Demand Side Energy Management via Multiagent Coordination in Consumer Cooperatives

Abstract

A key challenge in creating a sustainable and energy-efficient society is to make consumer demand adaptive to the supply of energy, especially to the renewable supply. In this article, we propose a partially-centralized organization of consumers (or agents), namely, a consumer cooperative that purchases electricity from the market. In the cooperative, a central coordinator buys the electricity for the whole group. The technical challenge is that consumers make their own demand decisions, based on their private demand constraints and preferences, which they do not share with the coordinator or other agents. We propose a novel multiagent coordination algorithm, to shape the energy demand of the cooperative. To coordinate individual consumers under incomplete information, the coordinator determines virtual price signals that it sends to the consumers to induce them to shift their demands when required. We prove that this algorithm converges to the central optimal solution and minimizes the electric energy cost of the cooperative. Additionally, we present results on the time complexity of the iterative algorithm and its implications for agents' incentive compatibility. Furthermore, we perform simulations based on real world consumption data to (a) characterize the convergence properties of our algorithm and (b) understand the effect of differing demand characteristics of participants as well as of different price functions on the cost reduction. The results show that the convergence time scales linearly with the agent population size and length of the optimization horizon. Finally, we observe that as participants' flexibility of shifting their demands increases, cost reduction increases and that the cost reduction is not sensitive to variation in consumption patterns of the consumers.