Application of Mechanism Design to Interruptible Load Management in Electricity Markets

摘要

There are two keys of contracts for interruptible load management in order to utilize the electric power resource effectively, i.e., how to curtail load and compensate customers. However, the presence of informational asymmetries between utilities and customers in electricity markets may cause immeasurable inefficiencies in interruptible load management programs. Suppose that utility can estimate customer outage cost information to a certain extent, this paper presents a contract model for interruptible load management using mechanism design, which can lead customers to voluntarily reveal their true outage cost information and the electricity resource will be utilized effectively. The proposed model can take account of maximum interruptible load constraints and be applied to different optimization objectives for dispatching the interruptible customers, such as maximizing the utility's benefit or minimizing the total outage cost of customers. A numerical example using Monte Carlo simulation method is presented to demonstrate the validity of the proposed model.