Non-Cooperative Games for Privacy-Preserving and Cost-Efficient Smart Grid Energy Management

In this paper, we design privacy-preserving and cost-efficient energy management strategies for smart grid users that are equipped with renewable energy sources. The adversary is assumed to employ a factorial hidden Markov model based inference for load disaggregation, and the corresponding joint log-likelihood of the model is utilized as the privacy measure. The studied dynamic pricing model is applicable to a commodity-limited market, where the price of unit amount of energy is determined by the users’ aggregated power request. The users’ energy management strategies are designed under a non-cooperative game framework, where each user aims to optimize a weighted sum objective of both privacy measure and energy cost saving. The users’ non-cooperative game is shown to admit a unique pure strategy Nash equilibrium. As an extension, a computational-efficient distributed Nash equilibrium energy management strategy seeking method is proposed, which also avoids the privacy leakage due to the sharing of payoff functions between users. The performance of practical designs of the energy management strategies in the equilibrium is finally illustrated by numerical experiments.