A Mechanism Design Approach for Coordination of Thermostatically Controlled Loads

TL;DR

This paper introduces a mechanism design framework for coordinating thermostatically controlled loads, enabling efficient energy management and peak reduction through strategic bidding and learning in uncertain environments.

Contribution

It proposes a novel market mechanism incorporating TCL dynamics and a learning scheme for unknown parameters, achieving optimal coordination in a strategic setting.

Findings

The mechanism achieves the team optimal solution in simulations.

The learning scheme effectively estimates unknown load parameters.

Numerical results validate the coordination framework's effectiveness.

Abstract

This paper focuses on the coordination of a population of thermostatically controlled loads (TCLs) with unknown parameters to achieve group objectives. The problem involves designing the device bidding and market clearing strategies to motivate self-interested users to realize efficient energy allocation subject to a peak energy constraint. This coordination problem is formulated as a mechanism design problem, and we propose a mechanism to implement the social choice function in dominant strategy equilibrium. The proposed mechanism consists of a novel bidding and clearing strategy that incorporates the internal dynamics of TCLs in the market mechanism design, and we show it can realize the team optimal solution. A learning scheme is proposed to address the unknown load model parameters. Numerical simulations are performed to validate the effectiveness of the proposed coordination framework.