Dynamic Evolution Game Strategy of Government, Power Grid, and Users in Electricity Market Demand-Side Management

Abstract

In the process of promoting demand-side management, the core stakeholder groups are government departments, power grid companies, and electricity users. Due to the different positions and conflicting interests of the three parties in the game, intense and complex battles will occur. This paper investigates a tripartite evolutionary game involving government, power grid companies, and electricity users in the context of demand-side management (DSM) and analyzes the dynamic interactions between government departments, power grid companies, and electricity users within the framework of DSM using evolutionary game theory. Using evolutionary game theory, we explore how incentives and strategic interactions among these three stakeholders evolve over time, affecting the stability of DSM policies. The model addresses the asymmetry in the decision-making process and examines the dynamic equilibrium outcomes under various scenarios. The results provide insights into the optimal design of incentive mechanisms to enhance DSM adoption. The findings offer practical recommendations to improve DSM policies, fostering balanced interests between government, grid companies, and users. This research contributes to a deeper understanding of strategic interactions in DSM, revealing how adaptive behaviors can enhance energy efficiency. It also underscores the importance of carefully designed incentive mechanisms in achieving long-term stability and cooperation among key stakeholders.

Keywords

• power demand-side management
• incentive mechanism
• evolutionary game theory
• evolutionary stable equilibrium
• replicator dynamics equations