Efficiency and Stability in Electrical Power Transmission Networks: a Partition Function Form Approach
The users of electricity networks are organized into groups where the production and consumption of electricity is in balance. We study the formation of these balancing groups using a cooperative game in partition function form defined over an ideal (lossless) DC load flow model of the power grid. We show that such games contain widespread externalities that can be both negative and positive. We study the stability of certain partitions using the concept of the recursive core. While the game is clearly cohesive, we demonstrate that it is not necessarily superadditive. We argue that subadditivity may be a barrier to achieve full cooperation.
KeywordsPartition function form games Power transmission networks Externalities Game theory Recursive core
The authors thank Katalin Hangos, Dávid Raisz, Dániel Divényi, and seminar participants at IEHAS and LSU for their input. This work has been supported by the Fund PD 123900 of the Hungarian National Research, Development and Innovation Office, by the Momentum Program by the Hungarian Academy of Sciences (LP-004/2010), and by the Fund KAP17-61008-1.2-ITK of the Pázmány Péter Catholic University.
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