A game theoretical approach to modeling energy consumption with consumer preference

We propose a new game theoretical equilibrium model to analyze residential users' electricity consumption behavior in smart grid where energy usage and price data are exchanged between users and utilities via advanced communication. Consideration is given to users' possible preference on convenience over cost-saving under the real-time pricing in smart grid, and each user is assumed to have a preferred time window for using a particular appliance. As a result, each user (player) in the proposed energy consumption game wishes to maximize a payoff or utility consisting of two parts: the negative of electricity cost and the convenience of using appliances during their preferred time windows. Extensive numerical tests suggest that users with less flexibility on their preferred usage times have larger impact on the system performance at equilibrium. This provide insights for utilities to design their pricing based demand response schemes.