Incentive

Engineering

Microeconomics

Economics

Computer science

Mathematical optimization

Prosumer

Load management

Demand response

Renewable energy

Mathematics

Bidding

Econometrics

Nash equilibrium

Mathematical economics

Game theory

Electricity

Electrical engineering

IEEE Transactions on Smart Grid

This paper proposes a novel energy sharing mechanism for prosumers who can produce and consume. Different from most existing works, the role of individual prosumer as a seller or buyer in our model is endogenously determined. Several desirable properties of the proposed mechanism are proved based on a generalized game-theoretic model. We show that the Nash equilibrium exists and is the unique solution of an equivalent convex optimization problem. The sharing price at the Nash equilibrium equals to the average marginal disutility of all prosumers. We also prove that every prosumer has the incentive to participate in the sharing market, and prosumers' total cost decreases with increasing absolute value of price sensitivity. Furthermore, the Nash equilibrium approaches the social optimal as the number of prosumers grows, and competition can improve social welfare.

An Energy Sharing Game With Generalized Demand Bidding: Model and Properties