Expected Utility and Entropy-Based Decision-Making Model for Large Consumers in the Smart Grid
In the smart grid, large consumers can procure electricity energy from various power sources to meet their load demands. To maximize its profit, each large consumer needs to decide their energy procurement strategy under risks such as price fluctuations from the spot market and power quality issues....
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doaj-b373e106184a42709e86d0526361f0312020-11-24T22:43:45ZengMDPI AGEntropy1099-43002015-09-0117106560657510.3390/e17106560e17106560Expected Utility and Entropy-Based Decision-Making Model for Large Consumers in the Smart GridBingtuan Gao0Cheng Wu1Yingjun Wu2Yi Tang3School of Electrical Engineering, Southeast University, Nanjing 210096, ChinaSchool of Electrical Engineering, Southeast University, Nanjing 210096, ChinaSchool of Automation, Nanjing University of Posts and Telecommunications, No. 9, Wenyuan Road, Nanjing 210023, ChinaSchool of Electrical Engineering, Southeast University, Nanjing 210096, ChinaIn the smart grid, large consumers can procure electricity energy from various power sources to meet their load demands. To maximize its profit, each large consumer needs to decide their energy procurement strategy under risks such as price fluctuations from the spot market and power quality issues. In this paper, an electric energy procurement decision-making model is studied for large consumers who can obtain their electric energy from the spot market, generation companies under bilateral contracts, the options market and self-production facilities in the smart grid. Considering the effect of unqualified electric energy, the profit model of large consumers is formulated. In order to measure the risks from the price fluctuations and power quality, the expected utility and entropy is employed. Consequently, the expected utility and entropy decision-making model is presented, which helps large consumers to minimize their expected profit of electricity procurement while properly limiting the volatility of this cost. Finally, a case study verifies the feasibility and effectiveness of the proposed model.http://www.mdpi.com/1099-4300/17/10/6560decision-making modelexpected utility and entropypower qualityrisk measurementsmart grid |
collection |
DOAJ |
language |
English |
format |
Article |
sources |
DOAJ |
author |
Bingtuan Gao Cheng Wu Yingjun Wu Yi Tang |
spellingShingle |
Bingtuan Gao Cheng Wu Yingjun Wu Yi Tang Expected Utility and Entropy-Based Decision-Making Model for Large Consumers in the Smart Grid Entropy decision-making model expected utility and entropy power quality risk measurement smart grid |
author_facet |
Bingtuan Gao Cheng Wu Yingjun Wu Yi Tang |
author_sort |
Bingtuan Gao |
title |
Expected Utility and Entropy-Based Decision-Making Model for Large Consumers in the Smart Grid |
title_short |
Expected Utility and Entropy-Based Decision-Making Model for Large Consumers in the Smart Grid |
title_full |
Expected Utility and Entropy-Based Decision-Making Model for Large Consumers in the Smart Grid |
title_fullStr |
Expected Utility and Entropy-Based Decision-Making Model for Large Consumers in the Smart Grid |
title_full_unstemmed |
Expected Utility and Entropy-Based Decision-Making Model for Large Consumers in the Smart Grid |
title_sort |
expected utility and entropy-based decision-making model for large consumers in the smart grid |
publisher |
MDPI AG |
series |
Entropy |
issn |
1099-4300 |
publishDate |
2015-09-01 |
description |
In the smart grid, large consumers can procure electricity energy from various power sources to meet their load demands. To maximize its profit, each large consumer needs to decide their energy procurement strategy under risks such as price fluctuations from the spot market and power quality issues. In this paper, an electric energy procurement decision-making model is studied for large consumers who can obtain their electric energy from the spot market, generation companies under bilateral contracts, the options market and self-production facilities in the smart grid. Considering the effect of unqualified electric energy, the profit model of large consumers is formulated. In order to measure the risks from the price fluctuations and power quality, the expected utility and entropy is employed. Consequently, the expected utility and entropy decision-making model is presented, which helps large consumers to minimize their expected profit of electricity procurement while properly limiting the volatility of this cost. Finally, a case study verifies the feasibility and effectiveness of the proposed model. |
topic |
decision-making model expected utility and entropy power quality risk measurement smart grid |
url |
http://www.mdpi.com/1099-4300/17/10/6560 |
work_keys_str_mv |
AT bingtuangao expectedutilityandentropybaseddecisionmakingmodelforlargeconsumersinthesmartgrid AT chengwu expectedutilityandentropybaseddecisionmakingmodelforlargeconsumersinthesmartgrid AT yingjunwu expectedutilityandentropybaseddecisionmakingmodelforlargeconsumersinthesmartgrid AT yitang expectedutilityandentropybaseddecisionmakingmodelforlargeconsumersinthesmartgrid |
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1725694785074757632 |