Coordinating scheduling of production and utility system using a Stackelberg game

Abstract

Operation of the production system and of the utility system is commonly optimized separately without feedback between them. This separated planning in general increases total costs. Conceptually, a joint optimization of production and utility system is desirable, but often not possible in practice. We overcome such practical limitations by proposing a repeated Stackelberg game. In the proposed method, the production schedule is determined such that costs for both production and utility system are reduced. For this purpose, price information are passed from the utility system to the production system leading to fast convergence of the repeated Stackelberg game. The proposed repeated Stackelberg game is applied to two literature-based case studies. The proposed method reduces the total costs in one repetition by 9% and 5%. The suggested method provides an effective and practical approach to operate systems with reduced minimal total costs in practice.