Game Theory Application and Strategic Bidding in Electricity Supply Market - World Journal of Engineering and Technology

WJET > Vol.4 No.3, October 2016

Game Theory Application and Strategic Bidding in Electricity Supply Market ()

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Download as PDF (Size: 401KB) PP. 72-81

DOI: 10.4236/wjet.2016.43D010 2,065 Downloads 4,899 Views Citations

Author(s)

Zhao Wang, Kwok Lun Lo

Affiliation(s)

Electronic and Electrical Engineering Department, University of Strathclyde, Glasgow, UK.

ABSTRACT

This paper introduced the application of game theory in electricity power market. Moreover, the electricity pool model and the merit order dispatch method was introduced. In pool mode, participants are trying to maximize their benefit via competition with each other. Hence the market can be regarded as a non-cooperative game, especially, the electrical supply competition. Players (generators) could use strategic bidding to occupy advantages in competition. The bidding strategies of generators in electricity pool model were researched via build a 3-generator competition model. Moreover, Nash Equilibrium idea was used to explore generator’s optimal bidding strategy. The results show when players are in Nash Equilibrium; thestrategy is their optimal bidding strategy.

KEYWORDS

Non-Cooperative Game Theory, Nash Equilibrium, Electricity Pool Model

Share and Cite:

Wang, Z. and Lo, K. (2016) Game Theory Application and Strategic Bidding in Electricity Supply Market. World Journal of Engineering and Technology, 4, 72-81. doi: 10.4236/wjet.2016.43D010.

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