Leader-follower trading mechanism of industrial park demand response

Limited control and communication infrastructure at the distribution level has not allow small users to directly interact the whole energy market. To satisfy growing energy demand, how improve demand response management with the involvement of different types of users is still challenging. Because different stakeholders, such as end-users and aggregated agents, have various energy supply requirements and operation rules. Sending all the information to the central operators introduces privacy and security problems. To address these problems, this paper proposed a leader-follower trading mechanism based on Stackelberg gaming model to coordinate trading between multiple stakeholders (e.g. end-users) with various preferences and sequences. Bidding strategies and gaming rules are fully analysed for industrial park operator and user aggregators. Considering user behaviours, a two-stage optimization algorithm is utilized to solve this model. From case studies, it can be verified that the proposed mechanism can not only ensure higher energy benefits for all the participants but also enhance more active ability of end-users and aggregated agents. Therefore, this proposed leader-follower trading mechanism can make energy market interactions more flexible and active.