Mechanism Design for Demand Management in Energy CommunitiesWe consider a demand management problem of an energy community, in which
several users obtain energy from an external organization such as an energy
company, and pay for the energy according to pre-specified prices that consist
of a time-dependent price per unit of energy, as well as a separate price for
peak demand. Since users' utilities are private information which they may not
be willing to share, a mediator, known as the planner, is introduced to help
optimize the overall satisfaction of the community (total utility minus total
payments) by mechanism design. A mechanism consists of message spaces, and a
set of tax and allocation functions for each user. Once we implement the
mechanism, each user reports a message chosen from her own message space, and
then receives some amount of energy determined by the allocation function and
pays the tax specified by the tax function. A desirable mechanism induces a
game in which Nash equilibria (NE) provides an allocation that coincides with
the optimal allocation for the community.
As a starting point, we design a standard, "centralized" mechanism for the
energy community with desirable properties such as full implementation, strong
budget balance and individual rationality for both users and the planner. Then
we extend this mechanism to the case of communities where message exchanges
only happen among neighborhoods, and consequently, the tax and allocation
functions of each user are only determined by the messages from her neighbors.
All the properties designed for the centralized mechanism are preserved in the
distributed mechanism. Subsequently, we address the problem of learning
guarantees for both mechanisms. One set of learning dynamic was found in this
primary work, that guarantees users will reach NE if they follow these
dynamics.
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