Game Theory Application in Smart Energy Logistics and Economy

Baseem Khan

A chapter in Game Theory - Applications in Logistics and Economy from IntechOpen

Abstract: In many parts of the world, energy sectors are transformed from conventional to the smart deregulated market structures. In such smart deregulated market environment, cooperative game theory can play a vital role for analyzing various smart deregulated market problems. As an optimization tool, cooperative game theory is very useful in smart energy logistics and economy analysis problem. The economy associated with smart deregulated structure can be better optimized and allocated with the help of cooperative game theory. Initially, due to regulated structure, there is no cooperation between different entities of energy sector. But after new market structure, all the entities are free to take their own decisions as an independent entity. Transmission open access of energy logistics is also comes into the picture, as all the generators and demands have the same right to access the transmission system. In this market situation, multiple utilities are using the same energy logistic network. This situation can be formulated as a cooperative game in which generators and demands are represented by players. This chapter deals with energy logistic cost allocation problems for a smart deregulated energy market. It is cooperative in nature as all the agents are using the same energy logistic network.

Keywords: smart grid; cooperative game theory; Shapley value; Nucleolus approach; transmission usage cost allocation; transmission loss allocation (search for similar items in EconPapers)
JEL-codes: C7 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:ito:pchaps:147443

DOI: 10.5772/intechopen.76145

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