model. Second, operational cost savings are quantified per incremental unit of flexible capacity. Finally, we present a way to rank different flexibility providers by considering their marginal contribution to aggregate cost savings, reduced CO2 emissions, and increased utilization of renewable energy sources in the system. The Shapley Value from cooperative game theory allows us to assess the latter benefits accounting for all possible sequences of technology deployment, in contrast to traditional approaches. The presented framework could help to gain insights for energy policy designs or risk assessments.