Robust bidding strategy for demand response aggregators in electricity market based on game theory

One of the ways to manage and provide flexibility in power systems is demand response (DR). A large number of end-users as DR sources must be aggregated by an intermediate entity called DR aggregator. This paper proposes an approach based on game theory to obtain the best bidding strategy of DR aggregators in electricity market. In the presented scheme, an economic responsive load model is employed for DR approach which is based on customer benefit function and price elasticity. In this paper, the network operator receives DR services from the DR aggregator. It is considered that all bids from aggregators are assembled by a network operator which calculates the share of each aggregator in DR programs by revenue function optimization. Furthermore, the network operator offers rewards to DR aggregators to achieve this purpose. The robust optimization (RO) method is used handling price uncertainty. It is used to optimize the robustness of the decision-making strategies. A non-cooperative game is used to model the competition among DR aggregators. The Nash equilibrium idea is employed to solve this game. (C) 2019 Elsevier Ltd. All rights reserved.