Curtailment Contract Design for HVAC Systems and Benefits for Management of Uncertain Generation

This contribution proposes a curtailment contract design for HVAC systems and analyzes how such contracts can improve the performance of an aggregator with uncertain generation. We build upon a design brought forward by Cam-paigne and Oren (2016) and modify the approach for consumers with HVAC systems. Specifically, we include assumptions about the concavity of utility and time-interdependencies in multiperiod contracts and propose an online cut-off rule for the aggregator. We use mechanism design to formulate an incentive-compatible contract set for customers with different valuations for temperature deviations. Consumer welfare and aggregator profits are analyzed under different parametrizations.