Bi-level Demand Response Game with Information Sharing among Consumers

In this paper, we formulate the demand response problem in smart grid as a bi-level game: a consumer-level noncooperative game and a one-leader-one-follower Stackelberg game between the provider-level and the consumer-level. We prove the existence of a Nash Equilibrium for the noncooperative game and a Stackelberg Equilibrium for the Stackelberg game, focus on the case with information sharing among all consumers, and design distributed algorithms for the supply side and demand side as well as the information platform. Numerical results are provided to illustrate the performance of the proposed algorithms and the effectiveness of information sharing for improving each consumer's payoff.