Informs Annual Meeting Phoenix 2018

INFORMS Phoenix – 2018

TD49

3 - On The Fairness and Stability of Aggregator-guided Demand Response Programs Kevin Melendez, University of South Florida, Tampa, FL, 33613, United States, Tapas K. Das The cooperation among demand side players in the electricity market is a recent subject of interest. In this paper, cooperation among the load consuming entities(LCEs) managed by a demand response aggregator (DRA) is studied.a decision making model for the DRA is proposed with three alternative objectives: (1) overall community cost minimization solution, (2) the Nash bargaining solution and (3) the solution with minimum distance from the ideal point.The modeling approaches were tested using ERCOT (recent) historical data and the three objectives were compared and contrasted under different problem scenarios. 4 - A Two-layer Robust Optimization Model for Dynamic Pricing of Electricity and Demand Response by Electric Vehicle Aggregators Vignesh Subramanian, University of South Florida, Tampa, FL, 33617, United States,, Tapas K. Das This paper develops a robust two-layer bilevel optimization model for obtaining hourly nodal dynamic prices (DP) and corresponding demand response (DR) by electric vehicle (EV) aggregators. The top layer determines the day-ahead quantities and prices. The bottom layer models the real-time (RT) operations and formulates it as a bilevel program; at the upper-level system operator determines dynamic prices and in the lower level aggregators optimize EV consumption. Results demonstrate the feasibility of DP & DR actions even under RT price uncertainties. n TD47 North Bldg 229A Stochastic Gradient Descent: Recent Trends Emerging Topic Session Chair: John Shortle, George Mason University, Dept of Systems Engineering & OR, 4400 University Drive MS 4A6, Fairfax, VA, 22030- 4444, United States 1 - Stochastic Gradient Descent: Recent Trends Raghu Pasupathy, Purdue University, Department of Statistics, 150 N. University Street, West Lafayette, IN, 47907, United States, Farzad Yousefian, David Newton Stochastic Gradient Descent (SGD), also known as stochastic approximation, refers to certain iterative structures used for solving stochastic optimization and root finding problems. Owing to several factors, SGD has become the leading method to solve optimization problems arising within large-scale machine learning and “big data contexts such as classification and regression. This tutorial will cover the basics of SGD with an emphasis on modern developments. The tutorial starts with examples and problem variations where SGD is applicable, and then details important flavors of SGD that are currently in use. The presentation of this tutorial will include numerical examples. n TD48 North Bldg 229B Sustainability and Social Responsibility Sponsored: Energy, Natural Res & the Environment Environment & Sustainability Sponsored Session Chair: Chengzhang Li, Purdue University, West Lafayette, IN, United States 1 - Choosing the Contract Terms in Carbon Offset Markets Gokce Esenduran, Purdue University, 403 W. State Street, West Lafayette, IN, 47907, United States Purchasing voluntary carbon offsets is becoming an increasingly popular way of counteracting carbon emissions. One of the main issues with carbon markets is additionality, i.e., whether the offset project would have happened even if it were not funded through this market. Offset providers can prove additionality through contract terms, i.e., by forward crediting of ex-ante offsets. Or, providers can choose prompt delivery of existing offsets and ensure risk-free deliveries. We analyze the competition between providers and find the equilibrium choice of contract terms. We identify under what conditions prompt delivery achieves higher expected emission reduction than forward crediting.

2 - Mitigating Poverty through Solar Panel Adoption in Developing Economies

Zhuo Feng, Assistant Professor, Dalian University of Technology, No. 2 Linggong Road, Dalian, 116024, China, Qiaochu He, Guangrui Ma In this paper, we investigate a national strategy initiated by the Chinese governments, to combine the growth of solar energy sector with poverty mitigation. By considering households’ strategic behavior in buying/selling electricity, we show that only a subset of households will adopt solar panels in equilibrium. We have also examined the government’s optimal subsidy design to achieve socially optimal adoption number. Since many Chinese local governments have introduced Public Private Partnership (PPP) scheme to encourage solar panel adoption, we have further examined the outcomes of PPP scheme. 3 - Can Voluntary Time-of-use Tariffs be Successfully Diffused in the Residential Electricity Sector? Karthik Murali, University of Alabama, Tuscaloosa, 351 Alston Hall, Tuscaloosa, AL, 35487, United States, Dong Gu Choi, Michael Lim, Valerie Thomas Time-of-use pricing is increasingly deployed with some success in the industrial sector, but uptake among residential consumers remains sluggish. In this paper, we investigate how heterogeneity in consumer use-preferences complicates the problem of designing an optimal voluntary time-of-use pricing scheme, and suggest alternative mechanisms to improve residential consumer participation. 4 - The Value of Competition in Remanufacturing Narendra Singh, Indian School of Business, Knowledge City, We study an OEM’s product strategy when the OEM offers a new product that depreciates over time and consumers are strategic. The OEM competes with a third-party remanufacturer for acquisition and remanufacturing of the depreciated products. We study how competition from the third-party remanufacturer affects the OEM. 5 - Ensuring Corporate Social Responsibility in Supply Chain Networks through Multi-unit Bargaining Chengzhang Li, Purdue University, West Lafayette, IN, 47906, United States, Qi Feng, Mengshi Lu, J. George Shanthikumar We study ensuring corporate social responsibility (CSR) in general supply chain networks through multi-unit bargaining. We derive the equilibrium negotiation outcome, which captures the imbalance of the bargaining power in the supply chain, and demonstrate its advantages over existing approaches. We also investigate the initiator’s preferred implementation structure, and various extensions including multiple investment levels, multiple CSR programs, and decentralized implementation structure decisions that recover the initiator’s preferred one. n TD49 North Bldg 230 Renewables, PHEVs, and Electricity Markets Emerging Topic: Energy and Climate Emerging Topic Session Chair: Yongpei Guan, University of Florida, Gainesville, FL, 32611, United States 1 - Capacity vs Energy Subsidies for Renewables: Simulation of the 2030 EU Power Market Benjamin Field Hobbs, Johns Hopkins University, Ames Hall 3rd Fl Geography & Enviro, 3400 N. Charles St, Baltimore, MD, 21218, United States, Ozge Ozdemir, Marit van Hout, Paul Koutstaal We compare the impact of energy-focused (feed-in premium) and capacity- focused (investment subsidies) renewable policies upon the EU-wide electric power market in 2030 using a market equilibrium model COMPETES. Specifically, do capacity-based policies result in significantly more investment and possibly learning? We also evaluate the efficiency of national policy targets for renewable electricity production (as a whole or per technology) and compare these with a cost-effective allocation of renewable energy production, given resource quality, network constraints and the structure of the electricity system in the various EU countries. Sector 81, SAS Nagar, Mohali, 140 306, India, Karthik Ramachandran, Ravi Subramanian

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