Encrypted Price-based Market Mechanism for Optimal Load Frequency Control⋆

Abstract

The global trend of energy deregulation has led to the market mechanism replacing some functionality of load frequency control (LFC). Accordingly, information exchange among participating generators and the market operator plays a crucial role in optimizing social utility. However, privacy has been an equally pressing concern in such settings. This conflict between individuals’ privacy and social utility has been a long-standing challenge in market mechanism literature as well as in Cyber-Physical Systems (CPSs). In this paper, we propose a novel encrypted market architecture that leverages a hybrid encryption method and two-party computation protocols, enabling the secure synthesis and implementation of an optimal price-based market mechanism. This work spotlights the importance of secure and efficient outsourcing of controller synthesis, which is a critical element within the proposed framework. A two-area LFC model is used to conduct a case study.