Assessing the Feasibility of Game-Theory-Based Demand Response Management by Practical Implementation

Demand response (DR) has been widely recognized as an effective solution to help mitigate the stresses imposed on power grids. As new concepts evolve, DR induces various interactions among multiple emerging entities, which further complicates the decision-making processes in grid operations. Recently, game theory (GT) has received great attention in DR management, due to its ability to handle complex decision-making problems. Numerous theoretical GT-based approaches have been proposed for addressing various DR issues, but the feasibility of these theoretical approaches in practical implementation remains in doubt. To bridge the gap between theoretical studies and practical implementations, we first provide specific guidelines regarding how to construct a DR-oriented facility, and then investigate the effectiveness of deploying a Stackelberg game theory-based DR algorithm to manage the energy consumption of the facility, wherein the energy management center (EMC) serves as the leader and multiple devices act as the followers. The experimental evaluation results show that the GT-based DR algorithm achieved great performance in practical DR management, including optimal load control in responding to real-time price (RTP), and peak load reduction with a peak-to-average ratio (PAR) of 1.59.