Integrated Optimization and Game Theory Framework for Fair Cost Allocation in Community Microgrids

TL;DR

This work addresses fair cost allocation in community microgrids by marrying operational optimization with cooperative game theory. It introduces a unified framework that uses multi-objective MILP for optimal resource dispatch and Shapley-value analysis for transparent benefit distribution, ensuring both system efficiency and participant equity. Validation across six diverse scenarios shows substantial peak reductions (up to $62.6\%$) and solar utilization exceeding $114.8\%$, with cooperative gains up to $\$1{,}801.01$ per day, demonstrating robust performance under variable conditions. The results highlight the framework’s practical impact on reliable, fair, and scalable microgrid operation in real-world settings.

Abstract

Fair cost allocation in community microgrids remains a significant challenge due to the complex interactions between multiple participants with varying load profiles, distributed energy resources, and storage systems. Traditional cost allocation methods often fail to adequately address the dynamic nature of participant contributions and benefits, leading to inequitable distribution of costs and reduced participant satisfaction. This paper presents a novel framework integrating multi-objective optimization with cooperative game theory for fair and efficient microgrid operation and cost allocation. The proposed approach combines mixed-integer linear programming for optimal resource dispatch with Shapley value analysis for equitable benefit distribution, ensuring both system efficiency and participant satisfaction. The framework was validated using real-world data across six distinct operational scenarios, demonstrating significant improvements in both technical and economic performance. Results show peak demand reductions ranging from 7.8% to 62.6%, solar utilization rates reaching 114.8% through effective storage integration, and cooperative gains of up to $1,801.01 per day. The Shapley value-based allocation achieved balanced benefit-cost distributions, with net positions ranging from -16.0% to +14.2% across different load categories, ensuring sustainable participant cooperation.

Figures (15)

• Figure 1: Schematic of a grid-connected community microgrid.
• Figure 2: System power and grid price - Peak Demand Day.
• Figure 3: Battery operation and SoC - Peak Demand Day.
• Figure 4: System power and grid price - Low Demand Day.
• Figure 5: Battery operation and SoC - Low Demand Day.