| Summary: | This study proposes a new model of demand response management for a future smart grid that consists of smart microgrids. The microgrids have energy storage units, responsive loads, controllable distributed generation units, and renewable energy resources. They can buy energy from the utility company when the power generation in themselves cannot satisfy the load demand, and sell extra power generation to the utility company. The goal is to optimize the operation schedule of microgrids to minimize the microgrids’ payments and the utility company’s operation cost. A parallel distributed optimization algorithm based on games theory is developed to solve the optimization problem, in which microgrids only need to send their aggregated purchasing/selling energy to the utility company, thus avoid infringing its privacy. Microgrids can update their operation schedule simultaneously. A case study is implemented, and the simulation results show that the proposed method is effective and efficient.
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