Distributed real-time pricing of smart grid considering individual differences

Abstract

The utility function that characterizes customers’ satisfaction with electricity consumption plays an important and irreplaceable role in the real-time pricing mechanism based on the social welfare maximization model. Without the accurate quantification of customers’ utility, the real-time pricing will deviate from the reality. In fact, the utility functions of different types of customers in different regions should be obtained by fitting a large amount of historical data over a long period of time based on insight into the relationship between factors and utility. Based on the consideration of customers’ individual differences, a new utility function is proposed, which enriches the form of the utility function and provides a reference for fitting a real and accurate utility function. Further, based on this proposed utility function, a real-time pricing model of social welfare maximization is developed to obtain the fair electricity price between customers and the power supplier. On the basis of the separable structure of variables, we design distributed algorithms with global convergence for the pricing model and estimate a worst-case convergence rate. Numerical simulations verify the feasibility and effectiveness of our algorithms and the rationality of the new utility function, i.e., the electricity price based on the proposed utility function is more robust than the existing ones.