Energy Storage Sharing in Smart Grid: A Modified Auction Based Approach (1512.07700v1)

Abstract: This paper studies the solution of joint energy storage (ES) ownership sharing between multiple shared facility controllers (SFCs) and those dwelling in a residential community. The main objective is to enable the residential units (RUs) to decide on the fraction of their ES capacity that they want to share with the SFCs of the community in order to assist them storing electricity, e.g., for fulfilling the demand of various shared facilities. To this end, a modified auction-based mechanism is designed that captures the interaction between the SFCs and the RUs so as to determine the auction price and the allocation of ES shared by the RUs that governs the proposed joint ES ownership. The fraction of the capacity of the storage that each RU decides to put into the market to share with the SFCs and the auction price are determined by a noncooperative Stackelberg game formulated between the RUs and the auctioneer. It is shown that the proposed auction possesses the incentive compatibility and the individual rationality properties, which are leveraged via the unique Stackelberg equilibrium (SE) solution of the game. Numerical experiments are provided to confirm the effectiveness of the proposed scheme.

• The paper presents a modified auction-based mechanism that facilitates efficient energy storage sharing between residential units and shared facilities in smart grids.
• It employs a noncooperative Stackelberg game to ensure incentive compatibility and individual rationality among participants.
• Numerical analysis reveals that the model increases utility and reduces costs, demonstrating practical benefits for smart grid management.

Energy Storage Sharing in Smart Grids: A Modified Auction-Based Approach

The paper "Energy Storage Sharing in Smart Grid: A Modified Auction Based Approach" presents a comprehensive framework for energy storage sharing between residential units and shared facility controllers in smart grid environments. The objective is to enable residential units equipped with energy storage systems to share their available storage capacity with shared facilities, optimizing storage usage and reducing costs.

Key Contributions

1. Auction-Based Mechanism: The paper introduces a modified auction-based mechanism to facilitate the sharing of energy storage. This mechanism captures the interactions between shared facility controllers and residential units, determining both the auction price and the shareable storage allocation.
2. Noncooperative Stackelberg Game: The problem is formulated as a noncooperative Stackelberg game where the auctioneer acts as the leader, setting the auction price, while the residential units are the followers, deciding on the amount of storage they are willing to share. The game aims to achieve a unique Stackelberg equilibrium (SE) that maximizes the utility for all participants.
3. Incentive Compatibility and Individual Rationality: The auction designed within this framework is shown to possess both incentive compatibility and individual rationality. This ensures that participants are motivated to reveal their true preferences and take part in the storage sharing process without deceit.
4. Numerical Analysis: Through numerical experiments, the paper showcases the effectiveness of the proposed approach, highlighting its potential benefits in terms of cost savings and improved resource distribution among participants.

Numerical Results and Implications

The numerical simulations highlight several critical findings:

• Improved Utility: Residential units can significantly increase their utility by sharing storage with shared facilities, especially when the storage requirement of facilities increases.
• Cost Effectiveness: The auction mechanism ensures that the shared facility controllers achieve substantial cost savings, making it economically viable for them to purchase stored energy from residential units.
• Reluctance Parameter: The reluctance parameter plays a pivotal role in determining the level of storage each residential unit is willing to share. Higher reluctance results in less storage being shared, reducing potential benefits.

Implications and Future Directions

The implications of this research extend both practically and theoretically. Practically, the proposed model can significantly reduce the space and costs associated with installing large-scale energy storage systems by leveraging distributed storage resources. Theoretically, it provides a benchmark for designing incentive-compatible mechanisms in distributed energy systems.

Potential Future Developments

• Time-Varying Extensions: Future work could explore the extension of this model to time-varying environments, taking into account the dynamic nature of renewable generation and fluctuating demand patterns.
• Integration with Renewable Sources: Further work could investigate the integration of this storage sharing model with renewable energy sources, optimizing both storage and generation decisions.
• Scalability: While the current model is ideal for a limited number of participants, future research could enhance its scalability to accommodate larger networks with numerous entities. This might involve exploring collaborative game-theoretic approaches or hybrid auction models.

In conclusion, this paper provides a robust framework for energy storage sharing in smart grids, potentially transforming how energy is managed and distributed among residential and shared facilities. Through its insightful combination of auction theory and game theory, it sets the stage for further exploration and practical implementation in future smart grid developments.