This paper studies cooperative relay-based neighborhood area networks in smart grid, where the building gateway with better channel condition will forward the energy consumption information originated from the congested building gateways to the data aggregator unit, in order to improve the accuracy of energy consumption information gathered at the data aggregator. This can make the consumers reserve accurate energy from the public utility with a low price, and further reduce the electricity cost. Relay power allocation is important to the efficiency of the cooperative relaying in cost reduction. The paper is motivated by these two interesting questions: How the relay building gateway allocates transmission power between relaying and its own transmission and what is the optimal relay power allocation strategy among the other buildings gateways? In order to answer the questions, we formulate the power allocation problem as a Stackelberg game and prove that it has a unique equilibrium point, which is the optimal power allocation solution for the building gateways. Numerical results show that relaying can dramatically reduce the cost of consumers in a building.
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