Common Agency-Based Economic Model for Energy Contract in Electric Vehicle Networks

The rapid adoption of electric or hybrid vehicles (EVs) has called for wide deployment of charging stations. These stations can be launched/owned by different owners, referred to as charging station providers (CSPs), which make energy contracts with a smart grid provider (SGP). However, there exists a shortage of mutual economic strategy between the SGP and CSPs in an energy request/transfer competition due to the selfish nature among them. In this paper, we propose an economic model leveraging a multi-principal single-agent (referred to as common agency) contract policy, aiming at maximizing the utilities of multiple CSPs while optimizing the utility of the SGP in an EV network. In particular, we first develop the common agency-based contract problem as a non-cooperative energy contract optimization problem, in which each CSP can maximize its utility given the common constraints from the SGP and the contracts of other CSPs. To deal with this problem, we develop an iterative energy contract algorithm to find an equilibrium contract solution where the contracts from the CSPs can produce maximum utilities of the CSPs and satisfy the constraints of the SGP. Through numerical results, we show that our proposed model can improve the social welfare of the EV network up to 54% and the utilities of CSPs up to 60% compared with the baseline method in which each CSP obtains the amount of energy that is proportional to its energy request.